Tag: Bookkeeping

Accounting Multiple Choice Question – 4 July 2023

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

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Alex Ltd purchases the net assets of the Lucy & Michelle partnership for a cash payment of £1.2M
The agreed values for their partnership at the date of acquisition were as follows:

  • Non-Current Assets – £2M
  • Current Assets – £0.6M
  • Current Liabilities – £0.4M
  • Non-current liabilities – £0.8M
  • Capital accounts (credit) – £1.7M
  • Current accounts (debit) – £0.3M

What is the figure for goodwill?

Select ONE answer:

  1. £0.2M negative
  2. £0.2M positive
  3. £0.8M negative
  4. £0.8M positive

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 – £2M + £0.6M – £0.4M – £0.8M = £1.4M – £1.2M = £0.2M negative
  2. Not correct
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 3 July 2023

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

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X and Y are in partnership, sharing profits equally.

They agree to admit Z as an equal partner.

Z is to introduce capital into of the partnership worth £100,000.

The partnership goodwill is £60,000 and all adjustments are to be made in the capital accounts.

Which shows the correct situation after the admission of Z to the three partners’ capital accounts?

Select ONE answer:

  1. X a credit of £10k and Y a credit of £10k and Z a credit of £80k
  2. X a credit of £10k and Y a credit of £10k and Z a debit of £20k
  3. X a credit of £30k and Y a credit of £30k and Z a debit of £60k
  4. X a debit of £30k and Y a debit of £30k and Z a credit of £160k

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 – Step 1 – Dr Goodwill £60k Cr X Capital Account £30k and Y Capital Account £30k. Step 2 – Dr Cash £100k Cr Z Capital Account £100k. Step 3 (Goodwill w/o) Dr X Capital Account £20k Dr Y Capital Account £20k Dr Z Capital Account Cr Goodwill £60k
  2. Not correct
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 2 July 2023

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

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The amount shown on the cash flow statement of Alex plc for 2022 as taxation paid amounts to £96,000.

The extract of the Income Statement for Alex plc for 2022 and 2021 is as follows:

  • operating profit for the year – 2022 £350k and 2021 £336k
  • provision for taxation – 2022 (£110k) and 2021 (£104k)
  • profit after taxation – 2022 £240k and 2021 £232k

The liability for taxation at the 2021 year end was £100k.

What is the total tax provision disclosed in the statement of financial position of Alex plc for 2022?

Select ONE answer:

  1. £14,000
  2. £110,000
  3. £114,000
  4. £210,000

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 – £100k + £110k – £96k = = > £114k
  4. Not correct

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Accounting Multiple Choice Question – 1 July 2023

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

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In a cash flow statement, which item is a cash outflow?

Select ONE answer:

  1. a decrease in stock
  2. a decrease in trade debtors
  3. a decrease in trade creditors
  4. an issue of bonus shares

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

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Accounting Multiple Choice Question – 30 June 2023

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

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The table shows figures for a week’s production of The Milford.

  • expected production – 10,000 units
  • expected production overhead – £50,000
  • actual production overhead – £60,000
  • under-absorption of overhead – £5,000

What is the actual amount of production in the week of The Milford?

Select ONE answer:

  1. 9,000 units
  2. 9,167 units
  3. 11,000 units
  4. 13,000 units

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 – £50,000 / 10,000 = £5 per unit = = > Actual production overhead £60,000 means a difference of £10,000 but and under-absorption of £5,000. Therefore £5,000 difference / £5 = 1,000 extra units of actual production.
  4. Not correct

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