AAT L3 Accounts Payable & Receivable Advanced 1

Question 1

The aged receivables report is used to:

Accepted Answer

Identify how long customer invoices have been outstanding, aiding credit control

Answer

An aged receivables (debtors) report categorises outstanding customer invoices by age (e.g., 0–30 days, 31–60 days, 61–90 days, over 90 days), helping the credit control team prioritise collection activity.

Question 2

A statement of account sent to a customer is used to:

Accepted Answer

Confirm the balance owed by the customer, listing all invoices, payments, and credits

Answer

A statement of account summarises all transactions between the business and the customer — invoices raised, payments received, and credit notes issued — confirming the net outstanding balance due.

Question 3

A credit limit for a customer should be set based on:

Accepted Answer

An assessment of the customer's creditworthiness, payment history, and financial position

Answer

Credit limits should reflect the customer's ability to pay — assessed using credit references, payment history, financial statements, and credit agency reports — to manage the risk of bad debts.

Question 4

When a supplier sends a statement of account, the purchase ledger team should:

Accepted Answer

Reconcile it against the purchase ledger to identify discrepancies

Answer

Supplier statement reconciliation is an important internal control; by comparing the supplier's statement to the purchase ledger, the team can identify invoices not yet posted, disputed items, or timing differences.

Question 5

Which document authorises the payment of a purchase invoice?

Accepted Answer

Authorised payment schedule or approved purchase invoice

Answer

Before paying a supplier, the invoice should be matched against the purchase order and goods received note (three-way match), then formally approved/authorised by an appropriate manager before payment is processed.

AAT Level 3 Practice Test

AAT Level 3 Practice Test

AAT L3 Accounts Payable & Receivable Advanced 1