- (Topic 1)
Where should a firm??s business transactions FIRST be recorded?
Correct Answer:C
Comprehensive and Detailed Explanation:AJournal(Option C) is thefirst placewhere business transactions are recorded inchronological orderbefore posting to theGeneral Ledger.
✑ Option A (Balance Sheet)is incorrect because it is afinancial statement, not a
transaction log.
✑ Option B (General Ledger)is incorrect because transactionsmust first be recorded
in a journal before being posted.
✑ Option D (Trial Balance)is incorrect because it isa summary of ledger balances used for reconciliation.
Reference:
GAAP Accounting Principles – Transaction Recording Process Payroll.org – Payroll Accounting Workflow
- (Topic 2)
The purpose of the prenotification process for direct deposit is to ensure that the transaction is:
Correct Answer:C
✑ Prenotification ensures that the receiving bank (C) accepts and properly routes the direct deposit transaction before funds are sent.
References:
✑ NACHA Direct Deposit Standards
- (Topic 1)
An order for unpaid federal taxes is an example of a:
Correct Answer:D
Comprehensive and Detailed Explanation:Awage attachment(also called awage levy) is alegal withholdingfrom an employee??s paycheck to satisfy an outstanding debt.
✑ IRS tax leviesare a type ofwage attachmentused to collectunpaid federal
taxesdirectly from an employee??s wages.
✑ Employersmust comply immediatelywhen notified by the IRS.
✑ Option A (Bankruptcy Order)is incorrect because bankruptcy payments are handled bycourt-appointed trustees, not wage levies.
✑ Option B (Creditor Garnishment)is incorrect because IRS tax leviesdo not require a court orderlike private creditor garnishments.
✑ Option C (Voluntary Deduction)is incorrect because IRS wage leviesare mandatory, not voluntary.
Reference:
IRS Publication 1494 – Wage Levy Exemptions and Employer Responsibilities Payroll.org – Wage Attachments and Tax Levies