AAT L2 Bookkeeping Controls 2

Question 1

A direct debit appearing on the bank statement but not in the cash book is an example of:

Accepted Answer

An item requiring adjustment to the cash book

Answer

An unpresented cheque

Answer

An outstanding lodgement

Answer

A bank error

Question 2

A purchase ledger control account reconciliation revealed that a contra entry of £250 was recorded in the purchase ledger control account but not in the individual supplier account. To correct this, the entry required is:

Accepted Answer

Debit the supplier's account with £250

Answer

Credit the supplier's account with £250

Answer

Debit the purchase ledger control account with £250

Answer

No entry is needed in the control account

Question 3

Which of the following is the correct journal entry to write off an irrecoverable debt of £600 (net of VAT) where VAT at 20% was charged on the original sale?

Accepted Answer

Debit Irrecoverable Debts £600, Debit VAT £120, Credit Trade Receivables £720

Answer

Debit Irrecoverable Debts £720, Credit Trade Receivables £720

Answer

Debit Irrecoverable Debts £600, Credit Trade Receivables £600

Answer

Debit Trade Receivables £720, Credit Irrecoverable Debts £600, Credit VAT £120

Question 4

The purpose of a journal is to:

Accepted Answer

Record non-regular transactions and provide a narrative explanation

Answer

Record daily cash transactions

Answer

List the closing balances of all accounts

Answer

Record all credit purchases

Question 5

After completing a bank reconciliation, the adjusted cash book balance should agree with:

Accepted Answer

The bank statement balance after accounting for timing differences

Answer

The opening balance on the next bank statement

Answer

The purchase ledger control account balance

Answer

The petty cash balance

Question 6

An error of commission occurs when:

Accepted Answer

A transaction is posted to the correct type of account but the wrong specific account

Answer

A transaction is recorded at the wrong amount

Answer

A transaction is posted to the wrong type of account entirely

Answer

A transaction is completely left out of the books