Multiple Choice
Questions
Questions
Which item is not included as part of the capital cost of a new machine?
A cost of delivering the machine to the factory
B cost of installing the new machine
C interest on a loan used to buy the machine
D invoice price of the machine
C interest on a loan used to buy the machine
A business values its inventory at the lower of cost and net realisable value.
Which accounting concept is being applied?
A business entity
B duality
C matching
D prudence
D prudence
Which business document contains details of purchases, returns and payments occurring during
a trading period?
A credit note
B debit note
C invoice
D statement of account
D statement of account
A machine which cost $32 000 was sold for $14 000. The total depreciation at the date of disposal
was $15 000.
What was the profit or loss on disposal?
A $3000 profit
B $3000 loss
C $18 000 profit
D $18 000 loss
B $3000 loss
How many papers are there in A Levels from 2023
A 1
B 2
C 3
D 4
B 2
The bank statement of a business showed a credit balance of $4520. This did not agree with the cash book. The following were discovered.
1 Bank charges of $89 had not been entered in the cash book.
2 There were unpresented cheques paid to suppliers of $680.
3 A dishonoured cheque for $210 appeared on the bank statement, but was not shown in the cash book.
4 Sales receipts of $750 had been entered in the cash book, but did not appear on the bank statement.
What is the bank balance to be shown in the statement of financial position?
A current asset $4501
B current asset $4590
C current liability $4450
D current liability $4539
B current asset $4590
What may help a book-keeper detect errors in the accounting records of a business?
1 books of original entry
2 sales ledger control account
3 statement of financial position
4 trial balance
A 1 and 3
B 2 and 3
C 2 and 4
D 3 and 4
C 2 and 4
Fill in the blanks
Name the section of the statement of financial position where inventory is shown
Current assets section of the Statement of Financial Position
A sports club provided the following information.
subscriptions for the year 26 800
profit on sale of refreshments 4 200
depreciation 1 500
rent and insurance 12 600
wages 3 200
What was the total income for the year?
A $15 800
B $17 300
C $22 600
D $31 000
D $31 000
What is the duration of Paper 4?
A 45 mins
B 1 hours
C 1 hour 15 mins
D 1 hour 30 mins
B 1 hour
Esarba has a financial year end of 31 December.
On 31 March 2020, she transferred her private vehicle to the business at a value of $12 000.
Her profit for the year ended 31 December 2020 was $7800 and her cash drawings amounted to
$8000. Depreciation of $900 had been provided on the vehicle.
She also took goods for her own use with a cost price of $1000 and a selling price of $2000.
What was the increase in Esarba’s capital account balance in the year ended 31 December 2020?
A $8900 B $9800 C $9900 D $10 800
D $10 800
At the end of his first year of trading, the trader lost all of his inventory in a fire. He knows the
values of sales and purchases and wishes to calculate the value of the inventory lost.
Which ratio should he use?
A gross margin
B profit margin
C trade payables turnover
D trade receivables turnover
A gross margin
Which business document is used to update the cash book for standing order payments?
A bank statement
The following balances appeared in Hussein's books.
$
fixtures 6000
inventory 3300
trade receivables 3000
trade payables 4500
other receivables 500
other payables 300
loan to Imran 1000
bank overdraft 1400
What was the total of the liabilities?
A $4800 B $6200 C $6400 D $7200
B $6200
Ethics in Accounting is given its due weightage in the new syllabus in 2023?
A True
B False
True
Which situation is not usually suitable for the use of marginal costing?
A negotiating a regular selling price with a customer
B quoting a selling price for a special order
C when there is a shortage of direct material for the next month
D whether to make or buy-in a product
A negotiating a regular selling price with a customer
Which accounting concept is being applied when calculating depreciation?
A business entity
B matching
C materiality
D substance over form
B matching
Which items will not be shown in an income statement prepared for a service business?
1 cost of sales
2 gross profit
3 profit for the year
4 wages paid to employees
A 1 only B 1 and 2 C 2 and 4 D 3 and 4
B 1 and 2
The average inventory of a business was $40 000. The rate of inventory turnover was 5 times a
year. Mark-up was 20%.
What was the revenue for the year?
A $160 000 B $200 000 C $240 000 D $250 000
C $240 000
Is Consignment and Joint Venture a part of the new syllabus starting 2023
A Yes
B No
No
Which factors should be considered when setting a budget?
1 availability of skilled labour
2 production capacity
3 quality of goods to be produced
A 1, 2 and 3
B 1 and 2 only
C 1 and 3 only
D 2 and 3 only
A 1, 2 and 3
Which are not appropriations of partnership profit?
1 interest on capital
2 interest on drawings
3 interest on loan from partner
4 partner’s drawings
A 1 and 3
B 1 and 4
C 2 and 3
D 3 and 4
D 3 and 4
What are the sources of information for entries in control accounts?
A bank statements
B books of prime entry
C ledger accounts
D sales invoices
B books of prime entry
When Mark started a car repair business, he purchased premises and equipment.
Two years later he spent $5000 on building an extension, $600 on new equipment and $750 on
repainting the original premises.
By how much will the non-current assets increase because of these transactions?
A $5000 B $5600 C $5750 D $6350
B $5600
There are 3 assessment objectives in the new syllabus in 2023.
A True
B False
A True