REVIEW CHAP 1-4

REVIEW CHAP 1-4
1. Which account balance is normally in credit?

A. Trade Receivables
B. Trade Payables
C. Inventory
D. Cash
2. Which will normally show as a debit balance in the ledger accounts?
A. Sales
B. Non-current Assets
C. Trade Payables
D. Bank Loan
3. The bookshop owner invests $3,000 as capital and uses it to buy books for $3,000 cash. The
business then sells half of the books purchased for $2,500.
A. Current assets $4,000 = Capital $4,000
B. Current assets $3,000 = Capital $3,000
C. Current assets $5,500 = Capital $5,500
D. Current assets $1,500 = Capital $1,500
4. Which documents are businesses required to retain?
A. Invoices
B. Bank statements
C. Records of employees' pay and deductions
D. Employee emails
5. Which of the following statements about the purchases ledger account is/are true?
i. The purchases ledger includes all purchases made by the business
ii. Invoices are recorded in the purchases ledger and are then checked against supporting documentation
such as purchase orders and delivery notes
I) true ii) true
i) true ii) false
i) false ii) true
i) false ii) false
6. A credit note for $2,000 is received by a business from a supplier. In which of the following of the
business's ledger accounts would this be recorded?
A. The sales ledger
B. The purchase ledger
C. The purchase returns ledger
D. The journal
7. One of a business’s customers has gone into bankruptcy and the outstanding debt of $500 is now
considered irrecoverable. What entries would be made in the general ledger to reflect this, ignoring sales
tax?
A. DR Receivables account
CR Irrecoverable debts expense
B. DR Payables account
CR Irrecoverable debts expense
C. DR Irrecoverable debts expense
CR Payables account
D. DR Irrecoverable debts expense
CR Receivables account
8. A business makes credit sales of $5,000. The customer negotiates a trade discount
of 4% on this figure and is offered a 3% early settlement discount if the goods are
paid for within 30 days.
What amount will be recorded for the sale if the customer is not expected to take
up the settlement discount? (Note: no sales tax applies)
A. $4,656
B. $4,800
C. $4,850
D. $5,000
9. A $1,000 cheque is received from a customer in relation to credit sales where the
sales tax is 25%. The sale was accounted for correctly when it was made. What are
the necessary accounting entries in the general ledger for this remittance of $1,000?
A. DR Cash $1000
CR Receivables account $800
CR Sales tax $200
B. CR Cash $1000
DR Receivables account $800
DR Sales tax $200
C. DR Cash $1,000
CR Receivables account $1,000
D. CR Cash $1,000
DR Receivables account $1,000
10.In January, payments are received by cheque and electronic transfer from customers for $10,000, and
an outstanding debt of $1,500 is written off as irrecoverable. There were no sales recorded for January.
What is the total entry for the month to the receivables account in the general ledger?
A. DR $11,500
B. CR $11,500
C. DR $8,500
D. CR $8,500
11.On 3rd March credit sales were made of $25,000, cash sales of $4,500 were made, and debts
outstanding of $3,200 were written off as irrecoverable. What will be the total of entries for 3rd March to
the receivables account?
A. Debit $21,800
B. Credit $21,800
C. Debit $26,300
D. Credit $26,300
12.A business purchases goods from a supplier with a list price of $850. The supplier grants the business a
trade discount of 10%, and also offers a settlement discount of 5% if they pay within seven days.
How much should the business record for the purchase in the purchases ledger?
A. $726.75
B. $765.00
C. $807.50
D. $850.00
13.A business registered for sales tax pays an invoice in full to a supplier. The invoice was for goods
purchased with a list price of $600, exclusive of sales tax at 20%. The business was granted a trade
discount of 3%. What amount should the business record in the bank ledger account for this payment?
A. $582.00
B. $698.40
C. $720.00
D. $600.00
14.Which of the following would be included in the bank ledger account?
A. Cheque paid to supplier
B. Credit note received
C. Goods received note
D. Invoice sent to a customer
15.Alya is closing off the sales tax account. There is a balance b/d at the beginning of the month on the
debit side of $400, output tax of $2,700 and input tax of $630. What will the balance b/d be at the
beginning of the next month?
A. DR $1,670
B. DR $2,470
C. CR $2,470
D. CR $1,670
16.……………………….. occur when goods or services are received from a supplier for future payment.
17.At the end of August X1, the payables ledger of a business is $560, while the supplier statement
received shows a balance of $691. Upon review, the business identifies the following:
• An invoice of $45 was omitted from the purchase ledgerleft
• A credit note of $23 was incorrectly recorded in the payables ledger as $32left
• A payment of $77 made on 31st August was not reflected in the statementleft
After correcting these issues, what is the correct payables ledger balance?
A. $614
B. $691
C. $596
D. $537
18.Credit purchases of $200 have been posted to the general ledger: DR Cash $200, CR Purchases $200.
Ignoring sales tax, what is the journal entry required to correct this?
A. DR Purchases $200, CR Cash $200, CR Trade payables $200
B. DR Purchases $200, CR Trade payables $200
C. DR Purchases $200, CR Cash $200
D. DR Purchases $400, CR Cash $200, CR Trade payables $200
19.Which statement or statements about settlement discounts received are true?
i. They are recognised based on an estimate of the payment timeframe
ii. They represent an expense for the business
A. i) only
B. ii) only
C. Both i) and ii)
D. Neither i) nor ii)
20.At the end of September X5, the payables ledger of a business is $2,350, which differs from the
supplier statement received. Upon review, the business identifies the following:
• An invoice of $552 was omitted from the purchase ledger
• A credit note of $230 was omitted from the purchase ledger
• An error in the statement where payment of $650 was recorded as $560
After correcting these issues, what is the correct payables ledger balance?
A. $2762
B. $2,672
C. $2,582
D. $2,028

REVIEW CHAP 1-4

Uploaded by

Copyright:

Available Formats

REVIEW CHAP 1-4

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

REVIEW CHAP 1-4

Uploaded by

Copyright:

Available Formats

REVIEW CHAP 1-4

1. Which account balance is normally in credit?

You might also like

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.