Inventory valuation and bank reconciliation quiz: O-Level Principles of Accounts (SEAB/Cambridge 7087) quiz

At the lower of cost and net realisable value

Always at cost

Always at selling price

At the higher of cost and net realisable value

The going concern concept

The prudence concept

The matching concept

The entity concept

$5{,}000$

$9{,}200$

$4{,}200$

$800$

The total of trade receivables

The cost of sales

The bank balance

The total of the individual supplier balances in the purchases ledger (trade payables)

To act as an arithmetic check on the personal ledgers and help locate errors

To replace the personal accounts entirely

To value inventory

To record cash discounts only

To remove unpresented cheques

To record items the business learns of only from the bank statement, such as bank charges and direct debits

To value the inventory

To increase the profit

A cheque the business has received but not banked

A cheque that has bounced

A cheque the business has written and recorded, but which has not yet been deducted by the bank

A deposit not yet credited by the bank

$6{,}120$

$5{,}880$

$6{,}060$

$5{,}940$

It is added to the bank statement balance

It is subtracted from the bank statement balance

It is ignored

It is entered in the cash book first

Added to the cash book as a receipt

Entered in the cash book as a deduction, because the money was not actually received

Treated as an unpresented cheque in the reconciliation

Recorded as inventory

Profit is understated

Profit is unaffected

Profit is overstated, because closing inventory reduces the cost of sales

Only the bank balance changes

$3{,}500$

$3{,}300$

$3{,}900$

$3{,}100$