Accounting Multiple Choice Question – 19 May 2020

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

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Which of the following cannot normally be determined from the financial statements of a public limited company whose shares are quoted on the Stock Exchange?

Select ONE answer:

  1. The nominal (par) value of the issued ordinary share capital of the company.
  2. The book value of the company’s fixed assets.
  3. The current market value of the issued ordinary share capital of the company.
  4. None of the above.

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 – The nominal (par) value of the issued ordinary share capital of the company is shown in the capital and reserves section of the balance sheet.
  2. Not correct – The (net) book value of the company’s fixed assets is shown in the fixed assets section of the balance sheet.
  3. Correct – The market value of ordinary shares can change on a daily basis. Therefore, even if the market value at the end of the year was shown in the financial statements when they are being printed, this figure would be out of date by the time the financial statements were published. Therefore, while a market value could be shown in the financial statements, it cannot be the current market value.
  4. Not correct

 

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Accounting Multiple Choice Question – 18 May 2020

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

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Which of the following should be shown in the profit and loss appropriation account of a limited company?

Select ONE answer:

  1. Debenture interest paid during the current accounting period, in respect of the same period.
  2. Dividends paid during the current accounting period. in respect of the same period.
  3. Directors’ remuneration paid during the current accounting period, in respect of the same period.
  4. None of the above.

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 – Debenture interest paid during the current accounting period, in respect of the same period is an expense. and, just like any other expense, is charged as an expense in the profit and loss account (in accordance with the accruals concept) not the profit and loss appropriation account.
  2. Correct
  3. Not correct – Remuneration paid to directors, during the current accounting period, in respect of the same period is an expense, and, just like any other expense, is charged as an expense in the profit and loss account (in accordance with the accruals concept) not the profit and loss appropriation account.
  4. Not correct

 

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Accounting Multiple Choice Question – 17 May 2020

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

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In the accounts of a limited company. debenture interest paid during the current accounting period, in respect of the same period . . .?

Select ONE answer:

  1. is part of the company’s cost of sales.
  2. is an expense.
  3. is an appropriation of profit.
  4. None of the above.

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 – Debenture interest paid during the current accounting period, in respect of the same period is an expense, and. just like any other expense, is charged as an expense in the profit and loss account (in accordance with the accruals concept).
  3. Not correct
  4. Not correct

 

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Accounting Multiple Choice Question – 16 May 2020

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

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In the accounts of a limited company, the balance on a provision for depreciation account . . . ?

Select ONE answer:

  1. is shown under the heading ‘current liabilities’.
  2. is shown under the heading ‘capital and reserves’.
  3. is shown as an appropriation of profit.
  4. is deducted from the cost or valuation of the related fixed assets.

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 – Fixed assets are shown in the balance sheet at their net book value i.e. their cost or valuation less the cumulative provision for depreciation on them.

 

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Accounting Multiple Choice Question – 15 May 2020

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

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In the accounts of a limited company, remuneration paid to directors, during the current accounting period, in respect of the same period . . .?

Select ONE answer:

  1. is shown as an appropriation of profit.
  2. is shown as part of the company’s cost of sales.
  3. is shown as an expense in the profit and loss account.
  4. None of the above.

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 – Remuneration paid to directors , during the current accounting period, in respect of the same period is an expense, and, just like any other expense, is charged as an expense in the profit and loss account (in accordance with the accruals concept).
  4. Not correct

 

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Accounting Multiple Choice Question – 14 May 2020

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

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Which of the following is NOT normally found in the capital and reserves section of a company’s balance sheet?

Select ONE answer:

  1. Share premium account
  2. Profit and loss account balance
  3. Dividends payable
  4. 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 – Dividends payable are a current liability.
  4. Not correct

 

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Accounting Multiple Choice Question – 13 May 2020

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

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In the balance sheet of a limited company, the profit and loss account balance is shown under the heading. . .?

Select ONE answer:

  1. current liabilities
  2. fixed assets
  3. current assets
  4. capital and reserves

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 – Current liabilities are liabilities which are due to be discharged within one year.
  2. Not correct – Fixed assets are assets which have an expected useful economic life of more than one year and were purchased in order to be used on a continuing basis rather than solely for resale.
  3. Not correct – Current assets are cash and positive bank balances and other assets likely to be converted into cash or bank balances within a year as a result of normal trading operations.
  4. Correct – The company is being financed, in part, by the amount of its retained profit.

 

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