Topic - Cash

Journal entries for recording payment to credit supplier are shown as Dr __, Cr ___

• Cash, Trade payables

• Cash in hand, trade payables

• Cash at bank, trade payables

• Trade payable, cash at bank

Causes for dishonoured cheque does not include...

• cheque has expired

• payer's bank account is frozen

• information on cheque is not complete

• cheque is rejected

When a cheque deposited is dishonoured, the business will Dr __ , Cr ___

• cash at bank, trade receivable

• trade receivable, cash at bank

• cash at bank, cash in hand

• trade receivable, cash in hand

A cheque is considered expired if it is dated more than ___ months ago and is no longer valid.

• 3

• 6

• 9

• 12

A credit customer is given cash discount when he paid to the business.

When the cheque is dishonoured, what are the ___ accounts being reversed?

• cash at bank, trade payable, discount received

• cash at bank, trade receivable, discount received

• cash at bank, trade receivable, discount allowed

• cash at bank, trade payable, discount allowed

What types of discounts have to be recorded in the ledger accounts?

• Trade discount

• Cash discount

• Discount allowed

• Discount received

Cash discounts are given to the credit customers when they buy goods in bulk.

• True

• False

A bank account is frozen when it does not have sufficient fund in the account.

• True

• False

Internal controls are policies and procedures established to:

• safeguard assets of the business

• comply with laws and regulations

• ensure business transactions are recroded accurately

• all of the above

Which one is not an internal control for cash management?

• Secured cash and cheque in a locked storage

• Obtain proper approvals for all payments from authorised personnel

• No need to have segregation of duties.