Month: February 2021

A company’s debtors total £27,000. There is a collection period of 30 days.

The budget for the coming year provides for an increased turnover of 50% with the relevant collection period being increased to 60 days.

What will the year-end debtors be?

Select ONE answer:

1. £13,500
2. £27,000
3. £40,500
4. £81,000

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 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – £27,000 * 2 * 2

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The table below shows the budget for a business.

Actual production and sales were 15 000 units.

What was the actual profit?

Select ONE answer:

1. £30,000
2. £40,000
3. £52,000
4. £90,000 

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 2

1. Not correct
2. Correct – (£400,000 / 20,000) *15,000 — (£280,000 / 20,000) * 15,000 – £50,000
3. Not correct
4. Not correct

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A company has a policy of holding stock equal to next month’s expected sales plus 10%.

The information below shows the budgeted sales for the next three months.

• Aug   —  300 units
• Sept  —  270 units
• Oct   —  360 units

What must be the company’s production in September, in order to achieve its objectives?

Select ONE answer:

1. 267
2. 333
3. 369
4. 396

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 = – (270 *0.1) + 360 + (360 * 0.1)
4. Not correct

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A company manufactures three products for which the following details (per unit) are available. 

product X £   product Y £   product Z £

sales value                                 12                    12                 22.50

direct material cost                  5                    5                   8      

labour cost                                   4                    6                  4.50

labour hours                                2                    0.8                3

If labour hours are restricted in supply, which order of priority should the company adopt when planning its production?

Select ONE answer:

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 – Z = 22.50 – 12.50 = 10 CM,  Y = 12 – 10 = 2 CM
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

A company has decided to redeem its preference shares at a premium of £0.25. The preference shares were originally issued at £1.15 each.

Prior to the redemption the company’s Balance Sheet showed the following.

• Ordinary shares of £1  —  £1,000k
• 8% redeemable preference shares of £1  —  £600k
• Share premium  —  £100k
• Retained profit  —  £750k

How will the reserves appear in the Balance Sheet after the preference shares have been redeemed? 

Select ONE answer:

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
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.