From the transaction below: ‘A Smith owed the business £1,500 for the goods sold to him on May 10, Year 2. The terms of sale allow for 3% cash discount for payment within 7 days. On May 15, Year 2, A Smith paid his debt by cheque.’
What entries in the cash book are necessary for this transaction?
A. Cr Discount allowed £45 & Cr Bank £1,455
B. Dr Discount allowed £45 & Cr Bank £1,455
C. Dr Discount allowed £45 & Dr Bank £1,455
D. Cr Discount allowed £45 & Dr Bank £1,455
................. is indicated in the invoice and recorded in the accounts.
A. Cash discount
B. Discount received
C. Discount allowed
D. Trade discount
A general term for amounts owing to persons other than the owner is ......
A. liabilities
B. reditor
debtor
C. loan
D. creditor
In the accounting equation, ........
A. The two sides will always be equal to one another
B. The two sides will never be equal to one another
C. Total of assets is always smaller than total of capital and liabilities
D. Total of assets is always bigger than total of capital and liabilities
The word ......... in the heading of the balance sheet is linked to the idea of the snapshot photograph.
A. with
B. at
C. month
D. equal
‘Capital’ is ................
A. the amount of the owner’s stake in the business.
B. a type of financial statement
C. resources or items owned by the business
D. record of transactions by categories
4 types of personal accounts include capital, supplier, customer, and ..........
A. drawings
B. sales
C. bank
D. cash
The account ‘T Smith’ has 4 transactions during July, Year 4, including 2 debit entries with £50 & £80 and 2 credit entries with £170 and £230. How much is the balance of this account at the end of July, Year 4?
A. £270 Dr
B. £270 Cr
C. £170 Dr
D. £170 Cr
.............. is direct transfer between bank accounts, involving fixed accounts at regular intervals.
A. standing order
B. direct debit
C. Cheque
D. credit transfer
............. accounts are individual accounts of debtors and creditors.
A. personal
B. impersonal
C. real
D. nominal
.............. Ledger is used to record creditor accounts
A. Sales
B. Purchases
C. General
D. Private
.............. is a direct means of transferring money through the bank systems, which is initiated by the paying party.
A. direct debit
B. cheque
C. standing order
D. credit transfer
.............. Ledger is used to record debtor accounts
A. Sales
B. Private
C. General
D. Purchases
The difference between current account and deposit account is that current account is used for ............ banking and withdrawal of money, and in deposit account withdrawals will be .............
A. infrequent/ Regular
B. regular/ regular
C. regular/ infrequent
D. infrequent/ infrequent
Where balances are carried forward from one page to the next, ‘balance .........’ would appear at the bottom of one page and ‘balance .......’ at the top of the next page.
A. b/f – c/f
B. c/d – b/d
C. b/d – c/d
D. c/f – b/f
The account ‘Bank’ has 3 transactions during July, Year 4, including 1 debit entries with £2,000 and 2 credit entries with £170 and £240. How much is the balance of this account at the end of July, Year 4?
A. £1,690 Cr
B. £1,590 Cr
C. £1,690 Dr
D. £1,590 Dr
Book-keeping entries relating to Credit Sales are:
A. credit customer’s (debtor’s) account & debit sales account
B. debit customer’s (debtor’s) account & credit sales account
C. debit customer’s (debtor’s) account & debit sales account
D. credit customer’s (debtor’s) account & credit sales account
The term ‘account’ means .....
A. a record of transactions by category (purchases, for example), or by person or organization.
B. person (or business) to whom money is owed by the business
C. person (or business) who owes money for goods or services supplied by the business
D. taking an ownership of an asset now, but paying for it at later stage
The term ‘Transaction on credit’ means ........
A. a record of transactions by category (purchases, for example), or by person or organization.
B. person (or business) to whom money is owed by the business
C. taking an ownership of an asset now, but paying for it at later stage
D. person (or business) who owes money for goods or services supplied by the business
Book-keeping entries relating to Cash Sales are:
A. debit Cash/ Bank account & credit Sales account
B. credit Cash/ Bank account & credit Sales account
C. debit Cash/ Bank account & debit Sales account
D. credit Cash/ Bank account & debit Sales account
