Question

Which of the following statements is correct about recording transactions in a journal?

Group of answer choices

The accounting equation must be in balance after each transaction is recorded.

Every transaction must affect at least one revenue account.

Every transaction must affect at least three accounts in the accounting equation.

There must be the same number of accounts debited as there are accounts that are credited.

Answer 1

HERE ''OPTION A'' IS THE CORRECT ANSWER ( i.e.. The accounting equation must be in balance after each transaction is recorded.)

THIS STATEMENT IS CORRECT.

THE TOTALS OF THE DEBITS AND CREDITS FOR ANY TRANSACTION MUST ALWAYS EQUAL EACH OTHER SO THAT AN ACCOUNTING TRANSACTION IS ALWAYS SAID TO BE IN BALANCE.

WHY OTHER OPTIONS ARE WRONG :-

OPTION B( Every transaction must affect at least one revenue account. )

THIS STATEMENT IS WRONG.

THE REVENUE ACCOUNT ONLY AFFECT WHEN ASSETS EARNED BY A COMPANY'S OPERATIONS AND BUSINESS ACTIVITIES.REVENUES INCLUDE THE CASH OR RECEIVABLES RECEIVED BY A COMPANY FOR THE SALE OF ITS GOODS OR SERVICES.

OPTION C ( Every transaction must affect at least three accounts in the accounting equation. )

THIS STATEMENT IS WRONG.

WHENEVER AN ACCOUNTING TRANSACTION HAPPENS, A MINIMUM OF TWO ACCOUNTS (NOT THREE ACCOUNTS ) IS ALWAYS IMPACTED ,WITH A DEBIT ENTRY BEING RECORDED AGAINST ONE ACCOUNT AND A CREDIT ENTRY BEING RECORDED AGAINST ANOTHER ACCOUNT. THERE IS NO UPPER LIMIT TO THE NUMBER OF ACCOUNTS INVOLVED IN A TRANSACTION BUT THE MINIMUM CANNOT BE LESS THAN TWO ACCOUNTS.

OPTION D ( There must be the same number of accounts debited as there are accounts that are credited)

THIS STATEMENT IS ALSO WRONG.

IN THE COMPOUND JOURNAL ENTRY IS NOT THE SAME NUMBER OF ACCOUNTS DEBITED AS THERE ARE ACCOUNTS THAT ARE CREDITED.A COMPOUND JOURNAL ENTRY IS THE JOURNAL ENTRIES IN THE ACCOUNTING SYSTEM WHERE MORE THAN ONE ACCOUNT IS DEBITED OR MORE THAN ONE ACCOUNT IS CREDITED.