Tag: Limited Company Financial Statements

Accounting Multiple Choice Question – 13 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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What measures the rate of return on an ordinary share?

Select ONE answer:

  1. dividend paid
  2. dividend yield
  3. earnings per share
  4. price-earnings ratio

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

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Accounting Multiple Choice Question – 12 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 plc’s authorised share capital is 1 million ordinary shares of £1 each.

800,000 shares have been issued and have a market value of £2.50 each.

Year end results show the following:

  • profits before interest and taxation – £100k
  • profits after interest and taxation – £80k
  • profits after interest, taxation and ordinary dividends – £50k

What is the price-earnings ratio?

Select ONE answer:

  1. 10
  2. 20
  3. 25
  4. 40

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- £2.50 / (£80,000 / 800,000) ==> 25
  4. Not correct

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Accounting Multiple Choice Question – 10 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 table below shows the capital structure of Alex plc:

  • share capital made up of £5 shares – £300k
  • share premium account – £200k
  • Retained earnings – £500k
  • 10 % debenture (issued 3 years ago) – £600k
  • OPERATING PROFITS average £150,000 a year.

What is the return on shareholders’ funds?

Select ONE answer:

  1. 9.0%
  2. 9.4%
  3. 15.0%
  4. 18.75%

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 – Correct – (150k – £60k (£600k debenture @ 10%) / £300K + £200k + £500k + £600k ==> 9.0%. – many people forget to deduct the interest of £60k from the operating profits when calculating the return on the shareholders’ funds.
  2. Not correct
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 9 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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What is not required to be disclosed in the published company accounts?

Select ONE answer:

  1. auditors’ remuneration
  2. depreciation policy
  3. legal costs
  4. salary of highest paid director

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 – 8 July 2023

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

Photo by Olya Kobruseva on Pexels.com

Alex plc shows the following balances that have been extracted from it’s Statement of Financial Position as at 31 March 2023.

  • share premium – £125k
  • provision for re-organisation – £90k
  • trade payables – £82k
  • accruals – £12k
  • estimated tax refund – £25k
  • bank overdraft – £74k
  • cash at bank – £44k

What amount is shown as current liabilities in the accounts?

Select ONE answer:

  1. £136,000
  2. £168,000
  3. £193,000
  4. £258,000

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 2

  1. Not correct
  2. Correct – £82K + £12k + £74k
  3. Not correct
  4. Not correct

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