Tag: Errors

The payables control account below contains a number of errors:

PAYABLES CONTROL ACCOUNT

DR   Opening balance          £318,600

DR  Cash paid to suppliers   £1,405,500

DR  Refunds received from suppliers  £2,700

DR  Total                          £1,726,800

  CR  Purchases                                £1,268,600

  CR  Discounts received                     £8,200

  CR  Contras with receivables              £48,000

  CR  Closing balance                        £402,000

  CR  Total                                      £1,726,800

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

Select ONE answer:

1. £122,800
2. £128,200
3. £144,600
4. £224,200

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 – DRs  Cash paid to suppliers £1,405,500, Contras with receivables £48,000, Discounts received  £8,200  Closing Balance £128,200 Total 1,589,900  CRs Opening balance £318,600, Purchases £1,268,600, Cash refunds £2,700  Total 1,589,900
3. Not correct
4. Not correct

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

Peri’s bookkeeper made the following mistakes:

1  Discount allowed £3,840 was credited to discounts received account.

2  Discount received £2,960 was debited to discounts allowed account.

3.  Discounts were otherwise correctly recorded.

Which of the following journal entries will correct the errors?

Select ONE answer:

1. Debit Discount allowed £7,680, Credit Discount received £S,920, Credit Suspense account, £1,760
2. Debit Discount allowed £880, Debit Discount received £880, Credit Suspense account £1,760
3. Debit Discount allowed £6,800, Credit Discount received £6,800
4. Debit Discount allowed £3,840, Credit Discount received £2,960, Credit Suspense account £880

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 – Start by posting the adjustment in full: Debit £ Discount allowed 3,840 Discount received 3,840 Credit £ Discount allowed 2,960 Discount received 2,960 + Suspense account 1,760
3. Not correct
4. Not correct

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

A bank statement on 31 October 2017 showed an overdraft of £800.

On reconciling the bank statement, it was discovered that a cheque drawn for £80 had not been presented for payment, and that a cheque for £130 from a customer had been dishonoured on 30 October 2017, but this had not yet been reflected in the cash book.

The correct bank balance to be shown in the statement of financial position at 31 October 2017 is?

Select ONE answer:

1. £1,010 overdrawn
2. £880 overdrawn
3. £750 overdrawn
4. £720 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 2

1. Notcorrect
2. Correct – Balance per bank statement £(800) – Unpresented cheque (80) – Doubtful cheque £0 = £(880)
3. Not correct
4. Not correct

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