Question 1

Indicate by choosing the correct option whether the following statement is true or false:

An electronic funds transfer made by a debtor of HS Stores on 12 June 20.1, is an example of an item that will appear on the bank statement of HS Stores but not in the cash receipts journal of HS Stores for June 20.1.

True

False

Question 2

Indicate by choosing the correct option whether the following statement is true or false:

The creation of an allowance for credit losses is done because the entity anticipates that some debtors may not pay their accounts.

True

False

Question 3

Credit losses recovered will be disclosed as a /an in the financial statements of an entity.

A. non- current asset

B. current asset

C. income

D. expense

E. current liability

Question 4

Ms B Khumalo, a tenant, of HS Stores has listed HS Stores as a beneficiary on her bank account. This enables her to make provision for a scheduled payment to pay the monthly rent to HS Stores via the ATM on the 1st of every month. In which journal will the bookkeeper of HS Stores enter the above the transaction?

A. cash payments journal

B. sales journal

C. cash receipts journal

D. purchases journal

E. petty cash journal

Question 5

Inventory sold on credit will be recorded in thejournal.

A. general

B. sales

C. cash payments

D. cash receipts

Question 6

HS Stores purchased equipment on credit from RG Traders for R11270 (inclusive of 15% VAT). The VAT input amount (rounded off to the nearest rand) on this credit purchase is

A. R1 384

B. R9 800

C. R1 470

D. R1 578

E. R1 691

Question 7

A sales invoice for R750 was entered twice in the sales column of the sales journal and was posted twice to the personal account of a debtor, Mr T Maharaj. The transaction will be corrected by processing the following journal entries:

A. Debit sales account with R750 and debit the account of Mr T Maharaj with R750.

B. Credit sales account with R750 and credit the account of Mr T Maharaj with R750.

C. Debit sales account with R1 500 and credit the account of Mr T Maharaj with R1 500.

D. Credit sales account with R1 500 and debit the account of Mr T Maharaj with R1 500.

E. Debit sales account with R750 and credit the account of Mr T Maharaj with R750