Day: October 11, 2023

Accounting Multiple Choice Question – 11 October 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 Trading plc, with an existing issued share capital of 200,000 shares of £0.50 made a one for four bonus issue.

This was later followed by a one for two rights issue at £1.20 per share.

What will be the balance on the share capital account after these transactions?

Select ONE answer:

  1. £125,000
  2. £187,500
  3. £270,000
  4. £375,000

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 == > 200,000 * £0.5 = £100k + (200,000 / 4 * £0.50) = £125k * 1.5 = £187,500
  3. Not correct
  4. Not correct

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