Accounting Multiple Choice Question – 9 April 2024

Alex’s business bank statement showed an overdrawn balance of £5,250 on 31 October 2021.

When this was reconciled to the cash book, the following differences were noted:

• Unpresented cheques – £1,070
• Uncredited lodgements – £1,240
• Standing order for insurance premium payable not entered in the cash book  – £890
• Overdraft interest not recorded in the cash book – £80
• Credited in error to Alex’s account by the bank – £300

What was the original balance on Alex’s cash book at 31 October 2021?

Select ONE answer:

1. £4,450 credit
2. £4,410 credit
3. £2,940 credit
4. £1,670 debit

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 – 4,410 credit ==> £5,250 o/d – £1,070 + £1,240 – £300 = £5,380 credit balance – £890 s/o – £80 o/d interest = £4,410 credit 
3. Not correct
4. Not correct

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