AAT L3 Advanced Bookkeeping 3

Question 1

Which of the following errors would be corrected using a suspense account?

Accepted Answer

A single-sided entry that causes a trial balance difference

Answer

An error of principle

Answer

An error of omission

Answer

An error of commission

Question 2

Bank reconciliation is performed to:

Accepted Answer

Agree the cash book balance with the bank statement balance by identifying differences

Answer

Check whether the business has a bank overdraft

Answer

Calculate the total of outstanding invoices

Answer

Prepare the year-end financial statements

Question 3

An outstanding lodgement on a bank reconciliation means:

Accepted Answer

A receipt has been recorded in the cash book but not yet credited by the bank

Answer

A cheque has been paid out but not yet presented to the bank

Answer

A direct debit has not yet been recorded in the cash book

Answer

A bank charge has been omitted from the cash book

Question 4

What is the double entry when a business receives a cash refund from a supplier?

Accepted Answer

Debit Bank, Credit Purchase Ledger Control Account

Answer

Debit Bank, Credit Sales

Answer

Debit Purchases, Credit Bank

Answer

Debit Cash, Credit Capital

Question 5

Irrecoverable debts (bad debts) written off are recorded as:

Accepted Answer

Debit Irrecoverable Debt Expense, Credit Trade Receivables

Answer

Debit Trade Receivables, Credit Irrecoverable Debt Expense

Answer

Debit Cash, Credit Trade Receivables

Answer

Debit Irrecoverable Debt Expense, Credit Cash

Question 6

When bank interest is received and recorded in the cash book but has not yet been entered in the general ledger, what type of error has occurred?

Accepted Answer

Error of omission

Answer

Error of transposition

Answer

Error of principle

Answer

Single-sided entry