IGCSE Accounting Revision

Which tasks would be carried out by a book-keeper?

• analysing business results
• maintaining a cash book
• preparing financial statements
• writing up ledger accounts

Khalid started a business on 1 April 2018 with a capital of $90 000. He provided the following information on 31 March 2019. $ non-current assets 75 000 current assets 32 000 current liabilities 24 000 drawings during the year 19 000 What was the profit or loss for the year ended 31 March 2019?

• $12 000 loss
• $12 000 profit
• $26 000 loss
• $26 000 profit

Which accounting principle requires profit to be recognised as earned when the legal ownership of goods passes to the purchaser?

• going concern
• Money Measurement
• Prudence
• Realisation

The employees of a business are highly skilled but this is not recorded in the financial statements of the business. Which accounting principle is being applied?

• going concern
• money measurement
• prudence
• realisation

‘Financial information must be free from errors and bias.’ To which accounting objective does this refer?

• comparability
• relevance
• reliability
• understandability

Amber updated her cash book after receiving her bank statement. The updated cash book balance was an overdraft of $250. The bank statement did not include cheques not presented, $96, and amounts not credited, $183. What was the balance shown on the bank statement?

• $163 credit
• $163 debit
• $337 credit
• $337 debit

Which statement about a bank reconciliation statement is correct?

• It includes items recorded by the trader not yet recorded by the bank.
• It is a copy of the trader’s account as it appears in the books of the bank.
• It is sent by the bank to the trader at regular intervals.
• It summarises the bank columns in a trader’s cash book.

Amrik started a business on 1 January 2017 and purchased a machine costing $18 000. He decided to depreciate the machine at 20% per annum using the reducing (diminishing) balance method. No depreciation was to be charged in the year of disposal. The machine was sold for $13 300 on 1 July 2018. What was the profit or loss on the sale of the machine?

• loss $1100
• loss $4700
• profit $1780
• profit $2500

Amelia rented premises to a tenant. At the end of Amelia’s financial year the tenant had paid 2 months’ rent in advance. Which entries would Amelia make in her ledger?

• credit the rent payable account and carry down as a debit balance
• debit the rent payable account and carry down as a credit balance
• credit the rent receivable account and carry down as a debit balance
• debit the rent receivable account and carry down as a credit balance

An invoice for the purchase of goods on credit, $980, was incorrectly recorded in the purchases journal as $890. Which type of error was made?

• commission
• complete reversal
• Original Entry
• Principle