ACCA F3 MCQ Petty Cash
Simran uses the imprest method of accounting for petty cash. She counted the petty cash and there was
$60.
There were also the following petty cash vouchers:
1. Sundry Purchases $80;
2. Loan to sales manager $80;
3. Purchase of staff drinks $60;
4. Sundry sales receipts $40;
What is Simran’s imprest amount?
| A. | 320 |
| B. | 80 |
| C. | 160 |
| D. | 240 |
| Answer. | D. |
The answer to this question is D.
Examiner's comment:
It was very surprising that this question was not well answered with only 33% of candidates attempting the question correctly. The imprest method of accounting for petty cash means that a business reimburses petty cash back to a fixed imprest amount on a periodic basis. To work back to the original imprest amount, candidates had to take the cash in hand balance and add back expenses and deduct income as follows:
| Balance of petty cash in hand | 60 |
| Sundry purchases | .80 |
| Loan to sales manager | 80 |
| Purchase of staff drinks | 60 |
| Less Sundry Sales receipts | 40 |
| Answer. | 240. |
The most common answer to this question (with 34% of the responses) was A. This option added back all of the items in the list, not recognising that the sundry sales receipts were income and not an expense. This suggests that many candidates did not read the question properly before answering it, and in multiple choice questions, this is a key element of exam technique.
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