---

---

1

A vehicle cost $30 000. The vehicle was later sold for $9000 and the profit on disposal was $1500. What was the accumulated depreciation of the vehicle on disposal?

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

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

Open

2

A transport business owned by a sole proprietor purchases a motor vehicle. This is charged to the Motor expenses account. What are the effects of this on the end-of-year balance sheet?

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

Open

3

A business buys a computer for $2200 on 1 January 2007. The computer will be used for four years, after which time it will be sold for $280. The business uses the straight-line method of depreciation. What is the depreciation charge for the year ended 31 December 2008?

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

Open

4

The following information is taken from the stationery account of a business. $ stock of stationery at beginning of the year cash paid for stationery during the year amount owing for stationery at end of year stock of stationery at end of year How much should be debited to the profit and loss account for stationery?

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

Open

5

Development costs are capitalised. Which accounting principle is being applied?

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

Open

6

The table shows information from a business at 30 November 2008. $ Credit sales invoiced during financial year 80 000 Goods despatched to customers in November 2008 and invoiced in December 2008 5 000 Goods included in sales for November 2008 on a sale or return basis, but only sold in December 2008 – at invoice price 10 000 – at cost price 8 000 Which amount will appear in the trading account as sales for the year ended 30 November 2008?

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

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

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

Open

7

In preparing the profit and loss account, only realised profits and not anticipated profits must be brought into account. In addition, all possible losses must also be taken into account. Which accounting principle does this describe?

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

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

Open

8

Entries of $700 in the discount received account had not been entered in the creditors’ ledger. During the year a machine was sold for $1000. There was only one entry made and it was a credit in the bank account. What is the balance on the suspense account?

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

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

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

Open

9

The correct balance on the purchases ledger control account is $63 000 but has been entered in the trial balance as $36 000. The difference on the trial balance has been entered in a suspense account. Which journal entry corrects this error?

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

Open

10

Who is most likely to use the creditors’ ledger?

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

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

Open

11

A business sells some of its stock for $500 on credit to a customer. The stock originally cost $600. What is the effect of this transaction on the balance sheet?

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

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

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

Open

12

A company’s policy is to depreciate its equipment by 30 % annually using the reducing balance method. A piece of equipment which was two years old was sold for $6000 and the profit on sale was $1590. What was the cost price of the equipment?

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

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

Open

13

Which expense is included in prime cost of manufacturing?

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

Open

14

A company manufactured 3000 widgets and transferred them out of its factory at cost plus 20 %. per widget $ selling price direct materials direct labour fixed overheads What is the factory cost of goods manufactured as it would appear in the trading account?

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

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

Open

15

X and Y are partners in a business. X receives an annual salary of $5000 from the partnership and the balance of profits and losses is shared between X and Y in the ratio of 3 : 2 respectively. In the last financial year, the net profit was $30 000. How much was credited to each partner for the year?

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

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

Open

16

An extract from a company’s trial balance is shown...

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

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

Open

17

The following items appear in the subscriptions account of a club for a financial year. $ subscriptions received owed from the previous year 3 000 subscriptions paid in advance for next year 1 000 subscriptions income transferred to the income and expenditure account 50 000 subscriptions outstanding at year end 2 000 How much cash was received from members in the year?

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

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

Open

18

The directors of a company provide the following information. $ bank overdraft 1 200 equipment 12 000 long term loan 8 000 petty cash stocks 2 500 trade creditors 3 000 trade debtors 2 000 What is the amount of the net current assets?

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

4. Cost and management accounting (A Level)  →  4.4. Investment appraisal

Open

19

A company profit and loss account includes: $000 dividend increase in stock overheads purchases If the net profit percentage is 20 %, what is the figure for sales?

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

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

Open

20

A shareholder sells some ordinary shares for more than he paid for them. What is the effect on the company balance sheet?

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

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

Open

21

At the beginning of the year a company has authorised share capital of 800 000 ordinary shares of $0.25 each and an issued share capital of 400 000 ordinary shares of $0.25. During the year the company makes a further issue of 200 000 ordinary shares at a price of $0.60. What is the balance on the share capital account 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

Open

22

Assets and liabilities of a business at its year end include the following information. $ accruals 5 000 bank overdraft 6 800 cash prepayments 4 500 proposed dividend 12 000 stock 51 800 trade creditors 20 100 trade debtors 24 200 What is the current ratio?

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

1. Financial accounting (AS Level)  →  1.6. Analysis and communication of accounting information

Open

23

Which actions would improve the liquidity (acid test) ratio of a business in the short term?

1. Financial accounting (AS Level)  →  1.6. Analysis and communication of accounting information

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

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

Open

24

A business has a debtor turnover period of 40 days based on year end debtors. Annual sales are $180 000 of which 13 % are cash sales. What is the year end debtors figure based on a year of 360 days?

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

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

1. Financial accounting (AS Level)  →  1.6. Analysis and communication of accounting information

Open

25

A company has an issued ordinary share capital of 240 000 ordinary shares of $0.50 each. The company pays a total ordinary share dividend of $9600. The current market price of an ordinary share is $3.20. What is the current dividend yield?

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

Open

26

Which name is given to the difference between a company’s actual sales and break-even sales?

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

Open

27

What best describes cost of direct materials plus direct labour costs?

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

Open

28

A company has the information shown...

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

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

Open

29

A business has fixed costs of $100 000. It sells a single product for $25 per unit, and its contribution to sales ratio is 40 %. What is the break-even point in units?

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

Open

30

The following figures are given for a factory’s overheads and machine hours worked. machine hours total overhead costs overhead absorption rate budgeted 122 000 $268 400 $2.20 actual 116 000 $261 000 $2.25 What was the under- or over-absorption of overhead for the quarter?

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

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

Open