If There Is No Cash Involved in a Particular Business

question 92

Multiple Choice

If there is no cash involved in a particular business transaction then the transaction should be recorded in:

• A)either cash receipts journal or general journal.
• B)either sales journal or purchases journal.
• C)only general journal.
• D)sales journal, purchases journal, or general journal.

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Definitions:

Restricted Contribution

Funds given to an entity with specific conditions or purposes attached, limiting their use.

Endowment Contributions

Financial gifts provided to an institution, typically with the stipulation that the principal remains intact while the investment income is used for organizational purposes.

Restricted Fund

Funds that are earmarked for a particular purpose or project by donors or grantors and cannot be freely used for any other expenditures.

Investment Income

Income earned from investments, including dividends, interest, and capital gains from securities, real estate, or other assets.