Ch 13 (Topic 1) - Control Accounts

Question 1

A control account is called a “totals account” because it mainly shows what?

A. The total for a group of similar transactions B. Only one customer's transactions C. Only cash transactions D. Only errors found by accountants

Question 2

Tyson makes a credit sale of $500 to Able. What happens to total receivables?

A. They increase by $500 B. They decrease by $500 C. They remain unchanged D. They increase by $250

Question 3

If a business makes credit sales of $6,030 including $1,005 sales tax, what amount is posted to the receivables’ ledger control account?

A. $5,025 B. $1,005 C. $6,030 D. $7,035

Question 4

A customer returns goods worth $200 including sales tax. What is the effect on the receivables’ ledger control account?

A. Debit it by $200 B. Credit it by $200 C. Debit it by $100 D. Leave it unchanged

Question 5

Why are individual customer accounts in the receivables’ ledger described as memorandum accounts?

A. They provide detailed supporting information B. They replace the general ledger completely C. They record only cash sales D. They are used only when errors occur

Question 6

Customers owe Tyson $8,000 at the beginning of the month. During the month, credit sales are $4,000 and customers pay $3,000. Ignoring other transactions, what is closing receivables?

A. $9,000 B. $11,000 C. $7,000 D. $15,000

Question 7

Tyson's customers have individual balances of $1,200, $800, $500 and $300. What total should be compared with the receivables’ ledger control account?

A. $2,500 B. $2,800 C. $3,000 D. $1,200

Question 8

Which transaction would normally be credited in the receivables’ ledger control account?

A. Credit sales B. Sales tax on credit sales C. Cash received from customers D. Opening receivables balance

Question 9

Why does reconciling the receivables’ ledger with the control account help an accountant?

A. It helps identify errors in the records B. It guarantees that no accounting error exists C. It removes the need for individual customer accounts D. It changes credit sales into cash sales

Question 10

Tyson has receivables of $10,000. Customers return goods worth $1,000 and then pay $4,000. What is the remaining receivables balance, assuming there are no other transactions?

A. $5,000 B. $7,000 C. $13,000 D. $6,000

🎉 Your Accountant Score!

💡 Golden Rule:
If customers owe MORE → Debit Receivables Control Account.
If customers owe LESS → Credit Receivables Control Account.