Tag: Management

Accounting Multiple Choice Question – 21 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 sole trader’s trial balance totals were:

Debit £387,642

Credit £379,642

A suspense account was opened for the difference.

Which of the following errors would have the effect of reducing the difference when corrected?

Select ONE answer:

  1. The bank deposit balance of £8,000 has been omitted from the trial balance
  2. £4,000 received for rental income for part of the office being sublet has been correctly recorded in the cash book but debited to the rent expense account
  3. No entry has been made in the records for a cash sale of £8,000
  4. £8,000 paid for repairs to plant has been debited to the plant asset account

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 – When the error is corrected there will be a credit entry of £8,000 to rent receivable.
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 20 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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At the end of its first year of trading on 30 June 2021 Alex Ltd’s net assets are £207,594.

It has share capital of £50,000 made up of 25p equity shares issued at 40p each, and a retained profits reserve of £107,594.

In relation to Alex Ltd’s balance sheet as at 30 June 2021 which of the following be true?

Select ONE answer:

  1. It has a general reserve of £50,000
  2. It has share premium of £100,000
  3. It has a general reserve of £20,000
  4. It has share premium of £50,000

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 == > Share capital + Share Premium of £30K + profit reserve + General Reserve (Balance Number) = Closing position
  4. Not correct

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Accounting Multiple Choice Question – 19 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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Which of the following transactions would initially be recorded in a company’s journal rather than its cash book?

Select ONE answer:

  1. Bonus issue of shares
  2. Sale of goods for cash to a customer
  3. Receipt of loan from a bank
  4. Purchase for cash of shares in another company

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
  2. Not correct
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 18 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 following balances have been extracted from Alex Ltd’s Trial Balance as at 31 December 2018.

                                                                                                                                                                                             Debit                  Credit

Retained profits as at 1 January 2018 £4,695,600
10% debentures issued in 2015 £1,300,000
Debenture interest paid £65,000

Operating profit for the year ended 31 December 2018 is £520,000. Corporation tax for the year has been estimated at £156,000.

What is the figure for retained profits in Alex’s SOFP as at 31 December 2018?

Select ONE answer:

  1. £4,929,600
  2. £4,994,600
  3. £5,059,600
  4. £5,215,600

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 – 4,695,600 + 520,000 – (130,000) – (156,000) = 4,929,600
  2. Not correct
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 17 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 Ltd issues 250,000 equity shares with a nominal value of £2 each at a price of £3.55 each for cash.

Which of the following sets of entries would be made to record this transaction?

Select ONE answer:

  1. Credit Bank £887,500, Debit Share capital £500,000, Debit Share premium £387,500
  2. Debit Bank £887,500, Credit Share capital £250,000, Credit Share premium £637,500
  3. Debit Bank £887,500, Credit Share capital £500,000, Credit Share premium £387,500
  4. Credit Bank £887,500, Debit Share capital £250,000, Debit Share premium £637,500

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 == > Cash raised is 250,000 x £3.55 = £887,500, which is debited to cash at bank. The credit to share capital is 250,000 x £2 = £500,000, while the credit share premium is250,000 x £1.55 = £387,500
  4. Not correct

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