FAPS Lesson 1 - Starter

Match the following terms to the correct definition

• Capital expenditure

• Capital introduced by the owner

• Revenue expenditure

• Purchase of car insurance for the year

• Revenue income

• Receipts from the sale of goods to customers

• Capital income

• Purchase of an additional property

From the following accounts, select the three accounts that are normally debit balances when generating a trial balance towards the end of a financial year

• Purchases

• Payables ledger control

• Receivables ledger control

• Capital

• Discounts allowed

From the following accounts, select the three accounts that are normally credit balances when generating a trial balance towards the end of a financial year

• Payables ledger control

• Discount received

• Sales

• Wages

• Heating and lighting

Study the summary totals from the sales day book at the end of the month. What will be the entries in the general ledger?

• DR Receivables ledger control £1,200, CR Sales £200, CR VAT £1,000

• DR VAT £200, DR Receivables ledger control £1,000, CR Sales £1,200

• DR Receivables ledger control £1,200, CR Sales £1,000, CR VAT £200

• DR Sales £1,000, DR VAT £200, CR Receivables ledger control £1,200

During the month, you record a purchase invoice to a supplier on credit. This has correctly been recorded in the payables day book. The invoice amount was for £500 to T Traders Ltd.

What will be the entry in the purchase ledger to record this transaction?

• DR T Traders Ltd £500

• CR T Traders Ltd £500

Studying the image, what will be the balance c/d and what side will this be posted on?

• £700 debit entry

• £800 debit entry

• £800 credit entry

• £700 credit entry

Studying the image, what will be the total that will be posted to both sides of the account once the c/d balance has been entered?

• £800

• £700

• £900

• £100

Reorder the five stages of the accounting system from steps 1 - 5 in the correct transactional order

• Book of Prime Entry

• Financial Transaction (e.g. Sale of goods)

• Financial Document (e.g. Sales invoice)

• Trial Balance

• Ledger Accounts