SSC CGL Finance – Self-Balancing Ledgers – Level 2 · Exam Level · Paper III Sprint | Online Quiz

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SSC CGL Finance – Self-Balancing Ledgers – Level 2 · Exam Level · Paper III Sprint – 14 questions, subject: Finance & Economics (Tier II Paper III). Every question has the correct answer with a one-line explanation; tap "Show Answer". Free practice for TNPSC, UPSC, SSC, Bank and RRB exams – Shanmugam IAS Academy, Coimbatore.

Opening creditors ₹ 70,000; credit purchases ₹ 1,30,000; cash purchases ₹ 25,000; purchase returns ₹ 4,000; cash paid to creditors ₹ 1,10,000; discount received ₹ 2,000; bills payable accepted ₹ 15,000. Closing creditors:

Correct Answer: A [₹ 69,000]

Explanation:

Ignore cash purchases: 70,000 + 1,30,000 − 4,000 − 1,10,000 − 2,000 − 15,000 = 69,000.

Statement-based
I. In a self-balancing system every ledger can be balanced independently.
II. In a sectional balancing system the debtors' ledger contains a General Ledger Adjustment Account.
Which is/are correct?

Correct Answer: B [Only I]

Explanation:

Sectional balancing has no adjustment account in personal ledgers.

Bad debts recovered ₹ 2,000 (written off two years ago) will be:

Correct Answer: C [ignored in the Debtors' Ledger Adjustment Account]

Explanation:

Usual entry Cash Dr, To Bad Debts Recovered – no customer's account is touched.

A customer's debit balance of ₹ 3,000 is set off against his credit balance in the creditors' ledger. In the general ledger the entry is:

Correct Answer: D [Creditors' Ledger Adjustment A/c Dr, To Debtors' Ledger Adjustment A/c]

Explanation:

Both controls fall by 3,000 – Set-off Twin.

Debtors: opening ₹ 75,000, closing ₹ 90,000; cash received ₹ 2,10,000; discount allowed ₹ 5,000; returns inward ₹ 3,000; bill receivable dishonoured ₹ 2,000. Credit sales were:

Correct Answer: A [₹ 2,31,000]

Explanation:

90,000 − 75,000 + 2,18,000 − 2,000 = 2,31,000.

Match the followingMatch the item with its side in the Debtors' Ledger Adjustment A/c (general ledger):
P. Interest charged on overdue account Q. Bills receivable received R. Cash sales
1. Debit 2. Credit 3. Not entered

Correct Answer: C [P-1, Q-2, R-3]

Explanation:

Interest raises dues; B/R reduces them; cash sales stay out.

Assertion–Reason
A: Bills receivable discounted with the bank are not entered in the Debtors' Ledger Adjustment Account.
R: The customer's account was already credited when the bill was received.

Correct Answer: B [Both A and R are true and R explains A]

Explanation:

Discounting is between the firm and its bank.

The balance of the General Ledger Adjustment Account in the creditors' ledger is normally:

Correct Answer: D [a debit balance equal to total creditors]

Explanation:

Mirror of the credit-balance Creditors' control.

Which book provides the total of 'returns inward' for the Debtors' control account?

Correct Answer: C [Sales returns book]

Explanation:

Returns inward = sales returns.

10.

Arrange in orderArrange the steps in preparing a self-balancing debtors' ledger at the month-end: (1) post monthly totals to the adjustment accounts (2) total the subsidiary books (3) balance the personal accounts (4) agree the list of balances with the adjustment account

Correct Answer: A [2, 1, 3, 4]

Explanation:

Totals → post → balance → agree.

11.

Opening creditors ₹ 30,000; credit purchases ₹ 50,000; paid ₹ 40,000; bills payable accepted ₹ 5,000; one of our acceptances of ₹ 2,000 was dishonoured. Closing creditors:

Correct Answer: B [₹ 37,000]

Explanation:

Dishonour revives the debt: 30,000 + 50,000 + 2,000 − 40,000 − 5,000 = 37,000.

12.

Spot My Mistake“Provision for doubtful debts ₹ 2,500 was credited to the Debtors' Ledger Adjustment Account.” Correct treatment:

Correct Answer: D [It is not entered in the control account]

Explanation:

A provision does not alter any customer's balance.

13.

Opening debtors ₹ 40,000; credit sales ₹ 70,000; cheques received from debtors ₹ 52,000, of which one cheque of ₹ 6,000 was dishonoured. Closing debtors:

Correct Answer: C [₹ 64,000]

Explanation:

40,000 + 70,000 − 52,000 + 6,000 (dishonour) = 64,000.

14.

Which statement about a credit balance on a customer's account in the debtors' ledger is correct?

Correct Answer: A [It is shown separately on the debit side of the Debtors' control as a closing balance (balance c/d)]

Explanation:

A balance c/d sits on the side opposite to its nature: closing credit balances are carried down on the debit side, separately from the debit balances.

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