Errors Committed in Recording Transactions

Q.

What are the different types of reconciliation?

Q.

What Is the Full Form Of B.R.S.?

Q. Rs.5, 000 deposited in the bank was entered twice in the cash book. To adjust the same, an amount of shall be from the balance as per cash book

1. Rs.5, 000
2. Rs.10, 000
3. added
4. deducted

Q.

What Are the Two Main Components of Balance of Payment Account?

Q.

If cash book is the starting point, then wrong credit given by a bank will be:

1. Added in cash book balance

2. Deducted from cash book balance

3. Added to pass book balance

4. Added to cash book overdraft

Q. On 1st January, 2018, Mr. X sold goods to Mr. Y for ₹ 4, 500 on credit and drew 3 bills on him first bill for ₹ 1, 000 for 1 month, second bill for ₹ 1, 500 for 2 months and third bill for ₹ 2, 000 for 3 months. Mr. Y accepted and returned all the bills to Mr. X.
The first bill was retained by Mr. X till the date of maturity. Second bill was endorsed to his creditor Mr. Z on 3rd January, 2018 and third bill was sent to bank for collection on 4th January, 2017. On maturity all the bills were dishonoured and noting charges amount to ₹ 10, ₹ 15 and ₹ 20 respectively.
Give the Journal entries in the books of X, Y and Z.

Q.

The bank charges of Rs 100 were recorded twice in cash book. What will be the impact in BRS, if it starts with overdraft balance in pass book.

1. Overdraft balance will increase by Rs 200

2. Overdraft balance will increase by Rs 100

3. Overdraft balance will decrease by Rs 1000

4. Overdraft balance will decrease by Rs 100

Q.

When favourable balance as per cash book is the starting point, wrong debit by the bank to the firm will be:

1. Subtracted

2. Added

3. None

4. Both

Q.

A company was entered in hire purchase agreement and had to pay Rs 1, 000 per month. Three payments were made via bank account but no entry was found in cash book. Identify the correct adjustment in cash book.

1. Rs 2, 000 will be deducted in cash book balance

2. Rs 1, 000 will be added in cash book balance

3. Rs 3, 000 will be added in cash book balance

4. Rs 3, 000 will be deducted in cash book balance

Q.

Rs 5, 000 deposited in bank account was entered twice in the cash book. Identify the correct adjustment in cash book.

1. Rs 5, 000 shall be credited in cash book

2. Rs 5, 000 shall be debited in cash book

3. Rs 10, 000 shall be credited in cash book

4. Rs 10, 000 shall be debited in cash book

Q.

Which of the following types of errors are not detected during bank reconciliation?

1. Cash embezzlement by the cashier

2. Cheque deposited but not credited by bank

3. Casting mistakes in bank column of cash book

4. Interest or commission charged by the bank but not accounted for in cash book

Q.

A cheque of Rs 15, 000 was received from a customer Mr. Ram & it was sent for clearance to bank on the same day. Next day, Mr. Ram informed us that the amount has been deducted from his account, so the entry to this regard was made in the books. But later on, it was discovered that the amount has not been credited in our account but credited to some one else's account due to a mistake by the bank. It was credited to our account in the next month. How should this be treated in the bank reconciliation of both the months if starting point is cash book balance?

1. Rs 15, 000 shall be added in both the months

2. Rs 15, 000 shall be subtracted in 1st month & added in next month

3. Rs 15, 000 shall be subtracted in both the months

4. Rs 15, 000 shall be subtracted in 2nd month & added in first month

Q. A cheque of Rs.5, 000 was issued to the supplier was recorded as Rs.500 in the cash book. Due to this error, the balance as per cash book will be by .

1. overstated
2. understated
3. Rs.4, 500
4. Rs.5, 500

Q.

Which of the following is not an example of Timing Difference?

1. Recording a transaction twice in cash book

2. Cheques issued but not yet presented for payment

3. Cheques paid into the bank but not yet collected

4. Direct debits made by the bank on behalf of the customer

Q.

A cheque of Rs 5, 000 was issued to the supplier but it was recorded as Rs 500 in the bank column of the cash book. Due to this error the cash book will ___.

1. Overstate the balance of bank by Rs 4, 500

2. Understate the balance of bank by Rs 4, 500

3. Not be affected

4. None of the above

Q.

