4) 2) 3) MC@ © (Exam ©) ‘What would not be included in a statement of changes in equity? A ordinary share dividend paid which relates to the previous year B ordinary share dividend proposed which relates to the current year C profit for the year D__ transfer to general reserve (1) Beth and Carla are in partnership, sharing profits and losses 3:2. They provided the following information at 31 January 2018. $ $ Profit for the year 42000 Interest on capital: Beth 4000 Carla 3000 7000 Salary: Beth 10000 What was the total amount credited to Beth's current account on 31 January 2018? A $15000 $25200 B ¢ $29000 D $39200 (1) Some members of a sports club had not paid their annual subscriptions at the end of the financial year. Where will these unpaid subscriptions be shown in the financial statements? receipts and income and statement of Payments account | expenditure account | financial position A v v v B v v c v v o XN XN 1]f 4) 5) © disposal account showed the following. Disposal account i $ $ lachinery 6200 | Provision for depreciation | 2100 Bank 3800 Income statement 300 6200 6200 Which book of prime entry was used to transfer the $300 to the income statement and how was it treated there? book of prime entry | treatment in income statement A | general journal as a loss B | general journal as a profit c sales journal as aloss D sales journal as a profit (1) Sasha buys radios at $20 each. At the year end she has 50 radios in inventory. Of these, 3 radios are damaged and will cost $17 each to repair. All the radios are expected to be sold at $30 each. What is the value of inventory in the statement of financial position? A $979 B_ $1000 Cc si449 D $1500 [1]6) ED) 8) ® Which busi i . businesses are trading businesses and which are service businesses? trading business service business A food retailer hairdresser B food retailer and ‘i hairdresser ham Cc hairdresser food retailer D neither eaten and An appropriation account showed the following. interest on drawings interest on capital share of residual profit Sumit Tom Sumit Tom Sumit Tom ‘What was the total profit for the year? A $7500 B $11500 Cc $12000 D $12500 A subscriptions account showed subscriptions in arrears, $400, at the start of the ‘subscriptions in advance, $100, at the end of the year. Subscriptions of $15000 received during the year. Which value for subscriptions appeared in the income and expenditure account? A $14500 B $14700 C $15300 D $15500 1300 1200 1000 1000 8000 4000 Lo n (1 year, and had been Ot]4) to) iD) @ Amanufacturer Provided the following information. $ Purchases of raw materials direct labour 38000 factory overheads 22000 At the year end inventory of raw materials had increased by $4000. Inventory of finished goods had increased by $9000. What was the cost of sales? A’ $37000 $46000 B Cc $117000 D $126000 (1) Atrader provided the following information. $ revenue 1050 opening inventory 50 purchases 800 closing inventory 150 Which mark-up had been applied? A 16.67% 31.25% B C 33.33% in D 50% 1) Barak did not maintain a full set of accounting records in his first year of trading. How did Barak calculate his credit sales? A closing trade receivables + cash received — discount allowed B closing trade receivables + cash received + discount allowed C closing trade receivables + cash received — discount received D closing trade receivables + cash received + discount received (1)ta) 13) 14) 15) @ Which statement describes a Purpose of accounting? AL to check the arithmetical Accuracy of the double entry B to ensure that al transactions are recorded C] c to know the balances on individual Customers’ and suppliers’ accounts D to provide a calculation of profit (1) A credit customer buys goods with a list pri it is 30% and cash discounts 10% ge ist price of $1000. Trade discount is 30% an ‘Which amount is entered in the customer's account to record the sale? A $600 B $630 fl c $700 D $900 {11 Where is unt allowed recorded? A onthe credit side of the purchases ledger control account B onthe credit side of the sales ledger control account onthe debit side of the purchases ledger control account D__ onthe debit side of the sales ledger control account a Ann's statement of financial position includes the following: 1 an amount paid by Ann for a service which has not yet been received 2 an amount received by Ann for a service which Ann has not yet provided 3. the value of a service received by Ann for which payment has not yet been made Which item(s) are included in ‘other payables’? A tand2 B tony © 2and3 D only (1)1 © Ie) A trader provided the following information at the end of the first year of trading. $ revenue Profit for the year a expenses 1400 closing inventory 800 What were the purchases for the year? A $2300 B $3900 Cc $4900 D $6700 a 1%) Atrader had a percentage of gross profit to revenue (gross profit margin) of 30%. His purchases for the year were $3400 and his inventory increased by $400. What was his revenue for the year (to the nearest dollar)? A $3900 B $4286 Cc $4940 D $5429 t] 18) When is financial information considered to be relevant? A whenitaffects business decisions when it can be compared with other periods B when it can be understood by the users D when itis free from error and bias (1)19) Which type of error did Min make? A commission —_ B Compensating SS © original entry SS D principle f 20) John is a retailer of garden furniture. He bought stationery, $25, on credit from A4 ‘Supplies. He did not record this in his books of account. Which entries are needed to correct the error? debit account credit account “A4 Supplies $25 | stationery $25 B | A4 Supplies $25 | suspense $50 stationery $25 C | stationery $25 A4 Supplies $25 $50 | A4 Supplies $25 Pe stationery $25 ay oes a> tements describe capital expenditure? 