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Materials and labour are in plentiful supply and the following budgets are prepared.

1. cash
2. purchases
3. sales
4. overhead

In which order should the budgets be prepared?

Select ONE answer:

1. 1, 2, 3 and 4
2. 2, 4, 1 and 3
3. 3, 2, 4 and 1
4. 4, 3, 2 and 1

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.

At the beginning of a given period the value of work-in-progress was £11,000.

The unit costs of production for the period were:

• direct materials – £5.00
• direct labour – £8.50

At the end of the period work-in-progress consisted of 700 units which were complete as to 80% of materials and 50% labour.

What was the change in the value of the work-in-progress during the period?

Select ONE answer:

1. Decrease – £1,550
2. Increase – £1,550
3. Decrease – £5,225
4. Increase – £5,225

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 = = > £11,000 – (£5 * 0.8 * 700) – (£8.5 * 0.5 * 700)
4. Not correct

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

Below shows information from the Balance Sheets of two companies, X and Y.

• Ordinary Shares – Company X – £800k & Company Y – £900k
• 10% Debentures – Company X – £600k & Company Y – £150k
• Profit and Loss Account – Company X – £300k & Company Y – £650k

Which providers of finance would experience the greatest degree of risk in times of falling profits?

Select ONE answer:

1. debenture holders of company X
2. debenture holders of company Y
3. ordinary shareholders of company X
4. ordinary shareholders of company Y

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.

Companies are required to include a statement of total recognised gains and losses within their published financial accounts.

Below is information extracted from the financial statements of a company for the year ended 31 March 2015.

• premium received on the issue of shares – £150k
• profit on ordinary activities after taxation – £600k
• unrealised surplus on the revaluation of property – £280k

What should the company show as the net gain for the year?

Select ONE answer:

1. £730k
2. £750k
3. £880k
4. £1,030k

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 = £600k + £280k
4. Not correct

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

A company’s year end is 30 June 2015.

The following events took place after the year-end:

• On 27 July 2015 a major fire took place at the company’s factory.
• On 8 August 2015 a major trade receivable at 30 June 2015 went into liquidation.

In accordance with SSAP 17, Accounting for post balance sheet events, how should the two events be treated in the financial statements?

Select ONE answer:

1. fire – accrued in accounts & trade receivable liquidation – accrued in accounts
2. fire – accrued in accounts & trade receivable liquidation – disclosed in notes
3. fire – disclosed in notes & trade receivable liquidation – accrued in accounts
4. fire – disclosed in notes & trade receivable liquidation – disclosed in notes

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.