Essential Book Keeping - Qp18

8 Questions | Total Attempts: 30

SettingsSettingsSettings
Please wait...
Essential Book Keeping - Qp18

Questions and Answers
  • 1. 
    A ‘debtor’ is someone you owe money to.
    • A. 

      True

    • B. 

      False

  • 2. 
    Credit is a secured, interest-free loan to customers.
    • A. 

      True

    • B. 

      False

  • 3. 
    The following steps are required to collect cash from a credit sale: (Select five)
    • A. 

      Raise an invoice and delivery receipt

    • B. 

      Record the customer’s debt in your books

    • C. 

      Send credit notes (for returned goods) when required

    • D. 

      Keep a list of good payers

    • E. 

      Send statements (which are reminders to pay the invoice)

    • F. 

      Send reminder letters to slow paying customers

    • G. 

      Telex debtors asking them to pay you

    • H. 

      Record receipts from customers in your books. Pay the receipts into your bank.

  • 4. 
    The normal credit period offered to customers is ______.
    • A. 

      30 days

    • B. 

      60 days

    • C. 

      90 days

    • D. 

      120 days

  • 5. 
    A debt becomes ‘bad’ when all reasonable means of collecting that debt are thwarted.
    • A. 

      True

    • B. 

      False

  • 6. 
    Businesses which have been operating for a number of years tend to build up ‘reserves’ out of investments.
    • A. 

      True

    • B. 

      False

  • 7. 
    A 'retrospective discount’ is an agreed discount amount with the customer, but the customer has to pay the invoice in full.
    • A. 

      True

    • B. 

      False

  • 8. 
    It can be dangerous to extend large amounts of credit to a single customer regardless if you are sure that customer is credit worthy.
    • A. 

      True

    • B. 

      False

Back to Top Back to top