Multiple choice questions for Accounting for Non-Accountants 10 th edition

Transcription

1 Accounting for Non-Accountants 10th Online Material 1 Multiple choice questions for Accounting for Non-Accountants 10 th edition Set 3 20 questions 1 At the start of the year, the balance on Kieran s capital account was 52,421. During the year Kieran made drawings of 11,201 and the net profit for the year was 9,901. What is the balance on Kieran s capital account at the end of the year? A 53,721 B 51,121 C 62,322 D 41,220 2 At the start of the year, the balance on Haydn s capital account was 22,000. At the end of the year, the balance on his capital account was 30,000. During the year he introduced a car valued at 10,000 into the business and he also took 100 drawings each week for the full year. What is the value of Haydn s profit earned during the year? A 12,800 B 18,000 C 3,200 D 8,000 3 A debit entry into a ledger account represents which of the following? A An increase in revenue B A decrease in cash C An decrease in capital D An increase in a liability 4 Which of the following is an example of revenue expenditure? A Staff wages B Architect fees associate with design of new premises C Carriage inwards on new non-current assets D Installation costs on non-current assets

2 2 Accounting for Non-Accountants 10th Online Material 5 Alec sells good on credit to Isobel for a price of 400. Alec offers Isobel a 10% trade discount and a cash discount of 2.5% if Isobel pays within 28 days. What is the amount that Alex will credit to his sales account? A 400 B 360 C 351 D The correct double-entry required to record the settlement of an outstanding amount owing for goods purchased where the firm qualifies for a prompt payment discount would be: A Dr Trade payables Cr Bank Cr Discounts received B Dr Trade payables Dr Discounts received Cr Bank C Dr Bank Cr Trade payables Cr Discounts received D Dr Trade payables Dr Discounts received Cr Bank 7 Cameron sells 20 units of inventory at a price of 20 per unit to Callum. Cameron offers Callum a 5% trade discounts and a 5% settlement discount if Callum pays within 14 days. What will be the total of the invoice that Cameron issues to Callum for this transaction? A 400 B 380 C 360 D Examine the following relating to a job: Standard hours worked 112 Actual hours worked 130 Standard wage rate 5.40 Actual wage rate.4.95 The wage rate variance for this job is: A (adverse) B (favourable) C (adverse) D (favourable)

3 Accounting for Non-Accountants 10th Online Material 3 9 The following ledger balance make up a company s trial balance: Sales 118,000 Purchases 92,551 Carriage inwards 908 Carriage outwards 1,231 Sales returns 99 Purchases returns 103 What is the total of the debit column of the trial balance? A 94,789 B 93,558 C 94,793 D 118, Tim has not kept accurate accounting records during the financial year. A stocktake conducted one year ago gave the value for opening inventory of 7,200. During the most recent year, Tim purchased goods for resale at a value of 20,000 and at the year-end he had inventory valued at 9,600. All Tim s sales are made at a mark-up of 20%. What was Tim s gross profit for the year? A 21,120 B 3,520 C 17,600 D 4, On 1 January 2022 L Riches owed D Stokes 600. On 11 November 2022 Howard was declared bankrupt and a payment of 25p in the was to be received in full settlement with the remainder written off as a bad debt. The entry to record the debt being written off in the books of Haynes would be: Debit Credit A Bank 150 Income statement 150 B L Riches 450 Bad debts 450 C Bad debts 450 L Riches 450 D Income statement 150 Bank 150

4 4 Accounting for Non-Accountants 10th Online Material 12 A payment made to a payables account for 54 cash was entered in both accounts as 45. The entry needed to correct this in the ledger accounts would be: A Debit: Payables 9 Credit: Cashbook 9 B Debit: Cashbook 9 Credit: Payables 9 C Debit: Payables 9 Credit: Suspense 9 D Debit: Suspense 9 Credit: Payables 9 13 The correct entry needed to record the withdrawal of cash from the business for the owner s personal sue would be: A Debit: Capital Credit: Cash B Debit: Capital Credit: Drawings C Debit: Drawings Credit: Cash D Debit: Cash Credit: Drawings 14 An investment costs 60,000 and is expected to last for 5 years. If the total profit of the project is expected to be 35,000, then the ARR would be which of the following: A 11.7% B 58.3% C 8.3% D 1.17% 15 Which of the following errors would be found by a trial balance? 1. Only entering half of the transaction. 2. Entering two debits for a transaction. 3. Entering different amounts for the credit half of the transaction compared with the debit half. A 1 only B 2 only C 1 and 2 D All of them 16 If annual consumption is 9,000 units, the cost of reordering is 120 and the storage and holding cost per unit is 1.50 then the economic order quantity would be: A 600 units B 849 units C 1,200 units D 765 units

5 Accounting for Non-Accountants 10th Online Material 5 17 Given the following data, calculate the value of the firm s capital. Non-current assets 6,000, Inventory 350, Trade receivables 180, Cash at bank, 650 and Trade payables 280. A 7,000 B 7,180 C 7,460 D 6, Which of the following would not be classified as an asset? A Property owned B Money owed to us by customers C Money owed by us to a supplier D Money held in cash till 19 The correct double entry to record the return of goods by us to suppliers is: Debit Credit A Trade payables account Purchases B Trade payables account Returns inwards C Bank Returns outwards D Trade payables account Returns outwards 20 Which of the following statement is not true? A Profit adds to capital B Paying for assets with cash leaves total assets unchanged in overall value C Drawings reduces capital D An increase in liabilities leaves capital and assets both unchanged.