In the case of a DIY store, which of the following double-entries is the correct way to record the payment of council business rates for the for the current accounting period by cheque ………..?
Select ONE answer:
- Account to Debit Bank / Account to Credit Rates
- Account to Debit Rates / Account to Credit Bank
- Account to Debit Expenses / Account to Credit Bank
- None of the above
Show your workings to arrive at your answer, and explain and justify your reasons:
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This multiple choice question is suitable for Accounting KS5 classes.
The answer is 2 – All expenses are recorded as debit entries in the relevant expense account and the bank balance is thus reduced as a result through a credit.
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