The Multiple Choice Questions Blog

A trial balance shows:

        Dr accounts receivable £28,000

                        Cr provision for doubtful debts £1,200

£2,100 of the outstanding invoices are irrecoverable and are to be written off.

The owner of the business wishes to make the provision for doubtful debts equal to 5 % of his outstanding customer invoices.

What is the amount debited to the income statement for the provision for doubtful debts?

Select ONE answer:

1. £95
2. £1,295
3. £1,400
4. £2,600

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 – £28,000 – £2,100 * 0.05 = £1,295 – £1,200 == > £95 increase
2. Not correct
3. Not correct
4. Not correct

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A customer paid a deposit in advance for goods to be supplied at a later date.

How should this be recorded in the seller’s books?

Select ONE answer:

1. debit cash / credit customer
2. debit cash / credit sales
3. debit customer / credit prepayment
4. debit customer / credit sales

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. Not correct
3. Not correct
4. Not correct

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

Which item is revenue expenditure?

Select ONE answer:

1. cost of painting new office premises during construction
2. cost of repairs to factory plant and machinery
3. legal fees for the purchase of new factory premises
4. wages of a company’s own workmen for building an office extension

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 2

1. Not correct
2. Correct
3. Not correct
4. Not correct

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

What is an advantage of using the pay back method of capital investment appraisal?

Select ONE answer:

1. calculates hire purchase instalments
2. calculates profitability
3. determines the efficiency of a process
4. evaluates risk

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

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