Month: May 2024

Alex received a statement from its supplier Lucy, showing a balance to be paid of £8,950.

Alex’s payables ledger account for Lucy shows a balance due to Lucy of £4,140.

Investigation by the chief accountant Stuart reveals the following:

1  Cash paid to Lucy of £4,080 by Alex has not been recorded by Lucy.

2  Alex has not adjusted the ledger account for £40 of cash discount disallowed by Lucy.

3.  Goods returned by Lucy £380 have not been recorded by Alex.

What discrepancy remains between Alex’s and Lucy’s records after allowing for these items?

Select ONE answer:

1. £9,310
2. £1,070
3. £390
4. £310

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 – Alex’s balance £4,140 + Discount disallowed £40 + Cash paid £4,080 + Goods returned £380 = £8,680 – Lucy Balance of £8,950 means a difference of £310 remaining

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