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| Section | Objectives |
|---|---|
| Topic 1: Recording Financial Transactions | - Ledger accounts and trial balance preparation - Control accounts and reconciliations |
| Topic 2: Accounting Adjustments and Controls | - Errors and suspense accounts - Inventory valuation and adjustments - Non-current assets and depreciation |
| Topic 3: Financial Statements Preparation | - Accruals and prepayments adjustments - Income statement and statement of financial position |
| Topic 4: Accounting Fundamentals and Principles | - Basic accounting concepts and principles - Double-entry bookkeeping system |
1. On 1 April 2006, a company was owed $13,560 by a customer. During the month of April the customer purchased goods for $6,800 and returned goods valued at $1,200. A cheque for $8,480 was received from the customer but was subsequently dishonored by the bank. The balance on the customer's account at the end of the month is:
A) $10,680
B) $11,880
C) $19,160
D) $20,360
2. Refer to the exhibit.
A suspense account shows a credit balance of $230 which has arisen because of the recording of a gas bill twice in the gas account.
In order to correct the error, which one of the following journal entries is required?
The correct journal entry is
A) B
B) D
C) C
D) A
3. The Subscriptions Receivable account of a club commenced the year with subscriptions in arrears of £250 and subscriptions in advance of £375.
During the year £62,250 was received in subscriptions, including £200 of the arrears, and £600 for next year's subscriptions. Subscriptions still owing at the end of the year amounted to £180.
The amount to be taken to the Income and Expenditure for the year is
4. A payment to a supplier has been credited to the supplier's account and debited to the bank account.
This would result in
A) an understatement of profit and an overstatement of liabilities
B) an overstatement of profit and an overstatement of assets
C) an overstatement of profit and an overstatement of liabilities
D) an understatement of profit and an overstatement of assets
5. Refer to the Exhibit.
A business writes a cheque using its overdraft balance to purchase new display shelving for its showroom Which of the following is the dual effect?
A) B
B) D
C) C
D) A
Solutions:
| Question # 1 Answer: C | Question # 2 Answer: C | Question # 3 Answer: Only visible for members | Question # 4 Answer: C | Question # 5 Answer: D |
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