IGCSE Accounting Paper-1: Specimen Questions with Answers 109 - 111 of 214

Passage

Susan’s statement was as follows:

WESTERN COMMERCIAL COMPANY

STATEMENT OF ACCOUNT

Western Commercial Company.

Shows given table is Western Commercial Company statement of account.

Date

Particular

Dr

$

Cr

$

Balance

$

September 1

Balance b/f

4000.00

4000.00

September 7

Sales – invoice 401

66.50

4066.50

September 10

Sales – invoice 402

117.00

4183.5

September 15

Sales return – credit note 39

17.50

4166

September 19

Bank –Susan

3920.00

246

September 30

Balance c/f

246

Terms: 2 % discount for settlement within 20 days.

Question number: 109 (4 of 5 Based on Passage) Show Passage

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Short Answer Question▾

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State for what purpose of sending a statement of account to a customer.

Explanation

The main purpose of sending a statement of account to a customer:

  • The statement will provide information about the amount due to the supplier.
  • The customer will be reminded through the statements.

The total record of statement was provided to the Susan in order to show that there is no error have been made by customer or by the supplier with amount payable or receivable by them.

Question number: 110 (5 of 5 Based on Passage) Show Passage

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Short Answer Question▾

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Susan desired to avail the advantage of each month of the discount terms which is offered by the Western Commercial Company.

Explain how Susan ensures about the discount on payment of her credit?

Explanation

She should pay the amount with in twenty one days

The customers have to pay their dues within their credit period in order to enjoy or avail the discount on their payment. The credit period is allowed to the customer for prompt payment of their dues.

Question number: 111

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Short Answer Question▾

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Explain the modifying principles.

Explanation

To make the accounting information useful to various interested parties, the basic assumptions and concepts of accounting principles are modified. These modified principles are as:

  • Cost Benefit Principle
  • Materiality Principle
  • Consistency Principle