Mr T Jeyabalan

Question 1

There are 8 source documents. What are they?

Answer 1

1. Bank statement
2. Cash receipt
3. Cheque counterfall
4. Credit note
5. Paying in slip counterfall
6. Purchase invoice
7. Sales invoice
8. Till roll

Question 2

Items on a bank statement

Answer 2

1. Bank charges
2. Credit transfer
3. Debit card transaction
4. Direct debit
5. Dishonoured cheque
6. Standing order

Question 3

Standing order

Answer 3

A business instructs its bank to make regular payments for the same amount each month

Question 4

Direct debit (hint authorisation of payments)

Answer 4

One business authorises another to take payments out of its bank account, the amount depending on how much is owed

Question 5

Dishonoured Cheque

Answer 5

When a bank refuses to process a cheque you have submitted for multiple reasons

Question 6

What is a standing order
When can you use it?

Answer 6

It allows the bank to take money regularly from your account to pay another account. You can use a standing order for many payment types, including:

Transferring money between your accounts
Sending a friend or family member money on a regular basis
Paying your rent or mortgage
Donating to a charity

Question 7

Credit transfer

Answer 7

Receipts or payments directly in or out of the bank account

Question 8

What is trade discount

Answer 8

Discount that is offered for buying in bulk

Question 9

What is Cash discount

Answer 9

Discount that is offered from business to customer to encourage quick payment

Question 10

What reasons can result in a dishonoured cheque

Answer 10

Insufficient funds in the account, mismatched signatures, errors in the date

Question 11

What are bank charges. When do they happen

Answer 11

Fees bank deduct from a business for using the services they provide.
They happen when an account is overdrawn or a cheque, direct debit or standing order bounces

Question 12

What does overdrawn mean

Answer 12

When you have spent more money than you have in your account. You become indebted to the bank.

Question 13

Sales invoices

Answer 13

Issued by the seller for goods sold on credit

Question 14

Purchase invoices

Answer 14

Received by the buyer for goods bought on credit

Question 15

What is a Cheque counterfoil

Answer 15

The small section of a cheque that remains attached to the cheque book after a cheque has been issued.

Proves record of cheques paid by the business

Question 16

Pay in counterfoils
What are they & what do they show

Answer 16

The part of the pay-in book kept by the business after banking money.
Shows date and amount

Question 17

Cash receipts

Answer 17

The receipts for goods/services which have been paid for when purchased (by cash, cheque or debit card)

Question 18

Till rolls

Answer 18

The amounts sold and paid for during a specific day and the total value of cash sales during that day

Question 19

Bank statements

Answer 19

Sent to the business by their banks. Shows
- each individual receipt and payment
- balance in the bank account