Tag: Capital

Which of the following accounting treatments derive from the accounting concept of accruals / matching?

(1) Write down of a non-current asset which has suffered a fall in value
(2) Opening and closing inventory adjustments
(3) Capitalisation and amortisation of development expenditure

Select ONE answer:

1. (1) and (2)
2. (3) Only
3. (2) and (3)
4. (1) Only

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.

Alex plc is preparing its financial statements for the year ending 31 March 2024.

The initial trial balance has the following figures relating to tax:

Tax payable as at 1 April 2023 £14,300
Tax paid during the year ended 31 March 2024 £12,700

The estimated tax liability for the year ended 31 March 20247 is £15,600.

The figure for tax expense in Alex plc’s income statement will be?

Select ONE answer:

1. £12,700
2. £14,000
3. £17,200
4. £28,300

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. Notcorrect
2. Correct ==> Dr Cash £12,700 + Dr C/D Tax Liability £15,600 = Cr B/D Balance £14,400 + Income Statement (Bal Fig) £14,000
3. Not correct
4. Not correct

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

Alex Ltd has a balance of £3,200 (debit) on its tax account as at 13 December 2022 relating to the tax payable on the 2021 profits.

Alex Ltd’s estimated tax liability for the year to December 2023 is £24,500.

The tax charge in the income statement for the year ended 13 December 2023 is?

Select ONE answer:

1. £21,300
2. £24,500
3. £27,700
4. £30,900

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 — > B/d £3,200 + C/d of £24,500 = £27,700
4. Not correct

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

Which of the following general journal entries may be accepted as being correct according to their narratives?

Select ONE answer:

1. Dr Wages expense account – £87,000 Cr NCA Buildings account – £87,000 (Labour and materials used in construction of a Building extension in a factory)
2. Directors’ personal accounts – £70,000 Cr Directors’ remuneration – £70,000 (Directors’ bonuses transferred to their “current” accounts)
3. Dr Suspense account £10,000 Cr Sales account £10,000 (Correction of £10,000 undercast of the sales account)
4. Dr Discount received account £2,000 Cr Suspense account £2,000 (Correction of misposting of discount received from cash book)

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 –> (1) is wrong because labour and construction costs of building a factory would be debited to non-current assets cost. (2) is wrong because directors’ remuneration would be debited to the expense account, and (4) is wrong because a mis posting of discount received would be a debit to suspense and a credit to the discount received account.
4. Not correct

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