Month: March 2020

A firm’s list of debtor balances. which totalled £39,150 did not agree with its debtors ledger control account.

Upon investigation, the following errors were discovered:

• A credit balance of £70 on one debtor’s account in the sales ledger had been listed as a debit balance.
• A debit balance of £40 on another debtor’s account in the sales ledger had been listed as a credit balance.
• The list of balances had been overcast by £60

The correct debit balance brought down on the debtors ledger control account is?

Select ONE answer:

1. £30,030
2. £39,060
3. £39,150
4. £39,210

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

1. Correct – £39,150 – (£70 x 2) + (£40 x 2) – £60 = £39,030
2. Not correct
3. Not correct
4. Not correct

 

 

This work is licensed under a Creative Commons Attribution 4.0 International License.

A firm listed its debtors balances. These totalled £29,175. The balance on the firm’s sales ledger control account did not agree with this total. Upon investigation, the following errors were discovered.

• A credit balance of £80 on one debtor’s account in the sales ledger had been listed as a debit balance.
• A debit balance of £67 on another debtor’s account in the sales ledger had been listed as a credit balance.
• £220 received from a debtor had been entered in the purchases ledger instead of the sales ledger.
• The list of balances had been overcast by £72.

The correct (debit) balance on the sales ledger control account is?

Select ONE answer:

1. £28,857
2. £28,870
3. £29,001
4. £29,297

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

1. Correct – £29,175 – (£80 x 2) + (£67 x 2) – £220 – £72 = £28,857
2. Not correct
3. Not correct
4. Not correct

 

 

This work is licensed under a Creative Commons Attribution 4.0 International License.

A firm that sells exclusively on credit allows a discount of 2% to its customers if they pay by the due date, which they always do.

The following details’ are available for the firm’s most recent financial year:

• Amount owed by debtors at the beginning of the year £22,000
• Amount owed by debtors at the end of the year £24,000
• Bad debts written off during the year £3,500
• Money received from debtors during the year £147,000

The firm‘s credit sales for the year were?

Select ONE answer:

1. £148,469
2. £152,500
3. £155,500
4. £155,612

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 3

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

Answer 3:

Because 2% discount on £147,000 = 98% debt owed received. Therefore discount = £3,000

DebtorsDr Balance b/d £22,000
Dr Bad Debt Recovered £0
Dr Sales (Credit) £155,500
Dr Totals £177,500
Cr Bank £147,000
Cr Bank (Bad Debt Recovered) £0
Cr Discount Allowed £3,000
Cr Bad Debts £3,500
Cr Balance c/d £24,000
Cr Totals £177,500

 

This work is licensed under a Creative Commons Attribution 4.0 International License.

At the start of a financial year, a firm’s gross debtors amounted to £5,000.

At the end of the year, this amount had increased by 20%. During the year £15,000 was received from debtors and discounts totalling £1,000 were allowed to debtors.

Bad debts written off amounted to £2,000 and £4,000 was received from a debtor previously written off as bad.

Credit sales for the year were?

Select ONE answer:

1. £14,000
2. £15,000
3. £19,000
4. £20,000

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 3

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

Answer 3:

Debtors
Dr Balance b/d £5,000
Dr Bad Debt Recovered £4,000
Dr Sales (Credit) £19,000
Dr Totals £28,000
Cr Bank £15,000
Cr Bank (Bad Debt Recovered) £4,000
Cr Discount Allowed £1,000
Cr Bad Debts £2,000
Cr Balance c/d £6,000 (£5,000 + 20%)
Cr Totals £28,000

 

This work is licensed under a Creative Commons Attribution 4.0 International License.

The following information relates to a firm’s most recent accounting period.

• Creditors at 1 January £5,000
• Transactions for the period 1 January to 31 December
  • Discount received £500
  • Credit purchases £60,000
  • Payments to suppliers £54,000
  • Cash purchases £7,000
  • Returns outwards £3,500

The balance on the firm’s creditors control account at 31 December was?

Select ONE answer:

1. £1,000
2. £7,000
3. £8,000
4. £13,000

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 2

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

Answer 2:

Cash purchases are not relevant to the creditors control account

Creditors
Dr Discount Received £500
Dr Returns Outwards £3,500
Dr Bank £54,000
Dr Debtors £0
Dr Balance c/d £7,000
Dr Total £65,000
Cr Balance b/d £5,000
Cr Purchases £60,000
Cr Bank £0
Cr Total £65,000

 

This work is licensed under a Creative Commons Attribution 4.0 International License.