Accounting Multiple Choice Question – 22 February 2020

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

Accounting

On 31 March the balance brought down on a firm’s bank account in its ledger was £3,600, credit.

At the same date, outstanding cheques amounted to £1,400 and outstanding lodgements amounted to £2,000. A cheque for £500, received from a debtor, was subsequently dishonoured. The receipt of the cheque had been correctly recorded but no entry has yet been made in the accounting records in respect of it being dishonoured.

On the basis of the above information, the balance on the firm’s bank statement at 31 March was:

Select ONE answer:

  1. £3,500 credit
  2. £3,700 credit
  3. £4,200 overdrawn
  4. £4,700 overdrawn

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 4

  1. Not correct
  2. Not correct
  3. Not correct
  4. Correct

Correction of Ledger
Bank
Dr Balance c/d £4,100
Cr Balance b/d £3,600
Cr Dishonoured cheque £500
Totals £4,100

Bank Reconciliation Statement as at 31 March
Balance per ledger (corrected) -£4,100
Outstanding lodgements -£2,000
Cheques not presented +£1,400
Balance per bank statement £4,700

 

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Author: stuart001uk2014

Referral marketing, business, economics and accounting s​pecialist & corporate mentor

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