ACCA Applied Knowledge · Financial Accounting · Double-entry bookkeeping principles including the maintenance of accounting records
Which transaction would NOT normally be recorded first in the journal as a book of prime entry?
A cheque received from a customer is recorded first in the cash book, not the journal. The journal handles non-routine items such as credit purchases of non-current assets, irrecoverable debt write-offs and corrections of errors.
- APurchase of a non-current asset on credit
- BWriting off an irrecoverable debt
- CCorrection of an error through a suspense account
- DReceipt of a cheque from a customer for a credit saleCorrect
Explanation
Cash and cheque receipts are recorded first in the cash book. The journal is used for unusual items such as credit asset purchases, irrecoverable debt write-offs and error corrections. Those other options are therefore typical journal entries.
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