Exact2Pass
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:
The Framework is described as a conceptual framework when used in the creation of new accounting standards.
Which ONE of the following describes the approach of the Framework?
The sales ledger control account shows a balance of $267,984 whilst the individual customer account balances total $262,856.
Which of the following is a possible explanation for the difference between the two?
(i) A payment has been recorded in the cashbook but not in the sales ledger
(ii) A payment has been recorded in the sales ledger but not in the cashbook
(iii) An invoice has been recorded in the sales ledger but not in the sales day book
(iv) An invoice has been recorded in the sales day book but not in the sales ledger
A company's payables days has reduced from 60 days to 55 days.
Which of the following could be a possible explanation for this?
ABC produces accounts lo the year ended 31 December annually Extracts from the most recent financial statements are.
Calculate the average inventory days ratio for the year ended 31 December 20X4.
Give your answer to the nearest day
Refer to the Exhibit.
Double entry forms the basis of financial accounting records.
Which of the following combinations is correct?
Refer to the exhibit.
The following information is available for a company:
The company has declared an ordinary dividend of $0.05 per share.
What is the total dividend payment to be made by the company?
Which of the following is the best definition of the objective of accounting?
In accordance with IAS 7 Statements of Cash Flow, which TWO of the following are cash flows presented as investing activities?
Your company provides a number of staff with lap-top computers, as well as pocket calculators. It capitalizes the cost of the computers and depreciates them over several years, but writes off the cost of the pocket calculators in full, against profits, in the period in which they are purchased.
The main justification for this difference in treatment is:
Refer to the Exhibit.
Your organization uses the Weighted Average Cost method of valuing inventory.
During a particular month, the following inventory details were recorded:
The value of the inventory at the end of the month was
Refer to the exhibit.
Ronald has the following assets and liabilities at 31 December:
The capital balance at 31 December was
Which one of the following statements best describes the usefulness of the income statement account of a company:
An audit trail is an essential part of an efficient, complete accounting system
Why is an audit trail important?
Refer to the Exhibit.
The following information is available for a company for the period:
The value of sales invoices for the period was:
At the beginning of the year, a club's Membership Subscriptions account showed a debit balance of $500 and a credit balance of $225. During the following year, subscriptions received amounted to $12000.
At the end of the year, subscriptions paid in advance amounted to $200, and subscriptions in arrears, and expected to be collected, amounted to $150.
The amount to be transferred to the income and expenditure account for the year is
Refer to the Exhibit.
From the following information, calculate the value of sales for the period:
Value of sales is
An organization's trial balance at the end of the month was out of agreement, with the debit side totaling £500 less than the credit side. A suspense account was opened for this amount.
During the next month, the following errors were discovered:
(a) The purchase returns day book had been under cast by £50
(b) Rent payable of £400 had been credited to the rent receivable account
(c) A non-current asset, with a net book value of £700 had been disposed of at a loss of £80; all entries had been correctly recorded except that the sale proceeds had been omitted from the disposals account.
Following the correction of these errors, the balance on the suspense account would be.
Fraud can be conducted by employees or management. Management fraud can be hard to detect and may not seem like fraud at all as often company performance improves.
Which ONE of the following would be an example of management fraud?
Which of the following best explains what is meant by "capital expenditure"?
Which of the following transactions in the current year explains a reason for an increase in the gearing ratio of an entity from 35% last year to 45% this year?
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?
The profit earned by Subramanian in 2006 was £ 50,000. He injected new capital of £12,000 during the year and withdrew goods for his private use that cost £4,000.
If net assets at the beginning of 2006 were £10,000, what were the closing net assets?
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:
In a cash flow statement, which one of the following would not be found under the section "cash flows from operating activities"?
Company X is a private limited oil company. Which of the following are relevant for Company X's integrated report?
Refer to the exhibit.
