Reconciliations and Asset Disposal

The statement indicated that permission was granted to Safe Insure to receive a monthly payment for insurance from the current account of Best Traders. This is known as a/an:

• debit order

• stop order

• EFT

• cheque

The statement indicated two interest entries, one debit entry for R200 and one credit entry for R300. The correct entries that the accountant has to make in the financial records of Best Traders are

• debit interest on current account with R200 and credit interest on overdraft with R300.

• credit interest on current account with R300 and debit interest on overdraft with R200.

• debit or credit either interest on current account or interest on overdraft with the net result of R100.

• no entry, as there is an error on the bank statement because the bank statement can’t reflect both a debit and a credit entry for interest.

Which of the following procedures best describes the reconciliation of cash?

• The bank balance on 31 January 2022 in the General Ledger is compared to the end balance of the bank statement received.

• The bank balance on 28 February 2022 in the General Ledger is compared to the opening balance of the bank statement received.

• Cash deposits in the CRJ are compared to the credit entries on the bank statement to ensure that cash deposited corresponds.

• Cash deposits in the CRJ are compared to the debit entries on the bank statement to ensure that cash deposited corresponds.

Wok This Way owes an amount of R20 000 to a creditor. A discount of R400 is received for early settlement of the account.

• • - 400 asset

  • - 400 equity

• • + 400 asset

  • + 400 equity

• • + 400 equity

  • - 400 liabilities

• • - 400 equity

  • + 400 liabilities

The EFT amount for settling the account is:

• R20 800

• R20 400

• R20 000

• R19 600

Eggcellent Eats, a wholesaler, supplies goods on credit to Thai Tanic. A credit note was issued to Thai Tanic for the omission of trade discount on the last invoice sent to them. The accountant of Eggcellent Eats recorded the credit note incorrectly as an invoice in the account of Thai Tanic. Which entry must the accountant of Eggcellent Eats make in the account of Thai Tanic to rectify the error?

• Debit the account with the amount of the credit note.

• Debit the account with double the amount of the credit note.

• Credit the account with the amount of the credit note

• Credit the account with double the amount of the credit note.

Which of the following entries best reflect the correction(s) that Lord of the Fries has to make in their subsidiary ledger?

• Credit the account of Phat Tato in the Creditors Ledger.

• Credit the account of Phat Tato in the Debtors Ledger

• Debit the account of Phat Tato in the Creditors Ledger.

• Debit the account of Phat Tato in the Debtors Ledger

What was the amount of discount calculated by Lord of the Fries?

• R570

• R600

• R228

• R114

Time to Dye is a hairdresser. Anne, the owner, debited one of her clients, Sally’s account twice. Sally has paid the full amount owed as she did not pick up on the error. The accountant identified the error. Which entry must Anne make?

• No entry must be made, as Sally did not pick up on the error.

• Debit Sally's account with the amount incorrectly debited.

• Credit Sally's account with the amount incorrectly debited.

• Credit Sally's account with double the amount incorrectly debited.

What would the NET EFFECT on the accounting equation be?

• • - 552 000 on asset

  • + 48 000 on equity

  • - 600 000 on liabilities

• • - 407 000 on asset

  • + 193 000 on equity

  • - 600 000 on liabilities

• • - 552 000 on asset

  • - 48 000 on equity

  • + 600 000 on liabilities

• • + 407 000 on asset

  • - 193 000 on equity

  • + 600 000 on liabilities