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What is a variable production cost for a manufacturer?

Select ONE answer:

1. depreciation of equipment
2. factory business rates
3. purchases of raw materials
4. storekeepers’ wages

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.

During the year ended 31 March 2016, Alex plc made sales of £560,000 of which 25% were for cash.

The trade receivables at 31 March 2015 were £52,000 and at 31 March 2016 they were £56,000.

What is the Trade Receivables Days collection period based on the average receivables of the two year-ends?

Select ONE answer:

1. 34 days
2. 35 days
3. 47 days
4. 49 days

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 = = > (52 + 56) / 2) = £54k average debtors / (£560k * 75%) * 365 days
4. Not correct

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

Which statement is correct?

Select ONE answer:

1. A bonus issue of shares will increase the amount of cash available to the company.
2. A rights issue of shares is always made at the nominal value of the shares.
3. A rights issue of shares will increase the amount of cash available to the company.
4. If shares are issued at an amount that is more than the nominal value of the shares, the excess must be debited to the share premium account.

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 director-owned company needs additional funds.

Which method of finance might lead to a reduction of the director’s control of the business?

Select ONE answer:

1. bank loan
2. debenture
3. ordinary share issue
4. preference share issue

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 balance on a sales ledger control account is £40,000.

The following items are then discovered:

• total of sales day book understated – £500
• discounts allowed not entered in sales ledger control account – £1,200
• bad debts written off not recorded in sales ledger control account – £400
• provision for doubtful debts – £2,500

What is the total of the balances in the sales ledger?

Select ONE answer:

1. £37,900
2. £38,600
3. £38,900
4. £41,100

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 = £40,000 – £1,200 – £400 + £500
4. Not correct

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