Financial Accounting | Study Mode

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Question 1
A
debt note 
B
credit note 
C
invoice 
D
receipt 
Explanation.
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Aninvoice, bill or tab is a commercial document issued by a seller to a buyer, relating to a sale transaction and indicating the products, quantities, and agreed prices for products or services the seller had provided the buyer.


Correct Option:
C
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Question 2
A
purchase ledger 
B
general ledger 
C
nominal ledger 
D
sales ledger 
Explanation.
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A bought ledger is a system in accounting by which a business records and monitors its creditors. The purchase ledger contains the individual accounts of suppliers from whom the business has made purchases on credit.


Correct Option:
A
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Question 3
A
petty cashier pays all expenses 
B
petty cashier pays money to the accountant 
C
petty cashier regularly begins each period with the same amount of money 
D
main cashier accounts to the petty cashier for some experiences made by him 
Explanation.
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An imprest system is aSelf-checkingaccountwhere a fixedbalanceis maintained by regular replenishments and used for paying small, routine operating expenses. Also calledImprest account,Imprestfund, petty cashaccount, or petty cash fund,.


Correct Option:
C
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Question 4
A
carriage inwards 
B
carriage outwards 
C
discounts allowed 
D
discounts received 
Explanation.
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Discount recievedappear as acrediton theProfit and Loss Account. Basically, the cashdiscount receivedjournalentry isacredit entrybecause it represents a reduction in expenses.


Correct Option:
D
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Question 5
A
sales day book 
B
purchases day book 
C
returns inwards book 
D
petty cash book 
Explanation.
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Apetty cashis acash bookused to enter all small orpettyexpenses obtained. Forexampletea, Xerox copy etc. Thepetty cash bookis to enter how thecashavailable for daily expenses are spent forexamplemilk, tea, taxi charges and postage.


Correct Option:
D
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Question 6
A
customer's account; credit bank account 
B
bank account; credit customer's account 
C
customer's account; credit sales account 
D
sales account; credit customer account 
Explanation.
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Treatment: Before any notice ofchequebeingdishonored: When a supplier (payee) receives achequefrom a customer(drawer) the supplier's cash book is debited and the customer's account in the sales ledger is credited with the amount of thecheque.


Correct Option:
B
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Question 7
A
purchases 
B
assets 
C
sales 
D
profits 
Explanation.
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net turnover- isturnover before VAT and after trade discounts have been deducted.A company may usenet turnoverto measure the total volume of sales


Correct Option:
C
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Question 8
A
selling of goods on credit to a customer 
B
withdrawal of goods by the proprietor for his personel use 
C
cheque paid directly into the bank account by a customer 
D
omission of purchases received from a supplier on credit 
Explanation.
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Acheque paymentisrecorded in the cash bookwhen thechequeis despatched. Thebankonly records such achequewhen it is paid by thebank, which may be several days later. Items such as interest may appear on thebank statementbut are notrecorded in the cash bookas the business is unaware that they have arisen.


Correct Option:
C
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Question 9
A
an error of omission 
B
a compensating error 
C
an error of commision 
D
an error of principal 
Explanation.
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error of commission; isa mistake that consists of doing something wrong, such as including a wrong amount, or including an amount in the wrong place:When a transaction has been miss-recorded either wholly or partially


Correct Option:
C
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Question 10
A
journal proper 
B
petty cash book 
C
sales day book 
D
purchase day book 
Explanation.
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The journal proper is in recording books with original entries used for miscellaneouscredit transactionsthat do not fit into other recorded books. The journal is maintained like a simple journal to recordopeningentries,closing entries,transfer entries,adjustment entries,rectification entries, and rare transactions.


Correct Option:
A
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