Day: June 17, 2023

Accounting Multiple Choice Question – 17 June 2023

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

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Alex plc issues 1M ordinary shares of £1 each for £3 each and £500k 6 % debentures.

By what amount will the net assets of Alex plc increase as a result of these transactions?

Select ONE answer:

  1. No increase
  2. £2.5M
  3. £3.0M
  4. £3.5M

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 – Dr Cash £3M + £0.5M Cr NCL £0.5M SC £3M = = > A – L = C = £3.5M – £0.5M = £3M
  4. Not correct

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