Summary: Level 2 Certificate In Bookkeeping ( A1 &a2)

Read the summary and the most important questions on Level 2 Certificate in Bookkeeping ( A1 &A2)

• 3 Subsidiary Books

• 3.1 Subsidiary Books

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• What is the main function of subsidiary books?

  To collate information before recording it in the ledger so as to keep the ledger at manageable size.

• NAME the normal subsidiary books used by a business.

  - The Purchases Day Book
  -The Purchases Returns Book
  - The Sales DAy Book
  - The SAles Returns Book
  - The Wages Book
  -The Jounal
  - The CAsh Book
  -The Petty CAsh Book       

• 3.2 Invoices and VAT

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• What can you understand about INPUT and OUTPUT VAT?

  Input tax is a tax paid by the business in connection with the goods it buys.
  
  Output tax is a tax that business that adds to the price of goods and services it sells.It is ultimately paid by the consumer.  

• 3.3 Credit Notes

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• Give some reasons why credit note is used.

  1. Damaged goods or the type of quality is not correct
  2. The original invoice is too high

• 3.5 The Purchases Day Book

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• What are the invoice details to be entered in the book?

  -invoice number
  -the date when the invoice is received
  -the name of the supplier
  -the folio number (the account number of the supplier)
  -the amount

• What is the posting of the purchases day book look like? 

  Credited to the account of the relevant supplier- the total value of each invoice 
  Debited to the purchases account- the periodoc (usually monthly) total of the purchases.

• 3.7 The Sales Day Book

• How is Sales Day Book different from the PUrchase Day Book?

  It is different from the information in the sales invoices which is collated.
  
  "The amounts of each sale are then posted to the individual accounts of customers and the total amount for sales is posted periodically to the sales account .

• 3.8 The Sales Returns Book

• Write the entries posted in the SAles Returns Book. 

  1) Debiting the monthly total of sales returns to the sales returns account
  2) Crediting the amount each credit note to the individual customer's account.

• Why are some businesses choose to keep entries without using day book?

  -This process has the advantage that individual customer's and supplier's accounts are updated as soon the information is received, rather than periodically, so that if a customer enquires about his account it is possible to give him an up to date balance.
  -This is common where there are a large number of transactions.

• 4 The Cash Book

• 4.1 The Cash Book

• What is a cash book?

  This is a book where cash account and bank account place.
  It is the only book which acts as both a subsidiary book and the part of the ledger, and because of this the entries in it form one half of the double- entry.