21) Which stat 4 Itis for an item which will last more than a year. 2 tis recorded in the income statement. 7 3 _ Itis recorded in the statement of financial position, 1and 2 4 and 3. 2only oo wu > 3 only ”2) 23) 24) ito wi i tat Hiro wishes to increase his Provision for doubtful debts at the end of the year. Z How does he record this increase? | debit entry credit entry A bad debts provision for doubtful debts 5 | B provision for doubtful debts bad debts c income statement provision for doubtful debts CL D provision for doubtful debts income statement lJ Thang bought goods costing $20 each. At the end of the year Thang valued unsold goods at the selling price of $30 each. What is the effect of this valuation? A. profitis overstated B profit is understated © _ purchases are overstated D__ purchases are understated ‘The directors of a limited company increased the general reserve. ‘Which item decreased? A balance at bank B_ ordinary share capital preference share capital D_ retained earnings OL (] inventory of 1 1)7 2D 26) 27) @ Atrader provided the following information about a non-current asset. cost 42000 accumulated depreciation at start of year 1800 meth i ethod of depreciation reducing (diminishing) balance at 15% per annum What was the accumulated depreciation at the end of the year? A $1530 rr B $3330 Cc $3600 I D $8670 tt) ‘The non-current assets of a sole trader increased. What might have caused this to happen? ‘A adecrease in the bank overdraft B__ an increase in trade receivables © _ the charging of depreciation 1D the introduction of capital by the owner n ‘The directors of a company provided the following information. $ total equity at start of year 426000 profit for the year 90000 dividend paid 40000 transfer made to general reserve 25000 What was the total equity at the end of the year? A $451000 $476000 $501 000 vo 8 516000 i23) 24) *) he total of the discount received column of the cash book, $80, was posted in error to the , $80, credit side of the discount allowed account. Which entries correct this error? debit account(s) $ | credit account(s) $ discount allowed 80 | discount received 80 discount allowed 80 | discount received 160 suspense 80 C | discount allowed 160 | discount received 80 | suspense 80 Lt D | discount received 80 | discount allowed 80 @ Which account or statement provides a summary A bank reconciliation statement B provision for doubtful debts account c sales ledger control account D _ statement of financial position a of transactions involving trade receivables? der compare his cash book with his bank statement? Why does a tra "o chook for errorsin the cash | to ensure the cash book is book upto date A no no B no yes c yes no D yes yes (1 (t]3i) 32) 33) Asma bought a motor vehicle for cost, calculated monthly. After 18 months she sold the motor vehicle for $9200. What was the profit on disposal? A $200 B $650 c $700 D $1200 © At the start of the year Basil had paid $4500 rent in advance. During the $12000. At the year end he owed $1500. What was Basil’s annual expense for rent? A $9000 B $12000 Cc $15000 D $18000 Aand B were in partnershi $10000. She depreciated it at the rate of 10% per annum on OO year he pai | iid rent, ip. Their current accounts for the year were as follows. A B A B $ $ $ $ drawings 7500 | 2500 | balance b/d 10200 | 12000 balance cfd 41700 | 17500 | interest on capital | 2000| 1000 share of profit 7000 | 7000 19200 | 20000 20000 balance b/d 11700 | 17500 ‘What was the profit for the year? A $7000 B $14000 c $17000 D $27000 (1) fy 3u) ‘Two companies, X Limited and Y Limited, provided the following information. X Limited Y Limited : $ $ Profit for the year 10000 10000 Revenue for the year 200000 100000 Capital employed 180000 300000 @ Which company had the higher profit to revenue percentage (net profit margin) and which had the higher return on capital employed (ROCE)? Profit to revenue percentage | return on capital employed A X Limited X Limited B X Limited Y Limited c Y Limited X Limited D Y Limited Y Limited 35) Abusiness provided the following information for the year. $ credit sales 44000 cash sales 3600 returns from credit customers 2000 gross profit margin 20% What was the gross profit for the year? A B c D $2400 $3120 $3520 $3900 0] (1Multiple Choice Answers (Exam C) Question | Answer 1 B 2 Cc 3 D 4 A 5 A 6 A 7 B 8 A 9 Cc 10 D il B 12 D 13 c 14 B 15 Cc 16 B 17 B 18 A 19 A 20 Cc 21 B 22 c 23 A 24 D 25 B 26 D 27 B 28 A 29 Cc 30 D 31 Cc 32. D 33 Cc 34 Cc 35 B