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Bookkeeping > Bookkeeping Controls > Flashcards

Bookkeeping Controls Flashcards

1
Q

What costs make up the Wages Expense?

A

Gross Pay + ERNI (National Insurance) + ER Pension Contribution

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2
Q

What deductions come from employees pay?

A

PAYE, EENI (National Insurance), EE Pension Contributions, Voluntary Deductions e.g. charity

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3
Q

What is net pay?

A

Gross pay minus deductions (PAYE, EENI, EE Pension, Voluntary Deductions)

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4
Q

How to write irrecoverable debt with VAT

A

Irrecoverable debt - DEBIT
VAT - DEBIT
SLCA - CREDIT

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5
Q

What is error of omission?

Does is affect Trial Balance?

A

Transaction not entered at all, anywhere

No

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6
Q

What is error of principle?

Does is affect Trial Balance?

A

Transaction is entered into the wrong type of account.

No.

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7
Q

What is error of commssion?

Does is affect Trial Balance?

A

Transaction is entered into the wrong account but same type e.g. office expenses is entered into rent.
No

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8
Q

What is error of original entry?

Does is affect Trial Balance?

A

Wrong figure has been entered correctly into debit & credit.

No.

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9
Q

What is reversal of entries?

Does is affect Trial Balance?

A

Correct figure/same figure has been entered to wrong side of both accounts involved.
No/

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10
Q

What is a compensating error?

Does is affect Trial Balance?

A

Two separate errors equal each other out.

No.

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11
Q

What is a calculating error in accounts?

Does is affect Trial Balance?

A

E.g. an error when adding up figures & balancing a ledger account
Yes

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12
Q

What is a single entry transaction?

Does is affect Trial Balance?

A

Entering a debit but not a credit or vice versa.

Yes

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13
Q

Does using two debits or two credits affect trial balance?

Give an example

A

Yes

E.g. Crediting rent recieved and also crediting the bank (when is should be debit)

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14
Q

Does entering different amount on the debits & credits affect trial balance?
Give an example

A

Yes.

E.g. entering £45 in debit and £54 in credit.

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15
Q

Would making an error in transferring an account balance the trial balance affect it?
Give an example

A

Yes

E.g entering £5000 instead of £500

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16
Q

Would omitting a general ledger account in the trial balance affect it?

A

Yes

Leaving an account out of the TB completely.

17
Q

What is DEAD CLIC?

A

Debit - Expenses, Assets & Drawings

Credit - Liabilities, Income & Capital

18
Q

What is the formula for irrecoverable debts?

A

Debit - Irrecoverable Debts
Debit - VAT
Credit - SLCA

19
Q

What is the layout for balancing accounts?

A

Bal c/d
Total
Bal b/d

20
Q

What do you do with outstanding lodgements and unpresented cheques?

A

ADD outstanding lodgements

MINUS unpresented cheques

21
Q

What is the layout for the Wages Control Account?

What do the Bank and HMRC transactions consist of?

A 
CREDIT - WAGES EXPENSE
DEBIT - Everything else
(Bank, HMRC, Pension Fund, Trade Union Fees, Charity Contributions)
Bank - Net employees pay
HMRC - Income tax, EENI, ERNI
22
Q

What type of account is an SLCA?

What are the debits and credits?

A

ASSET account
DEBIT - Balance b/d, (credit customer) sales. returned cheque
CREDIT - Bank (receipts), (credit customer) sales returns, discounts allowed, irrecoverable debts, balance c/d

23
Q

What type of account is the PLCA?

What are the debits & credits?

A

LIABILITY account
DEBIT - Bank (payments), (credit customer) purchase returns, Discounts received, Balance c/d
CREDIT - Balance b/d, (credit customer) purchases

24
Q

When is the company owed VAT and when does it owe it, and do they debit or credit the VAT control account?

A

Owed VAT on purchases - DEBIT CONTROL ACCOUNT

Owes VAT on sales - CREDIT CONTROL ACCOUNT

25
Q

What are the debits of the VAT control account?

A

Sales Returns, credit Purchases, Discounts allowed, Cash purchases, petty cash & irrecoverable debts

26
Q

What are the credits of the VAT control account?

A

Credit sales, purchase returns, discounts recieved, cash sales

27
Q

Where do the c/d and b/d balances have to be for the company to OWE VAT?

A

Owing is a liability - c/d is in debit and b/d is in credit

28
Q

Where do the c/d and b/d balances have to be for the company to BE OWED VAT?

A

Being owed VAT is an ASSET - c/d is in credit and b/d is in debit

29
Q

What 8 things do I need to write down at the beginning of the exam?

A

DEAD CLIC
How to balance accounts (where to put c/d & b/d)#
Irrecoverable debts layout
ADD outstanding lodgements, MINUS unpresented cheques
SLCA type of account (ASSET) and layout
PLCA type of account (LIABILITY) and layout
Wages control account layout - (WAGES EXPENSES ARE CREDIT)
Vat Control Account layout & MONEY PAID IS DEBIT MONEY RECEIVED IS CREDIT

30
Q

What is PAYE, who bears the cost and who is responsible and who is it paid to?

A

Pay As You Earn
Income tax is collected by employer from employee and deducted from employee before net pay. Employer pays HMRC on a monthly basis.

Bookkeeping (1 decks)

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