Accounting 0452 · IGCSE · Books of prime entry

Books of prime entry — practice question

Rasheed set up a business on 1 October 2021 and keeps a petty cash book in the business. A monthly imprest of $100$ is replenished on the first day of every month. Rasheed’s petty cash transactions for September 2022 were: September 2 Taxi fare paid $12 September 7 Purchases ledger account of Crystal paid $16 September 13 Postage stamps bought $10 September 18 Purchases ledger account of Kalpa paid $15 September 25 Bus fare paid $5 September 29 Cleaner paid $28
(a)[2]

State two advantages of keeping a petty cash book.

(b)[8]

Complete Rasheed’s petty cash book for September 2022 on the next page. Balance the petty cash book and carry the balance down on 1 October 2022. Make the amount needed to restore the imprest clear.

(c)[2]

Write the entries that would appear in the following accounts in September 2022. You do not need to total or balance the accounts.

(d)[2]

Draw up the Inventory account at 30 September 2022. Balance the account and bring the balance down on 1 October 2022.

(e)[6]

Explain to Rasheed three difficulties with inter-firm comparison.

Worked solution & mark scheme

This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Fewer entries need to be made in the main cash book” …

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