AAT Qualification Test Prep Exam Questions & Answers 2026 (11–20)

Question 1

A VAT-registered business has been informed that a customer who owes £600 (including VAT at 20%) has been declared bankrupt. No payment will be received. Which debit entries are required to write off this debt?

TheoryPractice · Accepted Answer

Irrecoverable Debts £500, VAT Control £100. Split gross debt (£600) into net and VAT.
Net: $$600 	imes \frac{100}{120} = £500$$ (Dr Irrecoverable Debts).
VAT: $$600 	imes \frac{20}{120} = £100$$ (Dr VAT Control).

Question 2

Calculate the total VAT to be credited to the VAT Control Account based on the sales day book extract below (standard VAT rate is 20%). Invoice Ref Amount Type Value INV001 Net Value £4,000 INV002 Gross Value £2,400 INV003 VAT Only £300

TheoryPractice · Accepted Answer

£1,500. INV001 (Net): $$4,000 	imes 20\% = 800$$
INV002 (Gross): $$2,400 	imes \frac{20}{120} = 400$$
INV003 (VAT): 300
Total: $$800 + 400 + 300 = £1,500$$.

Question 3

A trial balance shows total credits exceed total debits by £90. An investigation reveals a sales return of £480 was correctly entered in the customer account but posted to the Sales Returns account as £390. Which journal corrects this?

TheoryPractice · Accepted Answer

Dr Sales Returns £90, Cr Suspense £90. The error is a debit shortfall of £90 (£480 - £390). Correct by debiting Sales Returns £90 to reach the correct total and crediting Suspense £90.

Question 4

A business paid an annual insurance premium of £9,000 covering the period 1 April 20X1 to 31 March 20X2. The financial year ends on 31 December 20X1. Which journal entry correctly records the prepayment?

TheoryPractice · Accepted Answer

Dr Prepayments £2,250, Cr Insurance £2,250. Prepayment covers 3 months (Jan-Mar). Calculation: £9,000 × 3/12 = £2,250. Credit Insurance to reduce the expense and debit Prepayments to recognise the asset.

Question 5

Using the transaction totals below, calculate the closing balance of the Purchase Ledger Control Account. Transaction Type Amount Opening Balance (Credit) £10,000 Credit Purchases (Net) £20,000 VAT on Credit Purchases £4,000 Payments to Suppliers £18,000 Discounts Received £500 Contra with Sales Ledger £1,000

TheoryPractice · Accepted Answer

£14,500. Calculation: £10,000 (Opening) + £24,000 (Gross Purchases) – £18,000 (Payments) – £500 (Discounts) – £1,000 (Contra) = £14,500. Note: Credit purchases must include VAT.

Question 6

A purchase of office equipment for £2,000 on credit was completely omitted from the accounting records. Which journal entry corrects this error?

TheoryPractice · Accepted Answer

Dr Office Equipment £2,000, Cr Payables £2,000. This is an error of omission. Record the full double entry: Debit Office Equipment to increase assets and Credit Payables to increase liabilities.

Question 7

Calculate the net VAT payable to HMRC given the following figures for the quarter (Standard VAT rate is 20%). Category Amount Note Standard Rated Sales £100,000 Net figure Standard Rated Purchases £36,000 Gross figure Zero Rated Sales £10,000 Net figure

TheoryPractice · Accepted Answer

£14,000. Output VAT: £100,000 × 20% = £20,000. Input VAT: £36,000 × 20/120 = £6,000. Net Payable: £20,000 – £6,000 = £14,000. Zero-rated sales attract £0 VAT.

Question 8

The Sales Ledger Control Account shows a balance of £50,000, while the list of balances from the Sales Ledger totals £49,800. Which error explains this £200 difference?

TheoryPractice · Accepted Answer

Returns inwards of £200 omitted from the control account. The Control Account exceeds the ledger by £200. Returns inwards reduce customer balances; omitting this credit from the control account leaves its balance overstated by that amount.

Question 9

A machine with an original cost of £15,000 is sold. Which pair of journal entries correctly transfers the cost and accumulated depreciation to the disposal account?

TheoryPractice · Accepted Answer

Dr Disposal, Cr Asset Cost; Dr Acc. Dep., Cr Disposal. Disposal removes the asset cost (Credit Asset, Debit Disposal) and accumulated depreciation (Debit Accumulated Depreciation, Credit Disposal) to determine profit or loss.

Question 10

How is the closing inventory balance recorded in the financial statements' year-end trial balance adjustments?

TheoryPractice · Accepted Answer

Dr Inventory (SFP), Cr Cost of Sales (SPL). Closing inventory is recognized as an asset (Debit Inventory SFP) and reduces the cost of goods sold (Credit Cost of Sales SPL).

AAT Qualification Test Prep Exam Questions & Answers 2026 (11–20)

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