Tag: Trade Receivable Days

Accounting Multiple Choice Question – 7 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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Alex Trading has a Trade Receivable days ratio of 40 days based on year-end receivables.

Annual sales are £180,000 of which 13 % are cash sales.

What is the year end receivables figure based on a year of 360 days?

Select ONE answer:

  1. £2,600
  2. £17,400
  3. £20,000
  4. £45,200

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 –£180k * 0.87 = (£156.6 / 360) *40 = £17.4k
  3. Not 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 – 5 September 2023

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

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During a financial year, Alex Ltd made cash sales of £63,875 and credit sales of £146,000.

Trade receivables pay every 40 days.

What is the total of trade receivables at the end of the year?

Select ONE answer:

  1. £7,000
  2. £12,167
  3. £16,000
  4. £23,000

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 –£146,000 / 365 days * 40 days = £16,000
  4. Not correct

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

Accounting Multiple Choice Question – 14 August 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’s sales are made evenly over a year (360 days).

10 % of the sales are for cash.

The debtor balance is £26,700 and the debtor collection period is 30 days.

What are the total sales (cash and credit) for the year?

Select ONE answer:

  1. £320,400
  2. £356,000
  3. £801,000
  4. £890,000

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 – £26,700 * 12 = £320,400 / 0.9 = £356,000
  3. Not correct
  4. Not correct

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