Tag: elements of book keeping and accountancy

Questions Related to elements of book keeping and accountancy

Which of the following are the salient features of bank reconciliation statement?

elements of book keeping and accountancy bank reconciliation statement understand the concept of bank reconciliation statemen bank balance, bank overdraft, meaning, and bank reconciliation statement accounting records

  1. Any undue delay in the clearance of cheque will be shown up by the reconciliation

  2. Reconciliation statement will help in finding the person doing'any fraud

  3. It helps in finding out the actual position of the bank balance

  4. (a), (b) and (c) 

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Correct Option: D
Explanation:

Bank reconciliation statement is prepared to reconcile the balances as per cash book (bank balance) and pass book (bank statement) by identifying the causes of differences between the two. So, in other words, any undue delay in the clearance of the cheque will be shown. If any fraud is happening, it will show up when the balances would not match. And, it will also help us arrive at the actual position of the bank balance.

So (a), (b) and (c).

The amount paid to the petty cashier at the beginning of a period is known as __________ amount.

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. Imprest

  2. Credit

  3. Idle

  4. None of these

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Correct Option: A
Explanation:
Imprest - It is a fund used by a business for small items of expenditure, and restored to a fixed amount periodically.
Hence, a petty cash book is kept on the imprest amount.

Which of the following statements is/are true ? 
(i) Cash book records all cash receipts and cash payments
(ii) Cash book records all sale and purchase transactions of goods both in cash and on credit.
(iii) Cash book records discount on cash payments
Select the correct answer from the options given below :-

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. Only (i) of the above

  2. Only (ii) of the above

  3. Only (iii) of the above

  4. Both (i) and (iii) of the above

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Correct Option: D

Petty Cash Book may be treated as a ___________________.

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. Part of the double entry system

  2. Merely as a memoranda book

  3. Either (A) or (B)

  4. None of the above

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Correct Option: C

Which of the following statement is false?
The petty cash book  ____________. 

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. is a book of prime entry

  2. records cheques paid and received

  3. is written up using petty cash receipts and petty cash vouchers

  4. records cash received and paid

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Correct Option: B

Petty cash fund is supposed to be replenished at ________________. 

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. Every day

  2. Every half year

  3. Every Year

  4. At the end of every accounting period

Show answer
Correct Option: D
Explanation:

Petty cash fund is supposed to be replenished at the end of every accounting period.

This is done whenever the amount of actual cash in the petty cash box is low and at the end of each accounting period.

Debiting the petty cash book with the exact amount spent in the previous period is an example of _______________.

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. Contra entry

  2. Imprest system

  3. Going concern

  4. Prudence

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Correct Option: B

When Petty Cash is advanced to the Petty Cashier, the main cashier will record it on the debit side of Cash Book.

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. True

  2. False

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Correct Option: B

Which of the following transactions should be entered in petty cash book?

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. Salary payments

  2. Stock issued

  3. Subscriptions

  4. Travelling expenses

Show answer
Correct Option: D
Explanation:

The petty cash book is a formal summarization of petty cash expenditures, sorted by date. In most cases, the petty cash book is an actual ledger book, rather than a computer record.

Petty cash book is considered as memorandum book.

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. True

  2. False

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Correct Option: A