Month: May 2024

All Elmo’s sales and purchases carry VAT at 17.5%.

A customer has just returned goods sold for £230 plus VAT.

The double entry for this transaction is?

Select ONE answer:

1. Debit Receivables control £270.25, Credit VAT control £40.25, Credit Sales £230.00
2. Debit Sales £270.25, Credit Receivables control £270.25
3. Debit Sales £230.00, Debit VÁT Control £40.25, Credit Receivables control £270.25
4. Debit Receivables control £230.00, Debit VAT control £40.25, Credit Sales £270.25

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 –  Debit Sales £230.00, Debit VAT Control £40.25, Credit Receivables control £270.25
4. Not correct

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Identify whether the following occurrences might explain the existence of a credit balance on a customer’s receivables ledger account.

The bookkeeper posted a total from the sales day book to the receivables control account twice by mistake.

A  Would explain a credit balance

B  Would not explain a credit balance

The customer failed to take account of a credit note when payıng an invoice.

C  Would explain a credit balance

D  Would not explain a credit balance

Select ONE answer:

1. A & C
2. A & D
3. B & C
4. B & D

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 – False this is a control account posting therefore does not affect the individual balances in the ledger.  True – the customer would overpay if it ignored a credit note.
4. Not correct

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An error is identified where a discount received of £1,420 has been debited to both the payables control account and the discounts received account.

The journal required to correct this is?

What should the closing balance be when the errors have been corrected?

Select ONE answer:

1. Debit Suspense £2,840, Credit Discount received £2,840
2. Debit Suspense £1,420, Credit Discount received £1,420
3. Debit Suspense £2,840, Credit Payables control £2,840
4. Debit Suspense £1,420, Credit Payables control £1,420

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 –> Dr suspense £2,840, Cr Discount received £2,840
2. Not correct
3. Not correct
4. Not correct

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

A receivables ledger reconciliation was prepared by the bookkeeper of Alex & Co as at 31 March 2024 but one heading was illegible and has been called ‘other difference’.

RECEIVABLES CONTROL ACCOUNT
DR Balance B/D £25,320
DR Total £25,320

CR Sales day book overcast £1,000
CR Balance c/d £24,320
CR Total £25,320

Total per receivables ledger listing £23,890
Credit balance listed as debit £280
‘Other difference’ £710
Total £24,320

The ‘other difference’ is most likely to be?

Select ONE answer:

1. Contra settlement omitted from the memorandum ledgers
2. Invoice omitted from the sales day book
3. Balance omitted from the receivables ledger listing
4. Irrecoverable debt not written off in the memorandum ledger

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 – balance omitted from the receivables ledger listing (C). Both would be affected by (B); in (A) and (D) the receivables ledger would be reduced
4. Not correct

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

Which of the following is an error in only the receivables ledger, not the control account?

Select ONE answer:

1. Invoice omitted from the sales day book
2. Transposition error in posting to the receivables ledger from the sales day book
3. Transposition error in filling in the sales day book from an invoice sent out
4. Miscasting the total of the sales day book

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. Notcorrect
2. Correct –> Transposition error in posting to the receivables ledger from the sales day book (2). In (1) and (3) both the ledger and the control account will be affected. In (4) only the control account would be affected.
3. Not correct
4. Not correct

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