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BPP studying Media is proud to be the professional writer for CTH. Our CTH learn publications give you the excellent tailored studying source for the CTH examinations and also are an invaluable resource of reference and knowledge for these making plans a profession within the hospitality and tourism industries.

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Example text

The double entry for the ABC Company would be: Debit Creditors account Credit Sales returns account 39 FINANCE FOR TOURISM AND HOSPITALITY If Dennis Debtor returns £120 of faulty goods. The double entry for the ABC Company would be: Debit Sales returns account £120 Credit Debtors account £120 The entry into Dennis Debtor’s personal account in the sales ledger: Sales (invoice 234) A C T I V I T Y Dennis Debtor £ 520 Sales returns A/c no: SL 51 £ 120 3 5 m i n u t e s Which one of the following would be the correct entry in a personal account to record when a customer's cheque is returned unpaid?

To correct this requires the double entry: 18 1: INTRODUCTION TO FINANCIAL ACCOUNTING ƒ Debit the fixed assets account £2,000 ƒ Credit the bank account £2,000 Bank account £ 11,000 Suspense Fixed assets Bal c/d 11,000 8,900 Bal b/d Bal b/d £ 100 2,000 8,900 11,000 Bank Bank Bal b/d Fixed assets account £ 2,000 Bal b/d Bal c/d 2,000 1,000 £ 1,000 1,000 2,000 Now all the errors have been corrected we can redraft the trial balance. Debit £ 8,900 Bank Capital Purchases Creditors Rent Sales Fixed assets A C T I V I T Y Credit £ 10,000 3,000 2,000 600 1,000 13,500 6 5 1,500 13,500 m i n u t e s Which one of the following statements is not true?

In many instances where an invoice is for the provision of a service then the invoice will be sent out to the customer after the service has been provided. 4 Credit note A credit note is effectively the reverse of an invoice. It is a document issued by the seller to show a reduction in the amount owed by the buyer. The reduction could be due to a variety of reasons such as: (a) (b) (c) Goods were not according to specifications; Goods were damaged during packing or transit; Goods were faulty. A credit note is sometimes printed in red to distinguish it from an invoice.

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CTH Finance for Tourism and Hospitality by BPP Learning Media


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