A company has the following debt in the statement of financial position
The finance cost to be charged to the income statement is
The phrase 'net book value', when applied to the statement of financial position figure for non-current assets, indicates that the figure represents:
Below is some information about Company TYY:
TYY offers a wholesale price for Product P of £650 per 100 quantity.
TYY offers regular customers a 35% trade discount.
On every 15th of the month, TYY offers a 15% cash discount on sales.
MPU wants to make a purchase from TTY for the first time, of900 Product Ps on the 15th of June. How much will MPU pay for this purchase?
DEF prepares its financial statements to 30 September each year On 1 March 20X5 DEF acquires an office and immediately rents it to a tenant charging $2,400 a quarter payable in advance.
The tenant pays $2,400 on each of the following days 1 March 20X5, 6 June 20X5, 4 September 20X5 and 1 December 20X5.
What is the liability reported in the statement of financial position relating to the rent at 30 September 20X5?
Which of the following are possible reason for a credit balance on the sales ledger account of a customer?
(a) A contra entry between the sales ledger and the purchase ledger has been carried out for an amount in excess of the sales ledger balance
(b) A customer has returned goods subsequent to making payment for them
(c) A credit note has been issued in error
(d) A bad debt written off has subsequently been paid
Which of the following would require an adjustment to be made to the cash book?
(a) Unpresented cheques
(b) Receipts not yet credited by the bank
(c) A dishonoured cheque
(d) Bank charges
Refer to the Exhibit.
Which of the following balances normally result from the double-entry system of book-keeping?
The answer is:
Comany D recently purchased an intangible asset from CompanyJFY, which was priced at £150,500, which Company D paid, along a goodwill amount that totalled 25% of the asking price.
Company D has estimated that the purchased entity will have a useful life of 35 years. Company D has decided to amortise the cost of the new asset using the straight line method.
What will the amortisation figure per annum be for Company D's new entity?
Refer to the exhibit.
A business has the following trading account for its most recent year:
What is its rate of inventory turnover for the year?
In a statement of cash flows, which one of the following would not be found under the section "cash flows from investing activities"?
DE has the following incomplete non-current register extract at 301 at December 20X7:
What is the useful economic life (UEL) (in years) of this asset which should be entered into the non-current asset register?
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%.
Which THREE of the following statements are true?
A business has come to you for advice. There are about to start trading and want to ensure that they keep appropriate accounting records that will grow with their business, save time and produce useful information. They have already established books of prime entry.
Which of the following would you also suggest they use?
Different users have different needs from financial information. One of which is to know about the company's ability pay its debts
Which of the following users will have this need for information?
Company A has a receivables turnover ratio of six times, while Company B, which operates in the same market sector, has a receivables turnover ratio of five times.
This suggests that
If the royalty cost falls on items used in the manufacturing process, which TWO of the following would be true?
A company uses the reduced balance method of depreciation for its company vehicles. The vehicles are depreciated at a rate of 30% per annum.
On 31 March 2003 the company purchased a number of vehicles with a total cost of $200,000. The company's year-end is 31 December and it is company policy to charge a full year's depreciation in the year of acquisition.
The carrying value of the vehicles at 31 December 2006 will be
Refer to the Exhibit.
A company is preparing its accounts to 30 April 2006. The latest telephone bill received by the company was dated 31 March and included call charges for the quarter 1 December to 28 February. The amount of the bill for call charges (excluding VAT) was $960. Most of the company's telephone bills are for similar amounts.
Which of the following journal entries should be made to the company's accounts at 30 April 2006?
The journal entries which should be made to the company's accounts at 30 April 2006 is
At 1 June 20X9 XY has opening inventory of 80 units at a cost of $7.60 each XY purchases the following units during the month of June:
During June 20X9, XY sold 250 units at a price of $15.00 each XY uses the first in. first out (FIFO) method of inventory valuation What is the value of XYs closing inventory at 30 June 20X9? Give your answer to the nearest $.
