Tag: Topic 3

Accounting Multiple Choice Question – 30 December 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 capital balance of Alex Trading, who is a sole trader, would change as a result of?

Select ONE answer:

  1. A credit customer paying by cheque
  2. Raw materials being purchased on credit
  3. Non-current assets being purchased on credit
  4. A personal petrol expense of Alex being paid for out of the business’s petty cash

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 4

  1. Not correct
  2. Not correct
  3. Not correct
  4. Correct

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Accounting Multiple Choice Question – 26 December 2023

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 items should be treated as capital expenditure in the financial statements of a sole trader?

Select ONE answer:

  1. £500 taken by the proprietor to buy himself a hi-fi music system for his family home
  2. £400 spent on purchasing a new PC to replace his secretary’s old one
  3. £2,000 on purchasing a machine for resale to his customers
  4. £150 paid to a painter for redecorating his office

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 – 24 December 2023

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

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A loan due for repayment in 20 months’ time has been included as a current liability.

What will be the effect when this is corrected?

Select ONE answer:

  1. increase net assets
  2. increase net current assets
  3. no effect on net current assets
  4. reduce net current assets

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

Accounting Multiple Choice Question – 17 December 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 following information has been extracted from Alex Trading’s books of accounts on the last day of the financial year, 31 December 2023?

  • Revenue – £ 35,860
  • Inventory at 1 January 2023 – £4,070
  • Inventory at 31 December 2023 – £5,160
  • Purchases – £10,800
  • Returns outwards – £3,100
  • Returns inwards – £2,840

What is the value of ‘Cost of Sales’ that will be shown in the Income Statement for the year ended 31st May 2023?

Select ONE answer:

  1. £29,250
  2. £9,710
  3. £6,610
  4. £6,870

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 – £4,070 + £10,800 – £3,100 – £5,160
  4. Not correct

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Accounting Multiple Choice Question – 16 December 2023

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

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A business buys, on credit, a new machine for their factory from Alex Trading Ltd.

The double entry to record this transaction is?

Select ONE answer:

  1. account to be debited: MACHINERY and account to be credited: ALEX TRADING LTD
  2. account to be debited: MACHINERY and account to be credited: BANK
  3. account to be debited: PURCHASES and account to be credited: ALEX TRADING LTD
  4. account to be debited: PURCHASES and account to be credited: BANK

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– The account that is debited is the NCA account, ‘machinery’. This ensures that the new machine is correctly shown in the SOFP. The ‘purchases’ account is only used for the purchase of goods for re-sale. The credit entry is to the relevant accounts payables account, which uses the name of the supplier, to show that money is owed to the supplier, as ALEX TRADING LTD account is a current liability account.
  2. Not correct
  3. Not correct
  4. Not correct

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