Deck 11: Day Books and the Journal

Question 1

Day books are used:

A) Because of the requirements of the law.
B) To avoid numerous entries in the general ledger
C) Because the double entry system would not work without them
D) Because the profession state that you must use them

Answer 1

To avoid numerous entries in the general ledger

Question 2

Which of the following books is regarded as a ledger?

A) Sales day book
B) Sales ledger
C) Sales returns day book
D) The journal

Answer 2

Sales ledger

Question 3

Details of the transactions on a non-current assets account can be found in:

A) Sales ledger
B) Purchase ledger
C) The nominal ledger
D) The journal

Answer 3

The nominal ledger

Question 4

Which of the following is correct?
When a company receives £500 from B. Nice the following happens:

A) Nice's account in the purchase ledger is credited with £500
B) Nice's account in the purchase day book is credited with £500
C) Nice's account in the sales ledger is credited with £500
D) Nice's account in the sales day book is credited with £500

Question 5

Which of the following is correct?
When goods are returned to B. Quiet worth £800 the following happens:

A) Quiet's account in the purchase ledger is debited with £800
B) Quiet's account in the purchase day book is debited with £800
C) Quiet's account in the sales ledger is debited with £800
D) Quiet's account in the sales day book is debited with £800

Question 6

A supplier sends you a statement showing a balance outstanding of £28,000. Your own records show a balance outstanding of £28,700.
The reason for the difference could be that:

A) You have returned goods worth £700 which the supplier has not yet accounted for
B) The supplier sent an invoice for £700 which you have not yet received
C) You have paid the supplier £700 which he has not yet accounted for
D) The supplier has allowed you a £700 cash discount which you had omitted to enter in your ledgers

Question 7

Which of the following would be recorded in the purchase day book?

A) Discounts received
B) Trade discounts
C) Credit notes received
D) Purchase invoices

Question 8

Which of the following would be recorded in the sales day book?

A) Discounts allowed
B) Trade discounts
C) Credit notes issued
D) Sales invoices

Question 9

.J. Smith returned goods with a value of £2,250 to ABC's stores on 31/12/X0. The double entry to
Record this in ABC's books is as follows:

A) Dr. Sales returns £2,250 Cr. Inventory £2,250
B) Dr. Purchase returns £2,250 Cr. J. Smith account £2,250
C) Dr J. Smith account £2,250 Cr. Sales returns £2,250
D) Dr. Sales returns £2,250 Cr. J. Smith account £2,250

Question 10

J. Smith returned goods with a value of £2,250 to ABC's stores on 31/12/X0. The double entry to record this in J. Smith's books is as follows:

A) Dr. Purchase returns £2,250 Cr. Inventory £2,250
B) Dr. Purchase returns £2,250 Cr. ABC account £2,250
C) Dr ABC account £2,250 Cr. Purchase returns £2,250
D) Dr. ABC account £2,250 Cr. Sales returns Cr. Sales returns

Question 11

The total amount owing from customers is disclosed in:

A) The income statement
B) Other comprehensive income
C) The statement of cash flows
D) The statement of financial position

Question 12

XYZ received an invoice from T. Henry for £1,000, less a 20% trade discount for inventory. The invoice also included terms which stipulated that a cash discount of 5% would be allowed if the invoice was paid within 10 days.
The double entry to record the initial purchase in the books of XYZ is as follows:

A) Dr. Purchases £800 Cr. Discount received £200 Cr. T. Henry account £1,000
B) Dr. Purchases £1,000 Cr. T. Henry £1,000
C) Dr. Purchases £750 Cr. T. Henry £750
D) Dr. Purchases £800 Cr. T. Henry £800

Question 13

XYZ received an invoice from T. Henry for £1,000, less a 20% trade discount for inventory. The invoice also included terms which stipulated that a cash discount of 5% would be allowed if the invoice was paid within 10 days.
The double entry to record the payment within 10 days in the books of XYZ is as follows:

A)
B)
C)
D)

Question 14

XYZ issued an invoice to T. Henry for £10,000, less a 20% trade discount for inventory. The invoice also included terms which stipulated that a cash discount of 5% would be allowed if the invoice was paid within 10 days.
The double entry to record the initial sale in the books of XYZ is as follows:

A)
B)
C)
D)

Question 15

XYZ issued an invoice to T. Henry for £10,000, less a 20% trade discount for inventory. The invoice
Also included terms which stipulated that a cash discount of 5% would be allowed if the invoice was
Paid within 10 days.
The double entry to record the receipt within 10 days in the books of XYZ is as follows:

A)
B)
C)
D)

Question 16

A credit balance of £600 brought down on Vero Ltd's account within the books of Parma Ltd might be because:

A) Parma Ltd. owes Vero Ltd. £600
B) Parma Ltd is owed £600 by Vero Ltd
C) Parma Ltd has paid £600 to Vero Ltd
D) Vero Ltd owes £600 to Parma Ltd