Control accounts
What does the Sales Ledger Control Account show?
It shows the total amount that customers owe to the business.
What is the name of the book that records all the business’s daily financial transactions?
The journal or book of prime entry.
If you have $10 and spend $3, how much do you have left?
7
What chapter contains: Books of prime entry
7
If I flip a coin, will it land on heads or tails?
Heads
Why are control accounts useful to a business?
They help check for errors by comparing totals with the individual customer or supplier accounts.
What is the main difference between capital and revenue expenditure?
Capital expenditure is for long-term assets, while revenue expenditure is for day-to-day costs.
You earn $50 and save 10% — how much do you save?
5
What chapter contains: Other payables and other receivables?
11
If I roll a fair 6-sided die, what number will it land on?
2
Name two types of transactions that are recorded in the Sales Ledger Control Account.
Credit sales and payments received from customers.
Why is the matching principle important in accounting?
It ensures that income and expenses are recorded in the same period.
An item costs $20 and there is a 25% discount — what is the amount of the discount?
5
Which chapter contains: Financial statements
8
Which accounting term am I secretly thinking of: "asset", "liability", "equity", "Depreciation", "Ledger", "Cash", or "none of them"
Liability
What kind of balance does the Purchases Ledger Control Account usually have, and why?
A credit balance, because it shows how much the business owes to suppliers.
What does the prudence (conservatism) principle require accountants to do?
Record expenses and losses as soon as possible but only record gains when they are certain.
If you earn $400 a week and spend $120 on rent, what fraction of your income is spent on rent? Simplify your answer
0.3, 30%, or 3/10
What chapter contains: Journal entries and correction of errors?
15
Pick a number between 1-10
6
If a customer appears in both the Sales and Purchases Ledger, what entry is made in the control accounts?
A contra entry is made to cancel out the amounts owed between the customer and supplier accounts.
How does the accrual basis of accounting differ from the cash basis?
The accrual basis records income and expenses when they happen, not when cash is received or paid.
You invest $1,000 at 5% simple interest per year — how much interest do you earn after 3 years?
150
Which chapter contains: Irrecoverable debts and provisions for doubtful debts?
13
In which month does the financial year end for the mystery company I just invented?
December