Test I. Modified True or False: On the blank before each number, write True if the statement is correct; if it is False, change the underlined word's to make the statement correct. (x2; total = 20 points) A sales journal is to be used for purchases of merchandise on account. 2. Special journals are journals that record transactions of the same nature. 3. Totals in the subsidiary ledger must always be in agreement with the balances of the controlling account. 4. The items entered in the cash column of cash receipts journal does not come only from cash sales. 5. The design of special journal is uniform in all types of industry. 6. The use of special journal saves time in journalizing and posting. 7. The cash payment journal records all cash received by the company from whatever sources. 8. The cash receipts journal record all cash disbursed or paid for whatever purpose. 9. In periodic inventory system, inventory quantity is determined by counting the actual goods on hand. It is a system in which the inventory account is updated only at the end of the accounting period. 10. In perpetual inventory system maintains an accurate item-by-item record of inventory on hand at all times. It is a continuous detailed record of goods received, sold, returned and on hand.Test II. Problem: Shown below is a page from a special journal. (30 points) Accounts Cash Date Sold To PR Receivable Sales Sales DR CR CR 2011 May 17 Joy Gragasin 30, 000 30. 000 18 Lourdes Sanchez 7, 000 7, 000 20 Marivic Callao 18, 000 18, 000 48, 000 7. 000 55, 000 (24) ()) (50) Questions: 1. What kind of journal is this? 2. Give an explanation for transaction dated May 17 and May 18. 3. Explain the following: a. The numbers under the bottom lines. b. The check marks entered in the post reference columns. C. The check marks under the bottom line