Progress Test question

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Hi everyone

Sorry but I'm being really thick

In my Basic Book Keeping Progress Test I've been asked to give two examples of income (for a business). I have written sales but I can't think of a second! Please help

Thanks

Gem x

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    Hi Gem.

    What about offering a service, bank interest received, etc.

    Income is merely money coming in.

    Scott.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    Thank you Scott!

    Gem x
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    HI GEM

    WHAT ABOUT RENT RECEIVABLE?

    JAMES

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    Even better, thank you!

    Gem x
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    Hi Scotty,

    I am also struggling with my first progress test - HELP PLEASE!!!. The question asks me to show several balances in some on the account in the ledger as debit or credit. Do you think it means each individual account in the main ledger or as they should be shown in bank account? I feel that the question could mean two different things. Oh dear - I am totally confused :?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    Hi Suzy,

    I noticed that Scotty isn't on line but I may be able to help (apologies Scotty for butting in!). Do you mean that the question is asking which accounts can be debits AND credits. If that is the case, the bank can be a debit/credit so can:

    Directors loan accounts (debit if overdrawn, credit if in credit)
    VAT (debit if Customs owe you, credit if you owe them)
    PAYE (debit if they owe you, credit if you owe them)
    Profit and loss on sale of assets (profit = credit, losses = debit)

    Those are the main ones that spring to mind but anybody got any more?

    Kind regards
    Steve
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    Hi Steve, Thanks for reply but must not have made myself clear. I am so confused. The question reads as follows: "On 1 March 2005 the following were balances in some of the accounts in the ledger. Would these be shown as debits or credit balances?" Then goes on the list several accounts ie Capital, Sales, Rent, Drawings etc and their individual amounts. Am I missing the point somewhere? Suzy B :(
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    Capital is money owed by the business to the owner so should be a credit (a liability in the balance sheet)

    Sales should be a credit in the profit and loss (sales are classed as revenue).

    Rent is an expense so should be a debit in the profit and loss.

    Drawings are withdrawals made by the owner for private items so should be a debit.


    Expenses are always debits in the profit and loss account.

    Sales is always a credit in the profit and loss accounts.

    Capital is always a credit in the profit and loss account.

    Fixed assets (net book value i.e. cost less depreciation)and current assets are always debits in the balance sheet.

    Creditors (within and more than one year) are always credits in the balance sheet.

    Share capital is always a credit in the balance sheet (limited cos).

    Hope that helps.

    Kind regards
    Steve
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    I will have to sit and study this some more. Thank again Steve :oops:
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    This might help:

    Debits
    Purchases
    Expenses
    Assets

    Credits

    Revenues
    Liabilities
    Sales


    Note the acronym PEARLS.

    Kind regards
    Steve
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    Hi Steve, That is SO good. Thanks Suzy B :)
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    DEADCLIC is a good one

    Debit
    Expenses
    Assets
    Drawings/Debtors

    Credit
    Liabilities
    Income
    Capital/Creditors

    Hope it helps! Good luck with the questions too

    Gem
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    Hi Gem
    That is really helpful. Thank you

    Suzy :) B
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Progress Test question

    I have just stumbled across this having had real trouble on it in my progress test.

    Just wanted to say thanks to those who posted the memory tips.

    Also wanted to say that it makes me feel a lot better knowing that I am not the only one who is getting confused by this!

    Thanks again,
    Sarah

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