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The following is an extract of the trial balance of XYZ as at 31 December 20X7
What is the total value of assets to be included in the statement of financial position? Give your answer to the nearest $
Refer to the Exhibit.
Which of the following items should be included in the valuation of inventory in a manufacturing company?
Refer to the Exhibit.
Which of the following would be the opening balance on the bank ledger account?
A trader commenced business with capital of $20,000. At the end of the financial year he had receivables of $10,000, payables of $6,000, inventory of $12,000, cash of $4,000 and non-current assets costing $16,000.
The profit/loss for the period was:
A public limited company declares a 10% final dividend.
The nominal value of the shares is 50p and the shares are currently trading, in the stock market, at a price of £2.
A shareholder who purchased 1000 shares at a price of £1.00 per share, will receive a dividend of:
Give your answer to 2 decimal places.
A company's cashbook has an opening balance of £4,860 debit. The following transactions then took place:
(a) Cash sales - £23,500, including VAT of £3,500
(b) Receipts from customers - £18,600
(c) Payments to payables £12,400, less cash discounts of £240
(d) Bank Charges - £260
What will be the resulting balance in the cash book?
Refer to the exhibit.
The following extracts from the statement of financial position and income statement for Company S are available:
Included in operating profit was depreciation of $120,000 and a loss on disposal of non-current assets of $48,000.
The cash generated from operations for year 2 would be:
Refer to the exhibit.
The following information is available in respect of two companies that operate in the same market sector:
Which one of the following statements most accurately describes the companies' relative position?
Refer to the Exhibit.
At the beginning of the year, the balance on the allowances for receivables account was £5000, representing 2% of receivables. At the end of the year, receivables amounted to £150000, but it was decided that the provision should be increased to 3% of receivables.
Which of the following set of figures would result?
The answer is:
Refer to the Exhibit.
At the beginning of the month, an organization had opening inventory of 30 units of a product, valued at £3.00 each. During the month, it had inventory movements, occurring on the following dates:
Using the FIFO method of inventory valuation, the closing inventory at the end of the month was:
Give your answer to 2 decimal places.
Refer to the Exhibit.
What is the correct ledger entry for purchase of goods on credit?
The answer is:
“To assure shareholders that the stewardship of the organization was effectively carried out.”
What does this definition describe?
Refer to the Exhibit.
Berber Limited is preparing its year-end accounts and is reviewing the method used to estimate the allowance for receivables.
An aged receivables schedule shows the following position:
The company believes that the previous percentages used were not prudent enough and it has decided to increase the percentages on 2-3 months debt to 10% and on 3 months plus debt to 50%. The current allowance for receivables is $1,500.
What would be the effect on the income statement of the change in accounting policy
GG has the following statement of profit or loss extract for the year ended 31 December 20X3
What is the interest cover for GG for the year ended 31 December 20X3?
2.8 times
4.0 times.
4.5 times
3.5 times
Refer to the Exhibit.
The following totals appear in a company's daybooks for the month of May. VAT is recoverable on all purchases which were in respect of goods for resale.
Opening inventory was £350,00 and closing inventory was $37,500.
The gross profit for the period was
Accountant P debited wages with £1,000 instead of £1,500, but credited sales with £1,500 instead of £2,000.
Which of the following kind of bookkeeping mistakes is this?
Refer to the Exhibit.
Accounting information is required for a wide range of users both internal and external. Each user has a different need for the information.
Which of the following is the correct combination of user and need?
Refer to the exhibit.
A company has the following current assets and liabilities at its most recent year end:
When measured against standard acceptable levels for liquidity, the company can be said to have:
A business needs to reconcile its cash book with the current bank statement on a regular basis
Which THREE of the following items could require an adjusting entry in the cash book?
Which of the following is not a correct definition of the accounting equation?
An accountant is taking on financial accounting responsibilities for company PQ. Which TWO of the following are NOT true of financial accounting?
An external audit is an independent examination of, and expression of opinion on the financial statements of an entity.
Who of the following appoints the external auditor?
IAS 2 Inventories does not permit the use of the last in. first out (LIFO) method of valuing inventory In a time of rising prices, which of the following is a reason for this?
Which one of the following would not be considered one of the roles of a Financial Accountant?
Which of the following entries would result in the trial balance not agreeing?
(a) An invoice for £200 for electricity has been omitted from the ledgers
(b) A payment received from a customer has been posted to the accounts twice
(c) An invoice for repairs and maintenance has been charged to the non-current asset account
(d) A payment made to suppliers had been recorded in the cash book but not recorded in the supplier's account
Refer to the Exhibit.
