These eight questions follow the lessons in source documents, from naming a document to recording a full transaction set. Write each answer on paper first, then open the answer.
Questions
1. A seller accepts goods returned by a customer who bought on credit. Which source document does the seller issue?
Answer
A credit note. It reduces the amount the customer owes. An invoice creates a debt and a receipt records money received, so neither fits a return.
2. An invoice lists 60 units at RM12.50 each, less 20% trade discount. Find the invoice total.
Answer
Before discount: 60 × RM12.50 = RM750.00. Discount: 20% of RM750.00 = RM150.00. Total: RM750.00 − RM150.00 = RM600.00.
3. The customer in question 2 returns 6 units. Find the credit note total and the amount still owed.
Answer
6 × RM12.50 = RM75.00, less 20% (RM15.00) = RM60.00. Still owed: RM600.00 − RM60.00 = RM540.00. Crediting RM75.00 is the usual wrong turn.
4. The customer pays RM300.00 towards the balance in question 3. What receipt is issued and what remains owed?
Answer
A receipt for RM300.00. Remaining balance: RM540.00 − RM300.00 = RM240.00.
5. An invoice shows 15 items at RM8.40 each, with a total of RM136.00. Find the error.
Answer
15 × RM8.40 = RM126.00, so the total should be RM126.00. The document overstates the amount by RM10.00, which looks like a digit slip, 126 written as 136. Query it before recording.
6. An invoice is dated 28 February but recorded in the March purchases. Which month’s figures are wrong, and in which direction?
Answer
February purchases are understated and March purchases are overstated by the same amount. The transaction belongs to the month in which it happened, which is the date on the document.
7. Recall question 3. Write the credit note entry in the seller’s books and in the buyer’s books.
Answer
Seller: Debit Sales returns RM60.00, Credit Debtors RM60.00.
Buyer: Debit Creditors RM60.00, Credit Purchases returns RM60.00.
Each side records what happened to its own account.
8. Tiara Hardware issues Invoice 1503 dated 10 April for 12 pails at RM18.00 each, terms 30 days. State the amount, the due date and the buyer’s entry.
Answer
Amount: 12 × RM18.00 = RM216.00. Due date: 30 days after 10 April is 10 May. Buyer’s entry: Debit Purchases RM216.00, Credit Creditors (Tiara Hardware) RM216.00.
If you got these wrong
- Questions 1 to 4, 7: revisit reading invoices, credit notes and receipts.
- Questions 5, 6: read about avoiding document-date and amount errors.
- Questions 7, 8: review connecting documents with transaction effects.
For timed practice, use the timed practice session builder, and keep a mistake log. A teacher can go through your working in online one-to-one Accounting tuition.