ACCA Applied Knowledge (BT, MA, FA) · Financial Accounting (FA)

Receivables, provisions and reconciliations

8 practice questions, each with the answer and an explanation.

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Random questions from this topic, one at a time. You see the answer and the explanation straight after each one.

All 8 questions

  1. At the year end trade receivables are £85,000. A debt of £3,000 is to be written off as irrecoverable. The allowance for receivables is to be 5% of the remaining receivables. The opening allowance was…
  2. Which of the following is the correct entry when a debt previously written off as irrecoverable is unexpectedly paid in full by the customer?
  3. Under IAS 37, when should a provision be recognised?
  4. A company is being sued. Its lawyers advise that the claim will probably fail, though there is a possibility of an outflow of £50,000. How should this be treated under IAS 37?
  5. The cash book of a business shows a bank balance of £3,250 debit. The bank statement shows a different balance. Comparison reveals: unpresented cheques £1,400; outstanding lodgements £2,100; bank char…
  6. A business's cash book shows an overdraft (credit balance) of £740. On comparison with the bank statement, it is found that a cheque received for £260 was dishonoured and not recorded in the cash book…
  7. The payables ledger account for a supplier shows a balance of £4,860 owed. The supplier's statement shows £6,080. The difference is explained by an invoice of £900 on the statement that has not yet be…
  8. A company has a warranty provision of £18,000 at the start of the year. During the year it paid warranty claims of £11,500 and these were charged against the provision. At the year end it estimates th…

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