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1

What would not be a purpose of ledger accounts?

1. Financial accounting (AS Level)  →  1.2. The accounting system

1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements

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2

Which accounting concepts apply to depreciation?

1. Financial accounting (AS Level)  →  1.2. The accounting system

1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets

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3

A motor vehicle was purchased for $12 000 on 1 January 2015. Its estimated residual value was $7000 and expected life 5 years. Depreciation was calculated on a month-by-month basis using the straight-line method. It was sold on 30 June 2017 and there was a loss on disposal of $2560. What were the sale proceeds?

1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets

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4

The following information relates to a motor vehicle part-exchanged for a new vehicle in the year. $ cost of old vehicle 20 000 accumulated depreciation at the date of sale 8 000 profit on disposal 3 000 cost of new vehicle 25 000 The balance payable for the new vehicle was paid from the business bank account. How much was the payment from the bank account?

3. Financial accounting (A Level)  →  3.1. Preparation of financial statements

1. Financial accounting (AS Level)  →  1.2. The accounting system

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5

The table shows information in a purchases ledger control account at the year-end. $ cash paid to suppliers 36 000 credit purchases 55 000 discount received 7 800 balance carried down (balancing figure) 35 000 What was the credit balance brought down at the beginning of the year?

1. Financial accounting (AS Level)  →  1.4. Reconciliation and verification

1. Financial accounting (AS Level)  →  1.2. The accounting system

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6

A sole trader withdraws goods for his own use. How does this affect his financial statements?

1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements

3. Financial accounting (A Level)  →  3.1. Preparation of financial statements

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7

Which error would affect the balancing of a trial balance?

1. Financial accounting (AS Level)  →  1.4. Reconciliation and verification

1. Financial accounting (AS Level)  →  1.2. The accounting system

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8

Which group would appear only on the credit side of a sales ledger control account?

1. Financial accounting (AS Level)  →  1.4. Reconciliation and verification

1. Financial accounting (AS Level)  →  1.2. The accounting system

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9

A company has a year-end of 31 December. Its inventory records on that date showed an inventory of 600 units with a cost of $10 each. A fire on 31 December had totally destroyed 100 units and caused a further 50 units to be damaged. These would cost $7 each to be repaired. The inventory records had not been adjusted for the fire. The selling price is $15 per unit. What is the value of the inventory to be used in the financial statements at 31 December?

3. Financial accounting (A Level)  →  3.1. Preparation of financial statements

2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour

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10

A business has a draft profit for the year of $182 750. The following adjustments have not yet been made. a decrease of $2800 in the provision for doubtful debts a prepayment of rent by the tenant of $3900 at the year-end What is the actual profit for the year?

1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements

3. Financial accounting (A Level)  →  3.1. Preparation of financial statements

4. Cost and management accounting (A Level)  →  4.3. Budgeting and budgetary control

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11

Which rule does not apply in the absence of a partnership agreement?

1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements

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12

The partnership of Ravi and Tania, who shared profits equally, was dissolved. The capital accounts prior to dissolution were Ravi $50 000 and Tania $60 000. The current accounts balances prior to dissolution were Ravi $35 000 credit and Tania $35 000 credit. The loss on disposal of partnership net assets was $10 000. How much money did each partner receive when the partnership was dissolved?

3. Financial accounting (A Level)  →  3.1. Preparation of financial statements

1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements

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13

A company issues 50 000 ordinary shares of $5 each at a premium of $15. It also issues a 4% debenture, $300 000. By which amount do the net assets of the company increase?

1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements

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14

Which statements describe a capital reserve?

1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements

1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets

3. Financial accounting (A Level)  →  3.1. Preparation of financial statements

Open

15

The following is an extract from a statement of changes in equity. ordinary share capital $ share premium $ general reserve $ retained earnings $ balance at the start of the year 75 000 15 000 45 000 During the year the following occurred. An interim dividend of $4875 was paid. A final dividend of $6000 was proposed. $2500 was transferred to the general reserve. What was the balance of retained earnings at the end of the year?

