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Objective Assessment on Control Accounts

by Ken Delaney-Moore

This assessment covers the following material:

The principle of control accounts
The format of debtors ledger (sales ledger) control accounts
The format of creditors ledger (purchases ledger) control accounts
Sources of information for compiling control accounts
Reconciling control account totals

If you are unsure about attempting the assessment, it may be advisable to have a look at the work-sheet first. When you are done, please fill-in the on-line evaluation form in order for us to monitor the quality of the materials we provide for you. Tell us what we're doing right and wrong. It takes very little time, and your opinions are valued - thank you.

Each question comes with three buttons:

'HINT' - provides help if you need it
'MARK' - will tell you your mark for that question and (if you were incorrect in any way, it may give advice - be careful to read this advice).
'EXPLAIN' - should provide you with a full explanation of the answer, but this button is only active after you have attempted the question (twice, in the case of the first ten questions).

THE ASSESSMENT STARTS BELOW. NO-ONE EXCEPT YOU WILL SEE YOUR SCORE - 'BIZED' DOES NOT KEEP A RECORD.

Note that in some of these questions there is only one correct answer, but for other questions there may be more than one answer. You will be told this information in advance, so read carefully:

For questions 1 to 10 there is only ONE correct answer. Each correct answer is worth two marks. You are allowed TWO ATTEMPTS at each of the first ten questions (i.e. you are allowed a second choice if your first choice is incorrect).

Q1. A purchases ledger control account is also known as:
(Select one answer)

(a) * A total debtors account
(b) * A creditors suspense account
(c) * A debtors suspense account
(d) * A total creditors account

           

Q2. Which of the following is NOT a claimed benefit of using control accounts?
(Select one answer)

(a) * Errors can be located to individual ledgers (such as debtors ledger, creditors ledger)
(b) * The trial balance can be made a lot shorter - i.e. no need to list all the individual debtors and creditors balances, simply use the control account balances.
(c) * Control accounts provide a quick figure for total debtors (or total creditors) - much quicker than totalling all the individual accounts.
(d) * Correct use of a control account should ensure that the trial balance totals agree.

           



Q3. Which of the following transactions should appear on the credit side of a purchases ledger control account?
(Select one answer)

(a) * Purchases returns
(b) * Discounts received
(c) * Credit purchases
(d) * Payments made to suppliers

           

Did you read the explanation provided by the 'explain' 'button for the previous question?

Q4. Which of the following items can be found in both a sales ledger control account and a purchases ledger control account?
(Select one answer)

(a) * Discounts allowed
(b) * 'Contra'-entries
(c) * Discounts received
(d) * Returns in

           

Don't forget that the MARK button often provides useful feedback as well - be sure to read this feedback!

Q5. At the beginning of April the total debtors figure for A.Firm Ltd was £30,100. During April the following transactions took place: Credit sales £6,500. Sales returns £600. Receipts from debtors £5,800, including a cheque for £400 which was subsequently dishonoured ('bounced'). Discounts allowed £200. What is the total debtors figure at the end of April?
(Select one answer)

(a) * £30,400
(b) * £30,000
(c) * £29,600
(d) * £30,800

           

Q6. At the beginning of April the total creditors figure for B. Reeze Ltd. was £18.500. During April the following transactions took place: Credit purchases £4,200. 'Contra - entries' amounts offset against debtors' ledger) £300. Payments to creditors £1600. Discounts received £200. What is the 'total creditors' figure at the end of April?
(Select one answer)

(a) * £21,200
(b) * £20,600
(c) * £21,000
(d) * £23,800

           

Did you read the explanation provided by the 'explain' 'button for the previous question?

