Day: September 17, 2018

Accounting Multiple Choice Question – 17 September 2018

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Which of the following double-entries is the correct way to record the sale of goods on credit to a customer of the business?

Select ONE answer:

  1. Account to Debit Customer Account / Account to Credit Sales
  2. Account to Debit Returns Inwards / Account to Credit Customer Account
  3. Account to Debit Cash / Account to Credit Purchases
  4. Account to Debit Customer Account / Account to Credit Returns Inwards

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple choice question is suitable for Accounting KS5 classes.

The answer is 1 – This is the correct double entry record when a business sells goods on credit to a customer as this a debtor account which is an asset.  As a result of selling the good to the customer, they now owe more money than they previously did, and thus to increase the amount in the asset account, that account must be debited.

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