Category: Accounting

The table below gives data about rental income for the year ended 31 March 2020. 

Which figure for rental income will appear in the Profit and Loss Account for the year ended 31 March 2020? 

Select ONE answer:

1. £14,010
2. £14,210
3. £14,310
4. £14,510

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 = £13,700 + £560 – £1,400 + £1,300 + £1,750 – £1,600
4. Not correct

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A company manufactures a single product as shown. 

• selling price £20 per unit
• variable costs £15 per unit 

Its budgeted fixed costs are £200,000.

How many units must the company sell to make a net profit of £50,000? 

Select ONE answer:

1. 10 000 units
2. 30 000 units
3. 40 000 units
4. 50 000 units 

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. Not correct
4. Correct – CM = £20 – £15 = £5 ==> £200,000 / £5 = 40,000 units ==> £50,000 Profit / CM £5 = 10,000 units TOTAL 50,000 units

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A company considers buying a new machine costing £60,000. The machine will have a life of four years. It will then have a scrap value of £10,000.

The company has a straight line depreciation policy. The table shows the forecast net receipts arising from the purchase of the machine. 

How long will it take the company to ‘pay back’ its investment? 

Select ONE answer:

1. 1 year, 197 days
2. 1 year, 309 days
3. 2 years, 182 days
4. 3 years

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 – £60k – Y1 £20k – Y2 £20k – Y3 £20k

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

The net present value (NPV) method of investment appraisal requires?

Select ONE answer:

1. a distinction being made between capital and revenue expenditure and income.
2. the realistic depreciation of the capital expenditure involved.
3. a knowledge of the amounts and timings of the expected net proceeds of proposed investments.
4. the calculation of the payback periods of proposed investments.

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.

The table below shows the standard cost data relating to a product passing through two production departments. 

The standard prime cost is £20. Overheads are absorbed on the basis of direct labour hours and machine hours as appropriate.

What is the standard factory cost of the product?

Select ONE answer:

1. £26
2. £32
3. £34
4. £36

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 – £20 + (£200,000 / 100,000 * 2) + (£400,000 / 100,000 * 3)

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