Chapter 7 Key words

Question 1

Balance carried down

Answer 1

Term used to describe the balancing figure that makes the column with the smallest figure total the larger figure.

Question 2

Balance Brought Down

Answer 2

The same figure as the bal c/d but used on the opposite side of the account to the bal c/d

Question 3

Capital expenditure

Answer 3

Assets used in the long term

Question 4

Capital income

Answer 4

From sales of assets used in the long term

Question 5

Revenue Income

Answer 5

Receipts from sales and other short-term income such as interest from the bank, rent and commission

Question 6

Subsidiary ledgers

Answer 6

The sales ledger and purchase ledger, which are memorandum ledgers that are not part of the general ledger, contain a ledger account for each individual credit customer or credit supplier

Question 7

Revenue Expenditure

Answer 7

Payments for day-to-day running costs and purchase including wages and interest paid to the bank.