FAPS Lesson 2 - Starter

Match the following

• Asset

• 
• Income (revenue)

• 
• Liability

• 
• Expense

• 

Payment of telephone expenses by bank transfer will be posted as a ​ ​ (a)   to the telephone expenses ​ account and a ​ (b)   to the ​ bank account

• debit
• credit

Your colleague has messaged you to let you know that they have posted a sales invoice on the system. The amount that should have been posted was £56. However, this has been posted to the correct accounts but £65 was used.

This is known as an error of ​ (a)  

• original entry
• comission
• omission
• reversal
• principle

Goods that were sold on credit have been entered as a debit to the account of T H Hughes rather than T L Hughes in the receivables ledger.

This is known as an error of ​ ​ (a)   .

This type of error ​ (b)   be disclosed by the trial balance

• commission
• will not
• omission
• reversal
• principle
• will

Which one of the following would normally have a credit balance?

• Payables ledger control account

• Discounts allowed

• Vehicles at cost

• Administration expenses

• Purchases

Income minus ​ (a)   equals ​ (b)  

• expenses
• profit or loss
• assets
• liabilities
• capital

Vehicles at cost is an example of an ​ (a)   whereas vehicle expenses (e.g. Fuel) is an example of an ​ (b)   .

When an owner invests money into the business, this is a type of (c)   transaction. However, if the owner takes money out of the business this would be in the form of ​ (d)  

• asset
• expense
• capital
• drawings
• liability
• bank
• profit
• loss

Using the account names below, highlight statement of profit and loss accounts in green and statement of financial position accounts in red