AAT Basic Accounting 2 Assignment 1

1. A regular and variable BACS payments, set up by the organisation receiving the payments is called a _______ _______

A regular and variable BACS payment set up by the organization receiving the payments is called a direct debit. A direct debit allows the organization to collect payments directly from the customer's bank account, typically on a recurring basis. This method provides convenience for both the organization and the customer, as it eliminates the need for manual payments and ensures timely and accurate transactions.

Explanation

A regular and variable BACS payment set up by the organization receiving the payments is called a direct debit. A direct debit allows the organization to collect payments directly from the customer's bank account, typically on a recurring basis. This method provides convenience for both the organization and the customer, as it eliminates the need for manual payments and ensures timely and accurate transactions.

Submit

3. A cheque written out by a bank – as good as cash – used for high value purchases is called a Bank Draft

True

False

A bank draft is a type of cheque issued by a bank, which is considered as good as cash. It is commonly used for high-value purchases, as it guarantees payment to the recipient. Therefore, the statement "A cheque written out by a bank – as good as cash – used for high-value purchases is called a Bank Draft" is true.

Explanation

A bank draft is a type of cheque issued by a bank, which is considered as good as cash. It is commonly used for high-value purchases, as it guarantees payment to the recipient. Therefore, the statement "A cheque written out by a bank – as good as cash – used for high-value purchases is called a Bank Draft" is true.

4. A cheque is returned to the business which has paid it in marked 'Refer to Drawer'. This means that the issuer of the cheque does not have sufficient funds in the account to cover the cheque.

True

False

The explanation for the given correct answer is that when a cheque is marked 'Refer to Drawer', it indicates that the issuer of the cheque does not have enough funds in their account to cover the payment. This means that the cheque cannot be processed and will be returned to the business that received it. Therefore, the statement is true.

Explanation

The explanation for the given correct answer is that when a cheque is marked 'Refer to Drawer', it indicates that the issuer of the cheque does not have enough funds in their account to cover the payment. This means that the cheque cannot be processed and will be returned to the business that received it. Therefore, the statement is true.

5. A high value, same day, payments sent through the banks' computer systems is called a CHIPS payment

True

False

CHAPS payment

Explanation

CHAPS payment

6. Match the 'key terms' on banking to the relevant definition.

Current Account

Deposit Account

An overdraft

Business loan

Commercial mortgage

Submit

7. A paper-based direct payment through the banking system with a three day clearance cycle is called a bank giro credit.

True

False

A paper-based direct payment through the banking system with a three day clearance cycle is called a bank giro credit. This means that when a payment is made using this method, it is processed through the banking system and takes three days to clear. The term "bank giro credit" specifically refers to this type of payment method, indicating that the statement is true.

Explanation

A paper-based direct payment through the banking system with a three day clearance cycle is called a bank giro credit. This means that when a payment is made using this method, it is processed through the banking system and takes three days to clear. The term "bank giro credit" specifically refers to this type of payment method, indicating that the statement is true.

8. What do the letters BACS stand for : ______________ _____________________ ___________________ _____________________

The letters BACS stand for bankers automated clearing services. BACS is a system used in the United Kingdom for electronic funds transfer and direct debit payments. It allows for the efficient and secure transfer of funds between bank accounts, automating the clearing process. This system is widely used by individuals, businesses, and organizations for various financial transactions.

Explanation

The letters BACS stand for bankers automated clearing services. BACS is a system used in the United Kingdom for electronic funds transfer and direct debit payments. It allows for the efficient and secure transfer of funds between bank accounts, automating the clearing process. This system is widely used by individuals, businesses, and organizations for various financial transactions.

Submit

9. Match the 'key terms' on banking to the relevant definition.

Cheque

Debit Card

Credit Card

Prepayment Card

Submit

10. Match the key term with the relevant definition.

Remittance advice

Cheque requisition form

Bank giro credit

AUDDIS

CHAPS

Submit

11. As an accounts assistant at N Limited you have to process the documents for a wide variety of payments to employees, suppliers and for other business expenses such as one-off purchases, travel costs and bills. Match the method of payment to the appropriate expense.

Standing Order

Cheque

BACS

Bank Draft

Credit Card

CHAPS payment

Submit