Bookkeeping Controls Flashcards
6 cards from real AAT L2 practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Bookkeeping Controls flashcards as text
A business receives a bank statement showing bank charges of £45 and interest earned of £12 that have not been recorded in the cash book. After adjusting the cash book, the net effect on the cash book balance is:
Answer: Decrease of £33
Bank charges reduce the balance (credit the cash book) by £45, and interest earned increases the balance (debit the cash book) by £12. Net effect: -£45 + £12 = -£33, a decrease of £33.
The purchase ledger control account has a credit balance of £22,400. A supplier invoice for £800 was recorded in the individual supplier account but was not posted to the control account. After correction, the control account balance will be:
Answer: £23,200
A purchase invoice increases the amount owed to suppliers. The control account should be credited with £800 to reflect the missing posting: £22,400 + £800 = £23,200.
An aged trade receivables analysis is used to:
Answer: Monitor how long debts have been outstanding and identify potential irrecoverable debts
An aged trade receivables analysis categorises outstanding customer balances by the length of time they have been owed (e.g., 0-30 days, 31-60 days, over 90 days). This helps identify slow-paying customers and potential bad debts requiring write-off or provision.
A standing order of £150 per month for rent appears on the bank statement but has not been entered in the cash book. The journal entry to correct the cash book is:
Answer: Debit Rent £150, Credit Bank £150
The standing order is a payment for rent that the bank has processed but the business has not recorded. The cash book needs updating: debit Rent (the expense) and credit Bank (reducing the cash book balance).
Which of the following is NOT a purpose of control accounts?
Answer: To replace the need for a trial balance
Control accounts verify the accuracy of subsidiary ledgers, help detect errors and fraud, and provide summary figures for financial statements. However, they do not replace the trial balance — the trial balance serves a separate purpose of checking overall double entry accuracy.
A receipt from a customer of £1,250 was correctly entered in the cash book but posted to the sales ledger control account as £1,520. The correcting entry is:
Answer: Debit Sales Ledger Control Account £270, Credit Suspense £270
The sales ledger control account was credited with £1,520 instead of £1,250 — it was overcredited by £270. To correct this, debit the sales ledger control account by £270 (reducing the excess credit). The suspense account was used for the original imbalance and is now credited to clear it.