Tag: Topic 8

Accounting Multiple Choice Question – 29 October 2023

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

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In the last year Alex Trading purchased inventory using cash for £11,680 and also purchased good for resale on credit for £32,485.

Trade payables were paid every 30 days.

What was the closing accounts payable balance?

Select ONE answer:

  1. £960
  2. £1,710
  3. £2,670
  4. £3,630

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 – 365 days / 30 days = 12.1667 == > £32,485 / 12.1667 = £2,670
  4. Not correct

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Accounting Multiple Choice Question – 15 October 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 profit margins of Alex Trading Ltd over two years showed the following information at the 31 March year-end

  • Gross profit margin: Year 1 – 37.2% AND Year 2 – 39.1 %
  • Net profit margin: Year 1 – 12.2% AND Year 2 – 11.8 %

What combination of factors could have caused these changes?

Select ONE answer:

  1. a change in the combination of goods sold leading to lower selling costs
  2. a loss of trade discounts on purchases but an increase in cash discounts taken from suppliers
  3. an advertising campaign to promote higher sales leading to higher selling prices
  4. an increase in both production and selling costs

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

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Accounting Multiple Choice Question -14 October 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 data is available at the end of a financial year for Alex Trading Ltd:

  • opening inventory – £500,000
  • purchases – £2,250,000
  • closing inventory – £750,000
  • gross profit margin – 50 %
  • Trade receivables collection period – 60 days

Sales are all made on credit and accrue evenly over the 360-day accounting period.

What is the value of trade receivables at the year-end?

Select ONE answer:

  1. £333,333
  2. £375,000
  3. £500,000
  4. £666,667

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 – COS = £500k + £2,250k – £750k = £2M * 2 = £4M revenue / 360 * 60 == > £666,667

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Accounting Multiple Choice Question – 13 October 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 taken from a recent statement of financial position of Alex Trading:

  • non-current assets – £30,000
  • working capital ratio – 5:1
  • capital – £34,000
  • current liabilities – £1,000

What is the amount of the current assets?

Select ONE answer:

  1. £1,000
  2. £5,000
  3. £6,000
  4. £20,000

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 == > A-L = C therefore £30k – £1k = £29k thus CA are £5k or wcr of 5:1 means £5k / £1K = 5:1
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 12 October 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 ratio indicates how efficiently a company controls its overheads?

Select ONE answer:

  1. current assets / current liabilities
  2. gross profit / revenue
  3. Profit for the year / revenue
  4. revenue / capital employed

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

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