Tag: book keeping and accountancy

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Questions Related to book keeping and accountancy

Multiple choice book keeping and accountancy banking transactions and accounts relating to cheque functions and services of modern banking meaning of passbook and cashbook journal entries for transactions through bank and for loans

When credit balance as per pass book is the starting point, interest allowed by bank is?

  1. Subtracted

  2. Not required to be adjusted

  3. Added

  4. None of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

In case of interest allowed by bank, the entry for the same would have been entered in the pass book due to which the pass book balance would be higher than the cash book balance.

So, when credit balance as per pass book is the starting point, interest allowed by bank is to be subtracted.

Multiple choice book keeping and accountancy banking transactions and accounts relating to cheque functions and services of modern banking meaning of passbook and cashbook journal entries for transactions through bank and for loans

When the balance as per pass book is the starting point, uncollected cheques are ________.

  1. added in the bank reconciliation statement

  2. subtracted in the bank reconciliation statement

  3. not required to be adjusted in the bank reconciliation statement

  4. neither of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

In case of uncollected cheques  the entry for the same is already made in the cash book due to which the cash book balance becomes higher. 

So, when the balance as per pass book is the starting point, uncollected cheques by bank are added in the bank reconciliation statement.

Multiple choice book keeping and accountancy banking transactions and accounts relating to cheque functions and services of modern banking meaning of passbook and cashbook journal entries for transactions through bank and for loans

A bank statement is a copy of __________ .

  1. a customer's account in the bank's book

  2. a debtors acoount in pass book

  3. cash column of the cash book

  4. none of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A bank statement is a printed record of all the transactions that take place in a customer's account. The bank maintains customers account in its books of account and the same is presented to the customer in the form of a statement to the customer to check balances, additions and subtractions in the bank account .   

Multiple choice book keeping and accountancy banking transactions and accounts relating to cheque functions and services of modern banking meaning of passbook and cashbook journal entries for transactions through bank and for loans

Features of book keeping one.

  1. Mechanical recording

  2. Repetitive recording

  3. Record keeping of all money transactions

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Bookkeeping involves the mechanical, repetitive, and systematic recording of all financial transactions in monetary terms.

Multiple choice book keeping and accountancy banking transactions and accounts relating to cheque functions and services of modern banking meaning of passbook and cashbook journal entries for transactions through bank and for loans

When the balance as per pass book is the starting point, direct payments by bank are __________ .

  1. added in the bank reconciliation statement

  2. subtracted in the bank reconciliation statement

  3. not required to be adjusted in the bank reconciliation statement

  4. neither of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

In case of direct payments by bank the entry for the same is already made in the pass book due to which the pass book balance becomes higher. So, when the balance as per pass book is the starting point, direct payments by bank are added in the bank reconciliation statement.

Multiple choice book keeping and accountancy banking transactions and accounts relating to cheque functions and services of modern banking meaning of passbook and cashbook journal entries for transactions through bank and for loans

From the following information calculate balance as pass book.
- Balance as per cash book (Dr.) $1,900$
- Cash deposited in bank for Rs. $100$ entered in cash book as $Rs.90$
- Transfer to wife's bank account not entered in cash book $Rs.1,500$
- Bank charges not recorded in cash book $Rs.20$
- Standard order payment $Rs.30$

  1. Rs. $440$

  2. Rs. $260$

  3. Rs. $3,320$

  4. Rs. $360$
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The reconciliation is as follows :

   Particulars Amount in Rs. 
   Balance as per cash book (Dr.) $1900$ 
 Add Cash deposited in bank and less amount entered in cash book   $10$ 
 Less Transfer to saving account not entered in cash book  $1500$ 
 Less Bank charges not recorded in cash book  $20$ 
 Less Stand order payment by bank  $30$ 
   Balance as per pass book (Cr.) $360$
Multiple choice book keeping and accountancy banking transactions and accounts relating to cheque functions and services of modern banking meaning of passbook and cashbook journal entries for transactions through bank and for loans

Statement I:
Receipts & Payment A / c starts with the opening balance of cash in hand and at bank.
Statement II :
Income & Expenditure A / c have no opening balance.
Select the correct answer from the options given below.

  1. Statement I is correct while statement II is incorrect.

  2. Both Statement I and II are incorrect.

  3. Statement II is correct while statement I is incorrect.

  4. Both Statement I and II are correct.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
  • Receipts and Payment A/c. is an account which record the payments done and receipts received in cash. It is similar to the cash account maintained in a business. The entries found in this account are opening balance of cash, to this the cash receipts are added and the cash payments are deducted and the remaining figure is the closing cash balance.
  • Income and Expenditure A/c. is nothing but another name for a Profit & Loss account. Income and Expenditure name is mostly used by non-business entities, but still all the principles are same as a Profit & Loss account. This account only records the expenses and income for a particular financial year and hence doesnt have any opening balance of any sorts.
Multiple choice book keeping and accountancy banking transactions and accounts relating to cheque functions and services of modern banking meaning of passbook and cashbook journal entries for transactions through bank and for loans

The bank statement shows as overdrawn balance of Rs. 2,000. A cheque for Rs. 500 drawn in favour of a credit has not yet been presented for payment. When the creditor presents the cheque for payment, the bank balance will be ___________ .

  1. Rs. 1,500

  2. Rs. 2,500

  3. Rs. 1,500 (overdrawn)

  4. Rs. 2,500 (overdrawn)
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
When balance as per passbook is the starting point adjustments are to be made in the passbook. Unpresented cheques are the cheques which are issued to a person and he/she has not presented it for payment. In this case the cash book is credited by the cheque issued and passbook is not so the cash book balance is less than passbook, hence unpresented cheques are subtracted from the passbook balance. 
Hence balance as per pass book is negative 2000 when unpresented cheques are presented the overdrawn balance will be (2500).
Multiple choice book keeping and accountancy banking transactions and accounts relating to cheque functions and services of modern banking meaning of passbook and cashbook journal entries for transactions through bank and for loans

Which of the following item is not be appear in the Bank Reconciliation Statement if the balance as per Amended Cash Book is taken as the starting point.

  1. Uncollected cheques

  2. Unpresented cheques

  3. A wrong entry in the Pass Book

  4. A correct entry in the Pass Book but not appearing in Cash Book
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

An amended cash book is where all the adjustments are done, the starting point being the balance as per cash book. All the errors in the cash book are adjusted in the same. Hence, a wrong entry in a pass book won't appear in a cash book as it is not an error or omission in the cash book.

Multiple choice book keeping and accountancy banking transactions and accounts relating to cheque functions and services of modern banking meaning of passbook and cashbook journal entries for transactions through bank and for loans

Which of the following items is not to be adjusted in the Amended Cash Book:

  1. Bank Charges and Interest charged by Bank

  2. Interest allowed and direct Payments by Bank

  3. Direct payment by our Debtors into the bank

  4. A wrong entry in the Pass Book.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

An amended cash book is where all the adjustments are done, the starting point being the balance as per cash book. All the errors in the cash book are adjusted in the same. In the given question all the errors are cash book errors or omission except a wrong entry in the pass book. This error has to be adjusted in the passbook and not the cash book.