Accounting Multiple Choice Question – 6 May 2020

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Accounting
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Shareholders’ funds in a company equals . . .?

Select ONE answer:

  1. the total of share capital, reserves and long-term debts of the company.
  2. the total of share capital and revenue reserves of the company.
  3. the total of issued share capital and reserves of the company.
  4. the total of share capital and capital reserves of the company.

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

  1. Not correct
  2. Not correct
  3. Correct – The term ‘shareholders‘ funds’ means all of the money ‘owed’ by the company to its shareholders. This is the total of all money invested in the company by the shareholders (share capital) and all profits earned by the company (these profits are ‘owned‘ by the company, which in turn is owned by its shareholders) which is the total of the balance on the profit and loss account (profits retained) and the balance on all other reserve accounts (amounts debited in the profit and loss appropriation account and transferred into the balance sheet).
  4. Not correct

 

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Author: stuart001uk2014

Referral marketing, business, economics and accounting s​pecialist & corporate mentor

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