Tag: Management Accounting

Accounting Multiple Choice Question – 28 September 2024

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

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The net assets of Alex’s business (who is a sole trader) decreased by £11,025 over the year to 31 October 2023.

During that year Alex had paid in additional capital of £14,000, drawn £875 in cash each month and on one occasion, taken goods costing £2,625 for his own use.

The loss made by the business for the year ended 31 October 2023 was?

Select ONE answer:

  1. £10,150
  2. £11,900
  3. £21,525
  4. £25,025

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 – Decrease in net assets £11,025 + Capital introduced £14,000 – Drawings (875 ×12) £10,500 = Loss £11,900
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 27 September 2024

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

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A local taxes prepayment of £475 at the reporting date for his financial statements was treated as an accrual in preparing Alex’s a sole trader’s income statement.

As a result, Alex’s profit was?

Select ONE answer:

  1. Understated by £950
  2. Overstated by £950
  3. Understated by £475
  4. Overstated by £475

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 – Understated by 2 x £475 = £950
  2. Not correct
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 26 September 2024

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

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On 1 April 2023, Alex who is a sole trader paid £3,080 in local taxes for the year ending 31 March 2024.

This was an increase of 10% on the charge for the previous year.

What is the correct charge for local taxes in Alex’s profit and loss account for the year ended 31 December 2023?

Select ONE answer:

  1. £2,870
  2. £3,003
  3. £3,010
  4. £3,080

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 == > £3,080 × 9/12 + £3,080 * 1.1 * 3/12 = £3,010
  4. Not correct

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Accounting Multiple Choice Question – 25 September 2024

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

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Alex is a sole trader prepares financial statements each year to 31 May.

His rent is payable quarterly in advance on 1 January, 1 April, 1 July and 1 October.

Local property taxes are paid each year in two equal instalments on 1 April and 1 October.

His annual rental for the calendar years 2022 and 2023 was £4,800 and £5,400 respectively but on 1 January 2024 this was increased to £6,600 per annum.

Local property tax for the last three years has been as follows:

•Year commencing 1 April 2022 – 3,600

•Year commencing 1 April 2023 – 3,900

•Year commencing 1 April 2024 – 4,500

In preparing his financial statements for the year ended 31 May 2024, the charge to the profit and loss account from his rent and local property tax account would be what for Alex?

Select ONE answer:

  1. £9,900
  2. £10,100
  3. £10,200
  4. £10,300

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 1

  1. Correct – £4,000 tax +£5,900 rent = £9,900 == > Rent 1June 2023 to 31 December 2023 = 7/12 x £5,400 + 1 January 2024 to 13 May 2024 = 5/12 x £6,600 = £5,900 + Local property tax 1 June 2023 to 31 March 2024 = 10/12 x £3,900 + 1 April 2024 to 31 May 2024 = 2/12 x £4,500 = £4,000
  2. Not correct
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 24 September 2024

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

apple devices books business coffee
Photo by Serpstat on Pexels.com

A gas accrual for £400 at the reporting date was treated as a prepayment in a sole trader’s financial statements.

As a result the profit was?

Select ONE answer:

  1. Understated by £800
  2. Understated by £400
  3. Overstated by £800
  4. Overstated by £400

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 == > The accrual should have increased expenses by £400 but instead expenses were decreased by £400 leading to an overstatement of profit of £800.
  4. Not correct

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