When overdraft as per Cash Book is the starting point, Bank charges of Rs 300 recorded twice in the pass book will be:

1. Added by Rs 300

2. Deducted by Rs 300

3. Deducted by Rs 600

4. Added by Rs 600

Q.

The typing speed is measured in

Q.

It is not a new car. However, it is reliable.

Q.

State whether the following statements are TRUE or FALSE :

1. Total of payments side can be greater than total of receipts side in case of bank column.
2. Purchase of asset or stationery on credit is recorded in purchase book.
3. When goods are returned by buyer to seller, buyer sends a debit note.
4. Cheque received and deposited into bank on the same day is a contra entry.
5. Simple petty cash book is not very popular.
6. Interest on overdraft charged by bank is recorded in the cash column.
7. It is not necessary to record dishonor of cheques in the cash book.
8. Cheque book facility is available for fixed deposit account.
9. Businessman generally operates savings bank account.
10. A cash book is both a journal as well as ledger.
11. Cash book is a book of original entry.
12. Cash discount allowed is recorded on the debit side of cash book
13. Credit transactions are never recorded in cash book.
14. Endorsed cheques are always recorded on the payment side in the bank column.
15. A person who endorses the cheque is known as endorser.

Q.

Briefly explain the set of SQL statements to produce the receipts side of a cash book for Model- I.

Q.

The error of undercasting of bank pass book is not relevant at the time of preparing the bank reconciliation.

1. True

2. Partly True

3. None

4. False

Q.

Trial balance of Sagar did not agree. It showed an excess credit Rs 7, 550. Sagar put the difference to suspense account. He located the following errors-

1) Sales return book was overcast by Rs 1, 200.
2) Purchases book was undercast by Rs 750.
3) Goods returned to Mahesh Rs 1000 were recorded through sales book.
4) Credit purchase from Mahadev Rs 6, 000 were recorded through sales book.
5) Credit purchase from Damodhar Rs 4, 000 were recorded through sales book. However, Damodhar’s account was correctly credited.
6) Salary paid Rs 3, 500 was debited to employee’s personal account.

Q.

Rectify the following errors-

1) Goods returned to Mr Pathak as they were defective Rs 280 were not recorded in the books.
2) Commission received Rs 625 was recorded in the Journal proper but not posted at all.
3) Purchased Machinery from Hindustan Machinery Ltd. Rs 9, 900 on credit was omitted from the books of accounts.
4) Additional capital Rs 20, 000 introduced by proprietor in to the business was recorded in the cash book but was not posted to the capital account in the ledger.
5) Cash received from the Patel Rs 3, 300 though recorded in cash book was not posted to his personal account in the ledger.
6) Goods sold to Kishor Rs 6, 565 on credit was not posted to his personal account.

Q.

What is petty cash reconciliation?

Q. Answer in one Sentence only.

What is the balance of Cash A/c?

Q.

Give on Word/Term or phrase which can substitute each of the following statements.

1) Statement showing the causes of disagreement between the balance of Cash Book and Pass Book
2) The account on which overdraft facility is allowed by Bank.
3) Excess of total of debit side over total of credit side of Cash Book Bank column.
4) An unfavorable balance shown by the Pass Book
5) A copy of customer’s account issued by the Bank
6) Booklet or a Statement which is used to record the banking transactions.
7) Credit balance of Bank Column of the Cash Book
8) Refusal by Bank to make the payment of cheque

Q. Find out the error in the following sentence, if any. If there is no error, your answer is 'E'.
The needy man (A) was approched to the money lender (B) and requested him to (C) lend him some money. (D) No Error. (E)

1. A
2. B
3. C
4. E
5. D

Q.

If a, b, c, d are positive real numbers such that a + b + c + d =2, then M=(a +b) (c + d) satisfies the relation

(a) 0 < M < 1 (b) 1 < M < 2 (c) 2 < M < 3 (d) 3 < M < 4

Q. Solve this:
Q.8. Rahuls Trial Balance as on ${31}^{st}$ March, 2017 has the following information:

Head of Accounts	Debit	Credit
Sundry Debtors Bad Debts	1, 00, 000 2, 000

Additional Information:
Write off Rs. 2, 000 as Bad Debts.
Show relevant extracts from the Profit and Loss Account and Balance Sheet.