CAT

T1
FREE ONLINE CBE BASED MOCK EXAM

20 Questions
Updated for
Exams in 2010
MINI MOCK EDITION

Prepared by | Hasaan Fazal

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CAT – T1 Recording Financial Transactions | CBE Based Test www.ACCA-LIVE.com

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CAT – T1 Recording Financial Transactions | CBE Based Test www.ACCA-LIVE.com

1
Remittance advice is sent by:

A. Customer to supplier
B. Customer to the banker of supplier
C. Customer to his own banker
D. Customer to his own accounting department

2
Remittance advice must:

A. Specify the invoice number(s) for which payment is made

B. Specify the order number(s) for which payment is made
C. Specify the dispatch note number(s) for which payment is made
D. Specify the GRN number(s) for which payment is made

3
Summer, a customer of Autumn, has returned goods purchased earlier costing 50 to Autumn. Which
document do you think Summer should issue in respect of this return?

A. Debit note
B. Credit note
C. Dispatch note
D. Invoice

The following data relates to Question 4 to 7

Steel and Alloy are doing business with each for four years now. On July 1, 20x9 Steel bought some
goods from Alloy costing $3,000. Alloy has allowed 5% trade discount and has also agreed that if Steel
pay the invoice within one week he will be allowed a further discount of 2.5%.

Alloy is confused about recording this transaction in his books and has approached you.
Assuming the sales tax is 17.5% tell him the amount of:

Q4: Sales tax

Q5: Sales that will be recorded in sales account
Q6: Receivables from steel
Q7: Cash discount
[NOTE: write answers correct up to 2 decimal places.]

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8
Which of the following statement shows the correct flow documents?

i. Order > Dispatch note > invoice > receipt

ii. Tender > Quotation > Order
iii. Order > debit note > invoice
A. i only
B. i and ii only
C. ii and iii only
D. I, ii and iii

9
The account of ICE Ltd is finalizing receivables accounts. During the process he forgot to post the
discount allowed to Mr. Sushi in Sushi’s account. Because of this mistake the closing balance of Mr.
Sushi’s account is overcastted by $50. What will be the amount that will be recorded in the suspense
account to balance the trial balance?

A. 50 debit
B. 50 credit
C. 100 credit
D. 100 debit

10
Which of the following statement(s) is/are TRUE?

i. Purchases are recorded exclusive of sales tax

ii. Receivables are recorded after deducting cash discount
iii. We have tax refund if output tax is greater than input tax

A. iii only
B. i and ii only
C. i only
D. ii and iii only

11
Internal auditor of Sangsung Co is analyzing the correctness of payables for month ended
November. He thinks that one of the best ways of confirming the accuracy of payables is by asking our
creditors regarding such information. Which of the following document will auditor ask the creditors to
send?

A. Debit and credit notes for the month of November

B. Invoices issued in November
C. Statement of account for November
D. Cash receipts raised in November

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CAT – T1 Recording Financial Transactions | CBE Based Test www.ACCA-LIVE.com

12
What is the journal entry to record dishonored cheque?

A. Debit: Profit and loss account Credit: Bank account

B. Debit: Receivable account Credit: Bank account
C. Debit: Dishonor account Credit: Cheque account
D. Debit: None Credit: Bank account

13
Sales account is maintained in:

A. General Journal
B. Receivables Ledger
C. General Ledger
D. Sales ledger

14
Which of the following is NOT a book of prime entry?

A. Cash book
B. Sales day book
C. Pass book
D. General Journal

15
Hallmark plc is in a business of renting cars. In order to park their cars they have acquired a land on
rental basis from Landmark Co. Hallmark pays rent every month. Accountant of Hallmark has suggested
that we should allow Landmark to collect the rental money every month directly from our bank.

Which of the following facility will allow the Landmark Co to collect money directly from the bank?

A. Bank Giro Credit

B. Direct Debit
C. Standing order
D. Direct deposit

16
Mr. Salahuddin Ayyubi has received a trade discount from one of his suppliers. How he should record it?

A. Credit in cash book

B. Debit in payables ledger
C. Credit in profit and loss account
D. None of the above

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CAT – T1 Recording Financial Transactions | CBE Based Test www.ACCA-LIVE.com

17

This part is know as:

A. Deposit slip
B. Pay-in slip
C. Counterfoil
D. Cheque

18
Drawee and payee of cheque can be two different persons.

 True
 False

19
Errors are corrected via:

A. General Journal
B. General ledger
C. Trial Balance
D. Suspense account

20
One of the benefits of keeping petty cash book is:

A. Petty expenses will be kept separate and will not be added in total expenses
B. No accounting entries regarding petty cash payment will be recorded in general ledger
C. Lesser number of entries in general ledger
D. All of the above

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