A business makes a cash sale to a customer for £1000 which two accounts are affected?

Unlock all questions

This demo includes only 20 questions. Upgrade to access hundreds of questions, flashcards, exam simulations, and disable ads.

Full question bankExam simulationsFlashcards
From $24.99Unlock all

Study for the AAT Level 2 Introduction to Bookkeeping Test. Use flashcards and multiple choice questions with hints and explanations. Prepare effectively for your exam!

Multiple Choice

A business makes a cash sale to a customer for £1000 which two accounts are affected?

Explanation:
When you make a cash sale, you receive money and you also record income from the sale. This means the cash asset increases and the revenue (sales) increases as well. In double-entry terms you would Debit Cash £1000 and Credit Sales £1000. The other options don’t fit because a sale does not involve Purchases, and in this simple view the act of selling does not automatically change Inventory—the inventory change would be handled in a separate entry to reflect cost of goods sold. So the two accounts affected by the sale itself are Cash and Sales.

When you make a cash sale, you receive money and you also record income from the sale. This means the cash asset increases and the revenue (sales) increases as well. In double-entry terms you would Debit Cash £1000 and Credit Sales £1000. The other options don’t fit because a sale does not involve Purchases, and in this simple view the act of selling does not automatically change Inventory—the inventory change would be handled in a separate entry to reflect cost of goods sold. So the two accounts affected by the sale itself are Cash and Sales.

More Multiple Choice Questions
Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy