Accounting Multiple Choice Question – 15 November 2023

A transport business owned by Alex, the sole proprietor, purchased a motor vehicle.

This was charged to the Motor Expenses account. 

What are the effects of this on the end-of-year statement of financial position?

Select ONE answer:

1. Non-current assets understated & current assets understated
2. Non-current assets overstated & current assets overstated
3. Non-current assets overstated & capital account overstated
4. Non-current assets understated & capital account understated

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

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