ACCN1

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A-Levels Accounting Flashcards on ACCN1, created by amierosepickering on 11/05/2013.
amierosepickering
Flashcards by amierosepickering, updated more than 1 year ago
amierosepickering
Created by amierosepickering over 11 years ago
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Resource summary

Question Answer
Credit Note a document sent to a customer showing allowance given by a supplier in respect of unsatisfactory goods
Credit Transfers Electronically transferring money from one bank to another
Direct Debit payments made automatically from one bank to another, this is a variable amount set buy the person receiving the money
Standing Order a set amount of money automatically paid from one bank to another on a fixed date
Cash Receipt Receipts given to a customer as proof of purchase
Till Rolls paper inside the till which produces a receipt for the customer and another copy for the shop
Paying-in Slip Counterfoil a form used for paying money into a bank account in the same bank
Invoices record of sale/purchases
Cheque Counterfoils small part of a cheque which holds details of a transaction
Partial Omission (Error Revealed by Trial Balance) omission of one part of the double entry
Unequal Posting Error (Error Revealed by Trial Balance) recording two debits or two credits for one transaction
Addition Error (Error Revealed by Trial Balance) Error in calculating balances
Posting Error (Error Revealed by Trial Balance) errors in transferring the balances to the trial balance
Error of Omission a transaction has been completely missed out
Error of Commission Right type of account but wrong persons
Error of Principle wrong type of account all together
Compensating Error (Error not revealed but trial balance) Two errors of separate transactions randomly cancel each other out
Error of Original Entry (Error not revealed but trial balance) Original figure entered is incorrect
Complete Reversal of Entry (Error not revealed but trial balance) Debit and Credit entries the wrong way around
Reasons for Trial Balance 1. Its used to complete the final accounts 2.Checks that accounts have been balanced off correctly 3.Its a way or checking that all financial transactions have a debit and credit entry
Reasons for a Bank Reconciliation 1. Enables the cashbook to be corrected for bank entries 2.Enables out of date cheques to be cancelled 3.Enables the Bank Statement to be corrected by informing the bank 4. Acts as a deterrent to fraud as the Bank Statement is an independent source document
Reasons for a Suspense Account It allows you to deal with the errors found by a trial balance
Reasons for a control account 1. A quicker way to find out how much a business is owed. 2. Preventing fraud-makes it more difficult to write off debt 3. Location of errors 4.Preparation of final accounts
Limitations of Control Accounts Does not find: Error of omission Error of commission Error of original entry Compensating error
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