The Cash Over and Short Account

question 35

Multiple Choice

The Cash Over and Short account:

• A) Is used to record a credit balance in the cash account.
• B) Is an income statement account used for recording the income effects of cash overages and cash shortages from errors in making change and/or from errors in processing petty cash transactions.
• C) Is not necessary in a computerized accounting system.
• D) Can never have a debit balance.
• E) Can never have a credit balance.

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Definitions:

Spreadsheet

A digital tool that organizes data in columns and rows, commonly used for calculations and data analysis.

Cash Flows

The complete volume of financial transactions entering and exiting a business, with a key effect on its financial fluidity.

Investing Activities

Financial transactions and events related to the acquisition or disposal of long-term assets and investments included in a company’s cash flow statement.

Long-Term Assets

Long-term assets are assets that a company expects to use for more than one year, including property, plant, equipment, and intangible assets.