Accounting Multiple Choice Question – 31 May 2021

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

apple devices books business coffee
Photo by Serpstat on Pexels.com

A fixed asset is purchased on 1 April 2018 at a cost of £240,000.

It has an estimated residual value of £40,000 at the end of its 5 year life and is to be depreciated on the reducing balance basis at the rate of 30 % each year.

What is the depreciation charge for the year ending 31 March 2020 (to the nearest £)?

Select ONE answer:

  1. £42,000
  2. £50,400
  3. £98,000
  4. £11,7600

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 ==> £240,000 * 0.3 = £72,000 ==> £168,000 * 0.3 = £50,400
  3. Not correct
  4. Not correct

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

Accounting Multiple Choice Question – 30 May 2021

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

apple devices books business coffee
Photo by Serpstat on Pexels.com

At the end of a financial period, a business has the following balances.

What should the business do if it wishes to maintain the bad debt provision at 5 % of debtors?

Select ONE answer:

  1. decrease the existing provision by £58
  2. increase the existing provision by £58
  3. decrease the existing provision by £71 
  4. increase the existing provision by £71 

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 ==> £10,620 – £260 = £10,360 * 0.05 = £518 – £460 ==> Increase £58
  3. Not correct
  4. Not correct

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

Accounting Multiple Choice Question – 29 May 2021

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

apple devices books business coffee
Photo by Serpstat on Pexels.com

An item of capital expenditure has been incorrectly treated as revenue expenditure in the accounts of a business.

What is the effect of this error on the accounts of the business? 

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 4

  1. Not correct
  2. Not correct
  3. Not correct
  4. Correct 

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

Accounting Multiple Choice Question – 28 May 2021

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

apple devices books business coffee
Photo by Serpstat on Pexels.com

A business buys a computer for £2,200 on 1 January 2019.

The computer will be used for four years, after which time it will be sold for £280. The business uses the straight-line method of depreciation. 


What is the depreciation charge for the year ended 31 December 2020?

Select ONE answer:

  1. £480
  2. £550
  3. £960
  4. £1,100

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 1

  1. Correct ==> (£2,200 / 4) – £280 = £480 p.a.
  2. Not correct
  3. Not correct
  4. Not correct

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

Accounting Multiple Choice Question – 27 May 2021

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

apple devices books business coffee
Photo by Serpstat on Pexels.com

An item of capital expenditure has been incorrectly treated as revenue expenditure in the accounts of a business.


What is the effect of this error on the accounts of the business? 

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 4

  1. Not correct
  2. Not correct
  3. Not correct
  4. Correct 

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