qs i got wrong 3

Question 1

Which of the following best explains the imprest system of petty cash?
A Each month an equal amount of cash is transferred into petty cash.
B The exact amount of petty cash expenditure is reimbursed at intervals to maintain a fixed float.
C Petty cash must be kept under lock and key.
D The petty cash total must never fall below the imprest amount.

Answer 1

3 Correct answer(s):
B The exact amount of petty cash expenditure is reimbursed at intervals to maintain a fixed float.
The imprest system of petty cash requires that the exact amount of petty cash expenditure is
reimbursed at intervals to maintain a fixed float. A business will decide to hold, for example, £200 of
petty cash, which will be used for incidental expenses and will regularly have to top the petty cash in
hand back up to that level to maintain the petty cash balance.

Question 2

River downloads their bank transaction report for the day. The report shows a cash payment of £412
which the computerised accounting system has not been able to match to a transaction.
Requirement
The unmatched payment is most likely the result of:
A the purchase of a new laptop for £412
B payment to a regular credit supplier for an invoice totalling £412
C a receipt from a credit customer in respect of an invoice for £450 on which a prompt payment
discount of £38 was taken

Answer 2

Correct answer(s):
A the purchase of a new laptop for £412
The cash payment represents expenditure. The purchase of a laptop is not a regular transaction, and
it is therefore likely that this wouldn’t be automatically matched by the accounting system. The
payment of a regular supplier for the exact amount of the invoice (B) and the payment of wages
matching the payroll (D) are highly likely to have been matched by the accounting system. Option C
is a receipt, not a payment.

Question 3

Answer 3

11 Correct answer(s):
B £42,100
The wages cost to a business is the employees’ gross pay plus the employer’s national insurance.
£38,600 + 3,500 = £42,100

Question 4

2 Which two of the following are source documents that contain information that will be entered into a
business’s accounting system?
A Goods received note
B Invoice to a customer
C Purchase order to a supplier
D Cheque payment to a supplier
E Delivery note to a customer

Answer 4

12 Correct answer(s):
B Invoice to a customer
D Cheque payment to a supplier
The invoice to a customer and the cheque payment to a supplier are both source documents that
require information to be entered into a business’s accounting system. The purchase order and
goods received note act as supporting documentation when an invoice arrives from a supplier, but
do not themselves contain information that is recorded in the system. Similarly, the delivery note acts
as supporting documentation when preparing an invoice to a customer but is not separately
recorded.