When the Sales Journal's Column for Accounts Receivable and Sales

question 45

Multiple Choice

When the sales journal's column for accounts receivable and sales is totaled at the end of the month, its total is:

• A) Debited to Sales and credited to Accounts Receivable.
• B) Debited to Accounts Receivable and credited to Cash.
• C) Debited to Cash and credited to Accounts Receivable.
• D) Debited to Accounts Receivable and credited to Sales.
• E) Debited to Cash and credited to Sales.

---

Definitions:

NPV

Net Present Value; a calculation used to determine the value of an investment by considering the present value of its expected future cash flows minus the initial investment cost.

Contribution Margin

The amount by which a product's sales price exceeds its total variable costs, indicating how much contribution the product makes towards fixed costs and profits.

Variable Cost

Costs that vary directly with the level of output or production activity, such as raw materials or hourly labor.

Cash Break-even

The point at which a company does not make a profit or loss from operations, calculated by covering all cash operating expenses with the revenue generated.