1. X buys goods on credit from Y.
What is the name for the document used by X to settle the liability to Y?
A cheque
B credit note
C receipt
D statement of account
2. In which book of account is cash discount received first recorded?
A cash book
B purchases ledger
C sales journal
D sales ledger
3. X sells goods with a list price of $5000 to a credit customer. The customer is allowed a 5% trade
discount and a further 2 1/2% cash discount if payment is within 20 days of the invoice date.
What amount should be credited to the Sales account of X?
A $4631 B $4750 C $4875 D $5000
4. Which should be recorded in the general journal?
A debt written off as bad
B goods returned to supplier
C goods sold for cash
D trade discount allowed to customer
5. Which account could have a credit balance?
A bank
B carriage inwards
C carriage outwards
D cash
6. A bookkeeper recorded the receipt of a cheque for $245 in the cash book as $425.
What kind of error was this?
A commission
B omission
C original entry
D principle
7. A business received $123 from X. The entry in the cash book was correct but it was debited as
$132 in X’s account.
What is the difference between the totals of the trial balance?
A $9
B $18
C $255
D $264
8. Which item is capital income?
A cash received from the sale of office equipment
B cheque received from the sale of stock
C discounts received from trade creditors
D rent received from tenants
9. A business buys a delivery van for $12 000. Its estimated useful life is four years, after which its scrap value is estimated to be $4000. Depreciation is charged on the straight line basis.
What is the annual amount of depreciation?
A $1000 B $2000 C $3000 D $8000
10. Two companies each purchase a car for $10 000 at the beginning of year 1. Company G uses the straight line method of depreciation at a rate of 15 % per annum, while Company H uses the
reducing balance method at a rate of 20 % per annum.
What will be the difference in the depreciation charge between the two companies for year 2?
A $100 greater for G
B $100 greater for H
C $500 greater for G
D $500 greater for H
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What is the name for the document used by X to settle the liability to Y?
A cheque
B credit note
C receipt
D statement of account
2. In which book of account is cash discount received first recorded?
A cash book
B purchases ledger
C sales journal
D sales ledger
3. X sells goods with a list price of $5000 to a credit customer. The customer is allowed a 5% trade
discount and a further 2 1/2% cash discount if payment is within 20 days of the invoice date.
What amount should be credited to the Sales account of X?
A $4631 B $4750 C $4875 D $5000
4. Which should be recorded in the general journal?
A debt written off as bad
B goods returned to supplier
C goods sold for cash
D trade discount allowed to customer
5. Which account could have a credit balance?
A bank
B carriage inwards
C carriage outwards
D cash
6. A bookkeeper recorded the receipt of a cheque for $245 in the cash book as $425.
What kind of error was this?
A commission
B omission
C original entry
D principle
7. A business received $123 from X. The entry in the cash book was correct but it was debited as
$132 in X’s account.
What is the difference between the totals of the trial balance?
A $9
B $18
C $255
D $264
8. Which item is capital income?
A cash received from the sale of office equipment
B cheque received from the sale of stock
C discounts received from trade creditors
D rent received from tenants
9. A business buys a delivery van for $12 000. Its estimated useful life is four years, after which its scrap value is estimated to be $4000. Depreciation is charged on the straight line basis.
What is the annual amount of depreciation?
A $1000 B $2000 C $3000 D $8000
10. Two companies each purchase a car for $10 000 at the beginning of year 1. Company G uses the straight line method of depreciation at a rate of 15 % per annum, while Company H uses the
reducing balance method at a rate of 20 % per annum.
What will be the difference in the depreciation charge between the two companies for year 2?
A $100 greater for G
B $100 greater for H
C $500 greater for G
D $500 greater for H
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