IGCSE Accounting Paper-2: Specimen Questions with Answers 28 - 30 of 103

Passage

The following transactions are shown in the books of Mr. Ringon for the month of January 2007.

Jan 1st Received a cheque from Mr. Fatso to whom goods were sold for £20000, allowed him 1%

Jan 2nd Mr. Fatso’s cheque was deposited in bank

Jan 5th Mr. Fatso’s cheque was dishonored (bank charges £100)

Jan 8th Mr. Fatso settled his account by means of a cheque £20250, £150 being interest charged.

Question number: 28 (3 of 5 Based on Passage) Show Passage

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Short Answer Question▾

Write in Short

What are the other types of cash book available, which Mr. Ringon can maintain instead of three columnar cash book?

Explanation

The other types of cash book which are available for Mr. Ringon are as follows:

(i) Single column book: In this type only 1 column for cash is maintained

(ii) Double column book: In this type 2 columns are maintained. One is for cash and the other is for discount

(iii) Three column book: In this 3 columns are present, cash, bank and discount respectively. Mr. Ringon follows this type of cash book.

(iv) Petty cash book: This is to record all petty expenses which are repetitive in nature

Question number: 29 (4 of 5 Based on Passage) Show Passage

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Essay Question▾

Describe in Detail

Why does Mr. Ringon enter the letter C in his cash book, what does it imply?

Explanation

The term C in Mr. Ringon’s books refers to Contra entry. The term contra entry means an entry for which the debit and credit is simultaneously recorded in the three columnar cash book. Examples of such entry are: cash withdrawn or deposited in bank. . Hence such entries are marked with the letter C, to distinguish them from others.

Question number: 30 (5 of 5 Based on Passage) Show Passage

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Essay Question▾

Describe in Detail

Prepare a three columnar cash book, for Mr. Ringon and show how these transactions will be entered.

Explanation

Three columnar cash book in the books of Mr. Ringon during the month of January 2007

Table of Three columnar cash book in the books of Mr. Ringon during the month of January 2007

DATE

PARTICULARS

LF

DISCOUNT

CASH

BANK

DATE

PARTICULARS

LF

DISCOUNT

CASH

BANK

Jan 1st

To Fatso A/c

200

19800

Jan 2nd

By bank A/c

C

19800

Jan 2nd

To Cash A/c

C

19800

jan 5th

By Fatso A/c

200

19900

Jan 8th

To Fatso A/c

20250

Note: £ 19900 include bank charges of £100

£20000 discount@1%=£200