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Test - Original Entry

1. Books of original entry are used to initially record business transactions before posting them to ledger accounts. Common books include sales journals, purchases journals, and cash books. 2. The questions ask about the purpose and use of various books of original entry and business documents like invoices, credit notes, debit notes, and statements of account. It also provides examples of transactions between businesses and asks how they would be recorded. 3. The document seeks to assess understanding of basic bookkeeping concepts like how transactions are initially recorded, the purpose of different books and documents, and how information flows between books of original entry and ledger accounts.

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Sumita Mathias
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401 views4 pages

Test - Original Entry

1. Books of original entry are used to initially record business transactions before posting them to ledger accounts. Common books include sales journals, purchases journals, and cash books. 2. The questions ask about the purpose and use of various books of original entry and business documents like invoices, credit notes, debit notes, and statements of account. It also provides examples of transactions between businesses and asks how they would be recorded. 3. The document seeks to assess understanding of basic bookkeeping concepts like how transactions are initially recorded, the purpose of different books and documents, and how information flows between books of original entry and ledger accounts.

Uploaded by

Sumita Mathias
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOC, PDF, TXT or read online on Scribd

Questions – Books of Original Entry

1. State one advantage of using a book of prime entry


2. State one reason why a business uses a purchases journal
3. State the purpose of each of the following business documents.
a) debit note
b) credit note
4. Explain why some transactions are recorded in the Journal before being entered in the ledger
accounts.
5. What is meant by book of Prime (Original) entry
6. Name the book of Prime (Original) entry which a trader may keep. In each case name a
source document for each book.
Book of Prime Entry Source Document

7. State reasons why a trader might use a book of Prime Entry


8. Farhad and Ali are traders. On 1 January 2015 Farhad owed Ali $300. The following
transactions took place.
5 January Ali sold goods, $250, to Farhad.
8 January Farhad returned half of the goods bought on 5 January.
19 January Farhad paid the amount owed on 1 January, by cheque, having deducted 3%
cash discount
a. Complete the following table. Name the document sent by Ali to Farhad on 5 January and on
8 January and state his reason for sending each document.
Document Reason
5 January
8 January
b. Complete the following table. Name the book of prime (original) entry in which Ali would
record the transactions listed.
Book of prime (original) entry
Ali sold goods, $250, to Farhad
Farhad returned half of the goods bought on
5 January
Farhad paid the amount owed on 1 January
having deducted 3% cash discount

9. a) Insert the missing figures in the following document.


Quantity Description Unit price $ Amount $
4 External doors 55 220

Less (1)...............% 33
trade discount
(ii) ……………

20 meters Floorboards 1.5 30


(iii) ……………
b) Name the person who issued the credit note
c) Suggest one reason for the issue of the credit note.
d) Name the document which would have been issued to request a credit note.
e) Complete the following table to show where the credit note would be recorded.

Account debited Account credited Account debited Account credited

10. The following incomplete statement of account was available on 31 August 2015.
Date Reference Debit Credit Balance
August 2015
01 Balance Due 520.00
9 Goods 340.00 860.00
13 Returns 24.00 ?
24 Payments 507.00 ?
Discount 13.00 ?
STATEMENT OF ACCOUNT
Shahid Ayub
44 Narrow Lane Anytown
Mariam Soliman
The Avenue
Westtown 31 August 2015

a) State the business document and the book of prime (original) entry Shahid Ayub would use
to record the following transactions which appear on the statement of account.
Transaction Document Book of prime (original)
entry
August 9 Goods

13 Returns

24 Payment

11. Paul Chew sells goods on credit terms to Kim Chan.


Complete the table to name the business document and the books of prime (original) entry
for each of the following transactions.
If the document is not recorded in a book of prime (original) entry write “No entry.” The first
transaction has been completed as an example. Turn page.

Document Paul Chew’s book Kim Chan’s book of


of prime (original) prime (original)
entry entry
Paul Chew received Cheque Cash book Cash book
payment from Kim Chan
Paul Chew sold goods
on credit to Kim Chan
Kim Chan notified Paul
Chew of an overcharge
Paul Chew notified Kim
Chan that he agreed the
overcharge

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