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1

Which item is classed as revenue expenditure?

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

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

Open

2

What is the purpose of depreciation?

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

Open

3

A company’s year end is 30 April. It purchases a factory in May 2014 at a cost of $200 000. The factory will be depreciated over 20 years. A full year’s depreciation is charged in the year of purchase. In May 2017 the factory is revalued at $300 000. How much should be included in the revaluation reserve account?

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

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

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

Open

4

A business has a year end of 31 December. It purchased a non-current asset on 1 January 2014 for $100 000. It was depreciated using the reducing balance method at 20% per annum. It was sold for $40 000 on 1 January 2016. What was the loss on disposal?

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

Open

5

Why does a business keep 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

Open

6

A sales ledger control account had a debit balance of $38 600. The total of individual sales ledger debit balances was $36 500. The only errors found were as follows. An irrecoverable debt had been recorded in the ledger of Smith but not the control account. The sales journal was undercast by $1500. A contra of $1750 had been correctly recorded in the control account but only $1250 recorded in the ledgers. What was the value of the irrecoverable debt?

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

Open

7

The following information is available. $ provision for doubtful debts at the beginning of the year 6 250 trade receivables at the end of the year 93 750 Provision for doubtful debts is to be maintained at 6% of trade receivables. Which effect will the provision for doubtful debts have on profit for the year in the income statement?

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

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

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

Open

8

At 31 December the following information is available about a company’s banking transactions. $ balance at bank per bank statement 22 650 uncleared deposits 3 110 unpresented cheques 6 290 bank credit recorded twice by bank in error Which value for bank should be recorded in the statement of financial position at 31 December?

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

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

Open

9

Hedley has 100 items of inventory in his warehouse and five more with a customer on a sale or return basis. He provides the following information. $ per unit historic cost paid selling price current replacement cost Which value should appear in the statement of financial position for inventory?

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

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

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

Open

10

A business does not keep complete accounting records. The following information is known for the year. $ capital at start 52 000 capital at end 55 000 drawings 13 000 capital introduced 25 000 What is the profit or loss for the year?

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

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

Open

11

A business has 500 items of inventory at a cost price of $3 each. The selling price per unit is based on a mark-up of 20%. Before sale, the items need to be repaired at a total cost of $400. What is the net realisable value of the inventory?

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

12

The following information is available for the year ended 31 December 2016. $ revenue 75 000 purchases 32 000 carriage inwards 5 400 carriage outwards 4 500 inventory at 1 January 2016 6 300 inventory at 31 December 2016 7 600 What was the gross profit for the year ended 31 December 2016?

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

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

Open

13

A partnership maintains capital accounts and current accounts. Which statements are correct?

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

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

Open

14

X, Y and Z had been in partnership, sharing profits and losses in the ratio of 2 : 2 : 1. On 1 January 2017, Y retired. The balances of his capital and current accounts were as shown...

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

S and T are in partnership, sharing profits and losses in the ratio 2 : 1. The balances on their capital accounts at 31 March 2017 were: $ capital account S 40 000 capital account T 20 000 60 000 On 1 April 2017 the partners decide to change the profit-sharing ratio to 3 : 2. Goodwill is to be valued at $30 000 and is not to be retained in the books of account. What is the new balance of T’s capital account?

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

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

Open

16

A partnership provides the following financial information for the year ended 30 June 2017. $ profit from operations 240 000 bank interest payable 21 000 interest on capital 15 000 drawings 50 000 partnership salaries 45 000 What is the residual balance of profits to be appropriated between the partners?

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

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

Open

17

Which accounting entry could record the issue of bonus shares?

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

Open

18

From which accounts can a company pay dividends?

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

Open

19

A company provides the following data on 1 January 2016. $ 10% debentures (2020) 200 000 bank loan (2017) 130 000 bank loan (2018) 10 000 bank overdraft 24 000 What is the total value of non-current liabilities at 31 December 2016?

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

Open

20

Calculation of which ratio does not include revenue?

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

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

Open

21

Bradshaw does not keep proper books of account. The following information is available for the year. cost of sales $750 000 mark-up 20% cash sales $300 000 trade receivables $46 000 What are total sales and trade receivables turnover?

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

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

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

Open

22

The financial statements of a company showed the following. $ current liabilities 15 000 non-current liabilities 40 000 ordinary shares 120 000 general reserve 10 000 retained earnings 46 000 interest paid 11 000 Profit for the year was $23 000. What was the return on capital employed?

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)  →  3.5. Analysis and communication of accounting information

Open

23

Which item is an indirect cost?

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

24

The following information is forecast for next period. units opening inventory 54 275 closing inventory 60 120 $ profit using marginal costing 300 600 profit using absorption costing 390 780 What is the overhead absorption rate per unit?

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

25

A business has total fixed costs of $240 000. Products have a unit selling price of $25 and a unit variable cost of $15. How many units need to be 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

26

The table contains information provided by a company. budgeted direct labour hours actual direct labour hours worked budgeted overhead expenditure $104 000 actual overhead expenditure $112 500 What is the over or under recovery of overheads?

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

The diagram illustrates the cost behaviour of a typical telephone invoice. total cost $ level of activity Which term best describes the behaviour of this cost?

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

28

Which statements about the limitations of marginal costing are correct?

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

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

Open

29

A product has a variable cost of $31.32 per unit. Total fixed costs are $93 600. When production is 13 000 units the margin of safety is 5000 units. What is the selling price per unit?

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

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

Open

30

Why is planning important to a business?

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

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

Open