Accounting Multiple Choice Question – 15 May 2022

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

apple devices books business coffee
Photo by Serpstat on Pexels.com

The financial statements of a company include the following:

  • profit for the year – £245,000
  • finance costs – £120,000
  • preference share capital – £220,000
  • ordinary share capital – £850,000
  • general reserves – £140,000
  • retained earnings – £260,000

What is the return on capital employed (ROCE)?

Select ONE answer:

  1. 16.67%
  2. 22.90%
  3. 24.83%
  4. 34.11%

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 ==> (245 + 120) / (220 + 850 + 140 + 260)
  4. Not correct

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

Accounting Multiple Choice Question – 14 May 2022

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

apple devices books business coffee
Photo by Serpstat on Pexels.com

Which ratio calculates the average time a business takes to pay its credit suppliers?

Select ONE answer:

  1. current ratio
  2. liquid (acid test) ratio
  3. trade payables days
  4. trade receivables 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
  4. Not correct

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

Accounting Multiple Choice Question – 13 May 2022

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

apple devices books business coffee
Photo by Serpstat on Pexels.com

A company issues 500 000 £1 ordinary shares for £3 each and £250 000 debentures of 6%.

By which amount will the net assets of the company increase?

Select ONE answer:

  1. £750,000
  2. £1,250,000
  3. £1,500,000
  4. £1,750,000

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 – Dr Cash £1,750k Cr Share Capital £1,500 Cr LT Liability £250k
  4. Not correct

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

Accounting Multiple Choice Question – 12 May 2022

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

apple devices books business coffee
Photo by Serpstat on Pexels.com

An extract from a company’s statement of financial position showed the following information.

  • issued capital: 2 million ordinary shares of £0.50 each – £1,000,000
  • share premium – £600,000
  • retained earnings – £2,400,000

The directors have agreed to make a bonus issue of 3 ordinary shares for 4 shares held. They wish to maintain reserves in their most flexible (distributable) form.

Which debit entry should be made in the retained earnings account?

Select ONE answer:

  1. £150,000
  2. £750,000
  3. £900,000
  4. £1,500,000

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 1

  1. Correct ==> 2,000,000 shares * ¾ = 1,500,000 new shares or £750k  £600K from share premium & balance of £150k from retained earnings.
  2. Not correct
  3. Not correct
  4. Not correct

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

Accounting Multiple Choice Question – 11 May 2022

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

apple devices books business coffee
Photo by Serpstat on Pexels.com

A company issued £1 ordinary shares for £1.20 each. The total proceeds were recorded in the ordinary share capital account.

Which journal entry completes the entries for the share issue?

Select ONE answer:

  1. debit – suspense / credit – ordinary share capital
  2. debit – ordinary share capital / credit – suspense
  3. debit – ordinary share capital / credit – share premium
  4. debit – share premium / credit – ordinary share capital

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

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

%d bloggers like this: