A business gives a customer a discount. What happens in the accounting records?
Answer
(B)
The customer's account balance decreases.
9
Which of the following entries should be recorded in the sales ledger after a customer pays with a dishonored check?
Answer
(A)
Debit the customer's account and credit the bank account.
10
What is the effect of omitting the recording of drawings on the draft profit and financial position?
Answer
(A)
Profit is unaffected; Capital is understated.
11
Which journal would you use to record a sale on credit?
Answer
(B)
Sales Journal
12
How the balance of the purchases ledger will be affected in the below scenario: \$200 of discount allowed was omitted.
Answer
(C)
Expenses were overstated by \$200
13
Which of the following entries will decrease a debit balance in the purchase ledger control account?
Answer
(C)
Credit notes received from suppliers
14
A payment of $230 for those purchased on credit from M Shah had been debited in error to the trade payable account for J Shah. What type of error is it?
Answer
(B)
Error of commission
15
Which accounts are involved for depreciation?
Answer
(A)
Vehicle account, Provision for depreciation account
16
What will cause the balance on the purchases ledger control account to decrease?
Answer
A
C
D
17
A business provides a service on credit. Which account is debited?
Answer
(C)
Accounts Receivable
18
If an asset is disposed of, what impact does this have?
Answer
(B)
It decreases the assets on the balance sheet and potentially affects profit.
19
What does the balance on the accounts payable ledger represent?
Answer
(B)
The total amount owed to suppliers.
20
A payment of \$5000 from A. Murry was received. What impact would be on the draft profit in the below scenario?
Answer
(A)
No impact
21
A payment of \$5,000 from A. Murry was received. However, this transaction was not recorded. How does this error affect the draft financial position?
Answer
(C)
Capital is understated.
22
Which of the following statements are true regarding a dishonored cheque?
Answer
A
C
23
How will the correction of the error, where the payment of electricity expenses as a debit in bank, but as a profit in the electricity account, affect the financial statements?
Answer
A
B
D
24
What is the purpose of calculating depreciation?
Answer
(B)
To show the decline in value of an asset over time.
25
Which of these are examples of source documents?
Answer
A
B
C
26
How does an omitted discount allowed of \$200 affect the financial statements?
Answer
(B)
Expenses overstated and capital unaffected.
27
Which items would cause a debit balance in the sales ledger control account?
Answer
A
D
28
If a supplier offers a discount, how does that impact the company's books?
Answer
(A)
Debit trade payables, credit discount received.
29
Which journal entry is needed if a customer returns goods purchased on credit?
Answer
(B)
Debit Accounts Receivable, Credit Sales Returns
30
Which of the following are considered revenue expenditures?
Answer
A
B
D
31
What is the best way to define depreciation?
Answer
(B)
The allocation of the cost of a long-term asset over its useful life.
32
Which statement best describes the journal entry to record depreciation expense?
