C1: Introduction to accounting

which of the following should be accounted for as capital expenditure?

• the annual cost of painting a factory floor

• the repair of a window in a building

• the purchase of a vehicle by a garage for re-sale

• legal fees incurred on the purchase of a building

Tags

capital and revenue expenditure

a statement of financial position is best described as:

• a snapshot of the entity's financial position at a particular point in time

• a record of an entity's financial performance over a period of time

• a list of all the income and expenses of the entity at a particular point in time

• a list of all assets and liabilities over a period of time

materiality is an entity specific aspect of which qualitative characteristics?

• relevance

• understandability

• faithful representation

• comparability

which three of the following are fundamental principals of IESBA Code of ethics for professional accounts

• integrity

• objectivity

• independence

• confidentiality

• courtesy

The ICAEW uses rule-based approach

• True

• False

a code based upon a set of principles requires a professional accountant to comply with a set of specific rules

• True

• False

which of the following is not a source of the accounting rules embodied in UK GAAP？

• The companies act 2006

• UK Accounting standards

• Listing requirements of the London stock exchange

• accounting requirements of an entity's US parent company

which of the following is correct?

• the ICAEW Code of Ethics applies to its members only

• the ICAEW Code of Ethics applies to its members and employees of member firms only

• the ICAEW Code of Ethics applies to its members, employees of member firm and ICAEW students

• the ICAEW Code of Ethics applies to its members, employees of member firm ICAEW students and all other members of UK Accountancy bodies

which of the following definitions of the going concern concept in accounting is consistent with IAS 1, Presentation of financial statements?

• the directors do not intend to liquidate the entity or to cease trading in the foreseeable future

• the entity is able to pay its debts as and when they fall due

• the directors expect the entity's assets to yield future economic benefits

• financial statements are prepared on the assumptions that the entity is solvent and would able to pay all creditors in the full in event of being wound up

Which of the following is classified as revenue expenditure?

• purchase of inventories for resale

• purchase of motor vehicles to deliver goods to customer

• purchase of machinery for use in production

• purchase of a warehouse to story inventory

Tags

capital and revenue expenditure