Income State and TB S09/10

A shop makes all its sales for cash.

Where does the sales account appear?

• cash book

• nominal (general) ledger

• sales journal

• sales ledger

Which account could appear in either the debit column or the credit column of a trial balance?

• bad debts

• bank

• drawings

• sales

What is an income statement (profit and loss account)?

• A list of all the assets and liabilities of a business at a particular

  date.

• A list of all the balances in the ledger accounts of a business at a particular date.

• A statement of receipts and payments of a business during a

  particular period.

• A summary of income and expenditure of a business during a

  particular period.

How is working capital calculated?

• current assets – current liabilities

• current assets + current liabilities

• non-current (fixed) assets + current assets – current liabilities

• non-current (fixed) assets + current assets + current liabilities

How is total Capital (Employed) calculated?

• current assets – current liabilities

• current assets + current liabilities

• non-current (fixed) assets + current assets – current liabilities

• non-current (fixed) assets + current assets + current liabilities

A sole trader compares his results with those of a similar business.

Which shows how well expenses are being controlled?

• bank balance

• cost of sales

• gross profit

• profit for the year

Miriam had the following assets and liabilities on 30 December 2008.

$

motor vehicles 5 000

stock 16 000

trade receivables 4 000

bank (dr) 3 000

trade payables 11 000

On 31 December 2008 Miriam invested a further $4500 as capital.

What was Miriam’s capital on 31 December 2008?

• $21 500

• $28 000

• $32 500

• $43 500

Which appears in a Statement of Financial Position of a sole trader?

• drawings

• equipment repairs

• gross profit

• Opening Inventory

At the end of her first year of trading, Mona provides the following information.

$

sales 50 500

purchases 44 100

carriage inwards 2 300

carriage outwards 3 900

closing inventory 4 600

What is Mona’s gross profit?

• $6400

• $7100

• $8700

• $11 000

Which accounting principle requires the financial transactions of a business to be treated separately from those of the owner?

• business entity

• duality

• going concern

• matching