Diagnostic Test IGCSE Y2 Accounting Chapters 1 to 14 MCQ

A business employs a book-keeper and an accountant.

Which task does the accountant perform?

• A extracting balances from the ledger accounts to produce a trial balance

• B making a journal entry to record the credit sale of a non-current asset

• C preparing a monthly report that analyses the profitability of the company

• D recording sales and purchases invoices in the books of prime entry

Which transaction has happened?

• A A payment was made to a credit supplier after taking a cash discount.

• B A payment was received from a credit customer after allowing a cash discount.

• C Goods were sold to a credit customer for less than their cost price.

• D Goods were sold to a credit customer for more than their cost price.

The double entry system of book-keeping consists of processing accounting data in a certain order. What is the correct order?

• A business documents, books of prime entry, ledgers, trial balance

• B business documents, ledgers, trial balance, books of prime entry

• C books of prime entry, business documents, trial balance, ledgers

• D books of prime entry, ledgers, trial balance, business documents

Imran made an entry on the debit side of the cash book in the bank column. What could the corresponding credit entry represent?

• A a decrease in cash

• B a decrease in a trade payable

• C an increase in a non-current asset

• D an increase in a trade receivable

What was the closing balance on the statement of account issued by Dave to Peter on 30 April?

• A $260

• B $310

• C $321

• D $421

Alisha entered the credit notes she received in March in the correct returns journal. How was the total of this journal recorded in the ledger at the end of March?

• A credit purchases returns account

• B credit sales returns account

• C debit purchases returns account

• D debit sales returns account

Which statements about trade discount are correct?

1 It is debited to the supplier’s account.

2 It is only given if the invoice is paid within the period allowed by the supplier.

3 It is shown as a deduction from the price of the goods on an invoice.

4 It is used to encourage bulk buying.

• A 1 and 2

• B 1 and 3

• C 2 and 4

• D 3 and 4

8 Why is a trial balance prepared?

• A to analyse financial information

• B to assist in the preparation of financial statements

• C to control the costs of the business

• D to evaluate the performance of the business

9 Which group of account balances would appear in the credit column of a trial balance?

• A assets, purchases, drawings

• B discount received, capital, sales returns

• C liabilities, expenses, sales

• D sales, capital, purchases returns

Which item is a revenue receipt?

• A cash invested by the owner of the business

• B proceeds from the sale of a non-current asset at book value

• C rent received from letting part of the premises

• D short-term loan received from a finance company