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accounts data bank




Question;Chapter;1;The;accounting world;1.Sole traders differ from other types of;trading organizations. Which of the following statements;correctly;summarizes the key characteristics of a sole trader?s business?;(a);Liability is limited to the providers of loan finance and only the trader takes;an active part in;managing;the business.;(b);The trader has unlimited liability and runs the business in conjunction with;the providers of;loan;finance.;(c);The trader has unlimited liability and must have the business accounts audited.;(d);The trader has unlimited liability, takes sole responsibility for management of;the business and;no;audit is needed.;2.Which of the following statements best;describes the purpose of financial accounting in a limited;liability;company?;(a);To assist in the day-to-day management of the company.;(b);To enable the business to pay the correct amount of tax.;(c);To ensure that the business pays the correct dividend.;(d);To help the directors discharge their obligations to the shareholders.;Chapter;2;Accounting;rules;1.A business has prepared its accounts for a;financial year and these show a profit of ?500 000. The;accounts;do not include the following items;?;a likely loss on a contract of ?25 000;?;a possible Court ruling in favour of the;company which is likely to increase profits by ?10 000;?;a possible Court ruling against the;company which could result in damages of between ?5 000 to;?15;000.;Having;regard to the fundamental accounting concepts, which of the following revised;profit;figures;is correct when the above factors are taken in to account?;(a);?480 000.;(b);?460 000.;(c);?510 000.;(d);?475 000.;2.A company sells goods on credit valued at;?25 000 to a customer. At what point in the sales cycle;should;this sale be recognized in the accounts?;(a);When the customer?s order is received.;(b);When the goods are ready for dispatch to the customer.;(c);When the goods are sent, accepted and invoiced.;(d);When the customer pays.;Chapter;3;Recording;data;1.Exe Ltd sells goods on credit to Wy Ltd;for ?3000. Which of the following accounting entries correctly;records;this transaction?;(a);Debit sales, credit Wy Ltd ?3000.;(b);Debit Wy Ltd, credit sales ?3000.;(c);Debit cash, credit sales ?3000.;(d);Debit Wy Ltd, credit stock ?3000.;2.The following items relate to the bank;account of Exe Ltd: balance at 1 January 2001 = ?4500 (in;hand);total payments in 2001 were ?45 800, total receipts in 2001 were ?36 900, bank;charges not yet;entered;into the bank account were ?1200. What was the correct closing bank balance at;31;December 2001?;(a);?5600 overdrawn.;(b);?12 200 overdrawn.;(c);?4400 overdrawn.;(d);?13 400 overdrawn.;3.A business has the following transactions;recorded in its sales ledger for 2001;?000;Debtors;at 1 January 2001 25;Sales;in 2001 345;Receipts;from debtors 318;Credit;notes raised in 2001 23;Which;is the correct figure for debtors at 31 December 2001?;(a);?29 000.;(b);?27 000.;(c);?52 000.;(d);?75 000.;4.A business has the following transactions;recorded in its purchase ledger;?000;Creditors;at 1 January 2001 35;Purchases;during 2001 275;Creditors;at 31 December 2001 49;Debit;notes raised on suppliers 5;Which;is the correct figure for the total of payments to suppliers during 2001?;(a);?221 000.;(b);?256 000.;(c);?284 000.;(d);?289 000.;Accounting for Non-Accounting Students, 5th edition,Lecturer?s;Guide. ? Pearson Education Limited 200199;5.A business receives a cheque from a;customer for ?256 in full agreed settlement of an account which;showed;a debit balance of ?270. Which of the following entries correctly records this;transaction?;(a);Credit bank ?256, credit discount received ?14, debit debtor ?270.;(b);Debit bank ?256, debit discount received ?14, credit debtor ?270.;(c);Debit bank ?256, debit discount allowed ?14, credit debtor ?270.;(d);Debit bank ?256, debit discount allowed ?14, credit creditor ?270.;100;Accounting for Non-Accounting Students, 5th edition,Lecturer?s;Guide. ? Pearson Education Limited 2001;Chapter;4;Trading;entity accounts;1.Which of the following statements is;correct?;(a);Accounting profit is the difference between cash receipts and cash paid in a;period.;(b);Accounting profit is the total of cash sales in the year less the expenses for;the period.;(c);Accounting profit is the difference between revenue income and expenses for the;period.;(d);Accounting profit is the difference between revenue income and cash payments;for the period.;2.Which of the following statements is;correct in relation to a trial balance?;(a);It shows the financial position of a business.;(b);All the balances in the trial balance will be summarized on the business;balance sheet.;(c);It is a list of balances and forms the starting point for the preparation of;the business accounts.;(d);It is part of the published accounts of a business.;3.A business has the following items in its;trial balance;?000;Trade;debtors 25;Prepayments;10;Bank;overdraft 5;Trade;creditors 8;Fixed;assets 15;Closing;stock 8;Which;of the following is the correct figure for the working capital of the business?;(a);?42 000.;(b);?45 000.;(c);?50 000.;(d);?30 000.;4.A business has the following items;extracted from its trial balance;?000;Opening;stock 10;Purchases;25;Sales;40;Expenses;10;In;addition, its closing stock is valued at ?15 000.;What;is the correct figure for the business gross profit?;(a);?20 000.;(b);?10 000.;(c);?15 000.;(d);?nil.;Questions;5, 6 and 7 use the following summary balance sheet;?000 ?000;Fixed;assets 22 Capital 20;Stocks;10 Retained profit of year 5;Debtors;20 Creditors 10;Bank;5 Long-term loan 22;57;57;5.Which is the correct figure for the net;assets of the business?;(a);?12 000.;(b);?25 000.;(c);?47 000.;(d);?57 000.;6.Which is the correct figure for the;capital employed in the business?;(a);?20 000.;(b);?25 000.;(c);?47 000.;(d);?57 000.;7.Which of the following statements;regarding the retained profit of ?5000 for the year is correct?;(a);It is the net profit of the period.;(b);It is the net profit kept in the business after owner?s drawings.;(c);It is the amount of surplus cash in the business.;(d);It is the amount of profit the owner can take out of the business.;8.The following trial balance is incorrect;?000 ?000;Stock;10;Capital;15;Bank;overdraft 15;Trade;creditors 30;Fixed;assets 25;Trade;debtors 10;Cash;2;Trade;investments 13;Sales;100;Purchases;50;Operating;expenses 50;160;160;Which;of the following groups of items, if moved to the correct side of the trial balance;will correct;it?;(a);Capital, investments, cash, sales, purchases and operating expenses.;(b);Capital, cash, investments.;(c);Capital, bank overdraft.;(d);Sales, purchases, operating expenses.


Paper#44988 | Written in 18-Jul-2015

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