A company has the following transactions for an accounting period:
Closing inventory at the end of the period was $3,200 and gross profit was $16,400.
The opening inventory was therefore
The total of the debit column of a trial balance is $800 bigger than the credit column.
Which of the following is the entry recorded in the suspense account?
A company has a receivables balance at the end of the year of £120,000. The company maintains an allowance for receivables at 3% of closing receivables. The opening balance on the allowance was £ 2,880. During the year bad debts of £ 3,000 were written off
The total charge for bad debts for the year is £
The accounting concept which states that non-current assets should be valued at cost (or valuation) less accumulated depreciation, rather than their saleable value in the event of closure, is the.
Refer to the exhibit.
Ronald has the following assets and liabilities at 31 December:
The capital balance at 31 December was
Refer to the exhibit.
Jordan has the following assets and liabilities at 1 January:
What is the capital balance at 1 January?
MM does not maintain complete accounting records The following information is available for the year ended 31 December 20X3.
The mark up on items sold by MM is 20%
What is the figure for purchases to be included in MM's statement of profit or loss for the year ended 31 December 20X3?
A company which is VAT-registered receives an invoice for goods purchased for resale totaling $2,585 from a supplier that is not VAT-registered. VAT is at the rate of 17.5%.
The correct entry to record the invoice is:
A)
B)
C)
D)
Which of the following does not necessarily need to be true for something to be treated as an asset in an entity's statement of financial position?
Refer to the Exhibit.
A company has the following chart of accounts:
The sales director of the northern region wants to know what the total sales of widgets are for the first quarter of the year.
Which code would he request for his report?
Which FOUR of the following should be categorised as a DEBIT (DR) when filling out a T-account?
Refer to the Exhibit.
The purchase ledger control account shows a balance of £324,564, while the individual customer account balances total £328,234.
Which of the following is a possible explanation for the difference between the two?
Which of the following would result in an increase in the cash balance for the period?
(a) A reduction in inventory
(b) A reduction in receivables
(c) A reduction in payables
(d) A gain on disposal of non-current assets
CDE, an entity registered for sales tax, purchases a piece of equipment for cash on 31 December 20X6 for $30,000 including sales tax. The sales tax rate is 20%. What is the journal entry required to record this transaction in the nominal ledger?
Place the labels in the corresponding position in the table below:
A business has expanded rapidly during the current year. As a result the accounting records have been building up and the management accountant is having problems producing reports for each department head.
Which of the following would be the best solution if introduced?
An invoice to Sammy has been entered in the sales day book as $85 instead of $58.
To correct the position, which of the following procedures should be adopted?
The system of double entry book keeping relies upon accuracy of entries
Which of the following combinations represent credit balances?
Refer to the Exhibit.
A business writes a cheque using its overdraft balance to purchase new display shelving for its showroom
Which of the following is the dual effect?
A company's payables days has reduced from 60 days to 55 days.
Which of the following could be a possible explanation for this?
The suspense account of a company was opened with a credit balance of $360 when the trial balance failed to agree.
This could have arisen because
The petty cash imprest is restored to £500 at the end of each week. The following amounts are paid out of petty cash during week 23:
(a) Stationery - £70.50 (including VAT at 17.5%)
(b) Travelling costs - £127.50
(c) Office refreshments - £64.50
(d) Sundry payables - £120.00 plus VAT at 17.5%
The amount required to restore the imprest to £500.00 is:
Give your answer to 2 decimal places.
A company that is VAT-registered has sales for the period of $245,000 (excluding VAT) and purchases for the period of $123,375 (including VAT). The opening balance on the VAT account was $18,000 credit. The VAT rate is 17.5%.
What will be the closing balance on the VAT account at the end of the period?
Refer to the Exhibit.
A company has the following information available for the month of June:
The opening receivables balance was $124,600.
The closing receivables balance at the end of June was
The draft accounts of KenDoo Ltd for the year ended 31 August 2006 showed a net profit of $10000.
During the audit, the following errors and omissions were discovered.
(a) Items valued at $3100 had been completely omitted from the closing stock figure.
(b) Accrual of electricity bill for $200 and insurance prepayment of $500 had been omitted.
(c) Equipment costing $12000, acquired on 1 September 2005, had been debited to the purchases acccount. (KenDoo Ltd depreciates equipment at 15% on the straight line basis).
Due to materiality, the directors of KenDoo Ltd agreed to adjust the accounts accordingly.
Incorporating the above adjustments, the revised net profit is
TESTED 21 Dec 2024