1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements

3. Financial accounting (A Level)  →  3.1. Preparation of financial statements

3. Financial accounting (A Level)  →  3.5. Analysis and communication of accounting information

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16

The following has been extracted from the financial statements of a business. $ revenue 135 000 total capital employed 575 000 non-current assets 180 000 What is the non-current asset turnover?

1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets

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17

The statement of financial position of X Limited at 31 December 2017 shows the following. $000 non-current assets current assets ordinary share capital general reserve 10% debentures current liabilities retained earnings The profit from operations for the year was $65 000 and the finance costs were $20 000. What is the return on capital employed for 2017?

1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets

1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements

Open

18

Which business would use a job costing system of accounting?

1. Financial accounting (AS Level)  →  1.2. The accounting system

4. Cost and management accounting (A Level)  →  4.2. Standard costing

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19

What is a direct cost?

2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour

4. Cost and management accounting (A Level)  →  4.1. Activity based costing (ABC)

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20

A company pays its employees $6.80 per hour for a basic 40-hour week. An overtime premium of 50% is payable together with a production bonus of $0.25 per unit for all units produced over 350. Employees are guaranteed a weekly wage of $330. One employee worked 45 hours last week and produced 410 units. What was the employee’s gross pay that week?

4. Cost and management accounting (A Level)  →  4.3. Budgeting and budgetary control

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21

Adam records his inventory using the AVCO (perpetual inventory) to calculate its value. Which statement is correct?

2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour

3. Financial accounting (A Level)  →  3.1. Preparation of financial statements

Open

22

Which statements about absorption costing are correct?

2. Cost and management accounting (AS Level)  →  2.2. Traditional costing methods

2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour

Open

23

How is the margin of safety calculated?

4. Cost and management accounting (A Level)  →  4.3. Budgeting and budgetary control

2. Cost and management accounting (AS Level)  →  2.2. Traditional costing methods

Open

24

A business provides the following information about a product. $ variable cost per unit selling price per unit total fixed costs 35 000 budgeted profit 95 000 How many units should it produce to achieve the budgeted profit?

4. Cost and management accounting (A Level)  →  4.3. Budgeting and budgetary control

2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour

Open

25

A business provides the following financial information. $ per unit selling price direct materials direct labour variable overhead fixed overhead profit What is the marginal cost per unit?

2. Cost and management accounting (AS Level)  →  2.2. Traditional costing methods

4. Cost and management accounting (A Level)  →  4.2. Standard costing

Open

26

Which factor will determine the optimum production plan in a limited resource situation?

4. Cost and management accounting (A Level)  →  4.3. Budgeting and budgetary control

2. Cost and management accounting (AS Level)  →  2.2. Traditional costing methods

Open

27

A company manufactures two products. per unit product X $ product Y $ selling price direct labour direct materials Total fixed costs are $54 000. Only 3000 units of Y can be made and sold. How many units of product X must be made and sold to break even?

2. Cost and management accounting (AS Level)  →  2.2. Traditional costing methods

2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour

Open

28

A company uses absorption costing and makes and sells one product. In the last month budgeted overheads totalled $60 000. Budgeted production was 15 000 units and budgeted sales were 14 000 units. The company now decides to apply marginal costing principles for last month. What effect will this have on profits?

2. Cost and management accounting (AS Level)  →  2.2. Traditional costing methods

Open

29

A business has recorded the following total costs for the last two months. units produced total costs ($) month 1 8 000 31 800 month 2 10 000 36 700 What was the total fixed cost per month?

2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour

4. Cost and management accounting (A Level)  →  4.3. Budgeting and budgetary control

Open

30

A company has recently introduced a system of budgetary control. Workers have given the following reasons for materials costs being more than budgeted. Budgeted material costs are incorrect. Production machinery is outdated and wastes materials. The company should purchase better quality materials to reduce wastage. Which reasons will cause actual material costs to be different from the budgeted costs?

4. Cost and management accounting (A Level)  →  4.3. Budgeting and budgetary control

2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour

Open