Q7. Deeley & Sons' sales ledger control account showed the following information for the month of June: Opening debtors £42,500. Returns in £1,200. Receipts from debtors £6,800. Discounts allowed £300. Closing debtors £40,900. What was the total credit sales made to debtors (assuming no other transactions)?
(Select one answer)

(a) * £5,900
(b) * £6,100
(c) * £6,700
(d) * £4,300

           

Q8. Which one of the following will provide information for the sales ledger and purchases ledger control accounts?
(Select one answer)

(a) * The trial balance
(b) * The sales and purchases accounts
(c) * The books of original entry
(d) * The source documents

           

Q9. Which one of the following will provide information for the sales ledger control account?
(Select one answer)

(a) * The 'returns out' day book
(b) * The discounts received column in the cash book
(c) * The total bad debts written-off.
(d) * The purchases day book.

           

Don't forget to fully utilise the 'hint', 'mark' and 'explain' buttons - read carefully what it says.

Q10. When the purchases ledger control account of Markham Ltd was drawn-up, the balance was £17,610 (credit). It was later discovered that: 1. A page in the purchases day book was undercast by £890 (if you don't know what 'undercast' means, try the 'hint' button). 2. A supplier had given a discount of £130 to Markham, but this had not been entered in the cash book. What should the correct balance be on the control account?
(Select one answer)

(a) * £16,590 cr.
(b) * £18,370 cr.
(c) * £18,630 cr.
(d) * £16,850 cr.

           

For the last five questions there MAY BE MORE THAN ONE correct answer (but not necessarily so!). You are allowed only ONE ATTEMPT at these questions. Each question carries a total of four marks.

On questions 11 to 15, the 'MARK' button will only provide you with an explanation for the options that you selected. The 'EXPLAIN' button will give a more general explanation.

Q11. Which of the following provides a check on the accuracy of the balances in suppliers' accounts?
(Select one or more answers)

(a) * Purchases account
(b) * Purchases Ledger Control Account
(c) * Purchases returns account
(d) * Sales ledger control account

           

Q12. Which of the following would be used in compiling a purchases ledger control account?
(Select one or more answers)

(a) * The journal
(b) * The returns out day book.
(c) * The discounts received column in the cash book
(d) * The individual creditors accounts

           

Don't forget to fully utilise the 'hint', 'mark' and 'explain' buttons - read carefully what it says.

Q13. When the sales ledger control account of Tangmere Ltd was drawn-up, the balance was £33,900 (debit). It was later discovered that:
1. A page in the sales returns day book was undercast by £550.
2. A debt owed by Mason, value £240, had been written-off. Unfortunately the journal entry for this was for £420.
Which of the following statements are definitely true?
(Select one or more answers)

(a) * The correct balance on the control account should be £33,530
(b) * Bad debts written-off are overcast by £180
(c) * Mason's account will be in credit.
(d) * The correct balance on the control account should be £33,170

           

Q14. The sales ledger control account of Bacon Ltd. showed a 'debit' balance b/d on 1st May of £43,200. On the same date the purchases ledger control account showed a 'credit' balance b/d of £29,100. However, these balances did not take account of the following transaction:
On 27th April an amount of £1,300 owing by Gammon Ltd. was part-offset against an amount of £800 owing to the same company.
Which of the following statements is / are true?
(Select one or more answers)

(a) * The revised sales ledger control account balance should be £42,400
(b) * The revised sales ledger control account balance should be £41,900
(c) * The revised purchases ledger control account balance should be £28,300
(d) * The revised purchases ledger control account balance should be £27,800

           

Q15. Kensington Ltd. had a purchases ledger control account balance of £55,300. However when the individual creditors account balances were totalled the figure came to £56,500. Which of the following statements is / are true?

(Select one or more answers)

(a) * There is at least one error in one of the creditors' accounts.
(b) * There is at least one error in the control account
(c) * There is at least one error either in one of the creditors' accounts or in the control account
(d) * A journal entry will be necessary to correct the error.

           

That's the end of the assessment questions. You can have your total mark calculated by clicking on the button below:

Now please fill-in the on-line evaluation form in order for us to monitor the quality of the materials we provide for you. It takes very little time, and your opinions are valued - thank you.