WAEC Accounting 2017 Theory — Question 6

Model answer

(i) Unpresented cheques: These are cheques that have been issued/written and recorded in the cash book but have not yet been presented to the bank for payment, so they do not yet appear on the bank statement. (ii) Standing order: This is an instruction given by an account holder to the bank to make regular fixed payments to a third party at specified intervals (e.g. monthly), without the need for a fresh instruction each time. (iii) Credit transfer: This is a method by which a payer instructs the bank to transfer money directly into the bank account of a payee.