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Which accounting ratio is used to assess working capital management?

Select ONE answer:

1. gross profit ratio
2. net profit ratio
3. return on capital employed
4. stock turnover ratio

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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A building cost £340 000 several years ago.

At 30 June 2004 the accumulated depreciation on the building was£47 600 and it was decided to revalue the building to its market value of £560 000.

What will be the balance on the Revaluation Reserve?

Select ONE answer:

1. £172 400
2. £220 000
3. £267 600
4. £512 400

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 ==> £560,000 – £340,000 = £220,000 + £47,600
4. Not correct

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What appears as a credit in the Appropriation Account of a partnership?

Select ONE answer:

1. Goodwill
2. interest on capital
3. net trading profit
4. partnership salaries

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.

A company excludes from its Balance Sheet machinery for which spare parts are no longer obtainable.

Which concept is being applied by the company?

Select ONE answer:

1. going concern
2. materiality
3. prudence
4. substance over form

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.

A manufacturer has paid £3,000 for electricity from his private bank account.

The electricity charges are apportioned as follows:

• factory – 50%
• sales office – 10%
• private – 40%

Which entries for electricity are necessary in the business accounts?

Select ONE answer:

1. factory credit £1,000 / sales office credit £200 / capital account debit £1,200
2. factory credit £1,500 / sales office credit £300 / capital account debit £1,800
3. factory debit £1,000 / sales office debit £200 / capital account credit £1,200
4. factory debit £1,500 / sales office debit £300 / capital account credit £1,800

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 – £3,000 * 0.5 = £1,800; £3,000 * 0.1 = £300 ==> Dr Electricity £1,800 Cr Capital £1,800

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