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WorksheetsCFAB Tutorial Chapter 1-5
Total questions: 25
Worksheet time: 12mins
Which of the following best describes the accruals concept?
Assets are matched with liabilities
Income is matched with expenses
Income is matched with liabilities
Expenses are matched with assets
The statement of financial position sets out the entity's:
Financial position over a period of time
Financial performance over a period of time
Financial position at one point in time
Financial performance at one point in time
A business has sales of £100,000, cost of sales of £60,000 and expenses of £20,000. The gross profit margin is:
60%
40%
20%
80%
Which of the following is a source document that would be entered into the accounting system?
Debit note
Credit note
Sales order
Purchase order
Capital is the amount:
The entity's owners owe to it
The entity's customers owe to it
The entity owes to its creditors
The entity 'owes' to its owners
Which three of the following are elements of financial statements as identified by the IASB's Conceptual Framework?
Income
Expenses
Profits
Losses
Equity
Which of the following best explains the imprest system of petty cash?
Each month an equal amount of cash is transferred into petty cash
The exact amount of petty cash expenditure is reimbursed at intervals to maintain a fixed float
Petty cash must be kept under lock and key
The petty cash total must never fall below the imprest amount
Holly has downloaded a transaction report from her electronic banking system. The report shows a receipt of £565 which the computerised accounting system has not been able to match to a transaction.
Which of the following transactions may have resulted in the unmatched receipt?
A payment made to settle a supplier invoice of £600 on which a prompt payment discount of £35 has been taken
A standing order paid in respect of rental charges of £565 for the month
Proceeds of £565 from the sale of machinery to a competitor
A receipt from a credit customer in settlement of an invoice of £565
In double-entry bookkeeping, which of the following statements is true?
Credit entries decrease liabilities and increase income
Debit entries decrease income and increase assets
Credit entries decrease expenses and increase assets
Debit entries decrease expenses and increase assets
George purchases goods on credit from Hardeep for £1,000. £100 of these goods are defective and George returns them to Hardeep. What document would Hardeep issue to George in respect of the returned goods?
Invoice
Remittance advice
Credit note
Delivery note
A bakery business, which is registered for VAT, issued the following invoice to one of its customers:
Assuming the VAT rate is 20% and that the invoice amounts are exclusive of VAT, what amount of VAT should have been charged on the invoice?
£360
£300
£285
£342
What is the correct double entry to record an invoice raised to a credit customer who is not expected to take advantage of an early settlement discount?
Debit Revenue, Credit Receivables
Debit Payables, Credit Revenue
Debit Receivables, Credit Revenue
Debit Revenue, Credit Payables
Which two of the following are source of documents that contain information that will be entered into a business's accounting system?
Goods received note
Invoice to a customer
Purchase order to a supplier
Cheque to a supplier
Delivery note to a customer
Richard is a VAT registered trader whose sales and purchases carry VAT at the standard rate of 20%. Richard sells a customer goods on credit for £4,800 exclusive of VAT. The double entry to record this transaction is:
Debit Sales £4,800, Debit VAT £960, Credit Receivables £5,760
Debit Sales £4,000, Debit VAT £800, Credit Receivables £4,800
Debit Receivables £5,760, Credit Sales £4,800, Credit VAT £960
Debit Receivables £4,800, Credit Sales £4,000, Credit VAT £800
Plym plc is a retailer which is registered for value added tax. All sales, and all purchases of goods for resale, attract value added tax at the rate of 20%. For the year to 30 June 2018, Plym plc paid £69,600 to suppliers in respect of goods for resale and showed revenue in SOPL of £89,400. There is no change in the figures for inventory and trade payables in the SOFP at 30 June 2017 and 30 June 2018.
WHat was Plym plc gross profit for the year ended 30 June 2018.
£19,800
£4,900
£31,400
£16,500
Which of the following would be classified as a non-current asset
Cash
Prepayments
Land
Receivables
Gerrard Ltd is registered for VAT. In the month of April, it sells goods to customers for a total of £89,436 excluding VAT and purchases goods from suppliers for a total of £86,790 including VAT.
What is the net amount shown in Gerrard ltd's VAT account at the end of April?
£3,422 debit
£2,452 debit
£3,422 credit
£2,452 credit
According to IAS 1 which of the following does not represent an objective of financial statements?
To provide information to investors in making economic decisions
To provide information to managers in making business decisions
To show the results of management's stewardship of the resources entrusted to it
To help users predict the entity's future cash flows
A sole trader had trade receivables of £2,700 at 1 May and during May made cash sales of £7,200, credit sales of £16,500 and received £15,300 from his credit customers.
The balance on his trade receivables account at the end of May was:
£1,500
£3,900
£8,700
£11,100
Rose Ltd was set up on 1 May 20X8 with opening capital of £1,000. During the month of May, it entered into the following transactions:
Purchases of goods for resale, on credit £12,100
Payments to credit suppliers £ 8,400
Sales on credit £16,200
Sales in cash £ 1,300
Receipts from credit customers £ 3,200
Non-current assets purchased for cash £ 1,500
Depreciation £ 100
Other expenses, all paid in cash £ 800
What is the net profit earned by Rose Ltd in the month of May 20X8?
£3,200
£5,400
£4,500
£3,000
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 the assets and liabilities of the entity over a period of time
The ICAEW Code only applies to the paid activities of the professional accountant.
True
False
The following are balances on the accounts of Luigi, a sole trader, as at the end of the current financial year and after all entries have been processed and the profit for the year has been calculated.
Non-current assets £85,000
Trade receivables £7,000
Trade payables £3,000
Bank loan £15,000
Accumulated depreciation, non-current assets £15,000
Inventory £4,000
Accruals £1,000
Prepayments £2,000
Bank overdraft £2,000
Which is the balance on Luigi's capital account?
£59,000
£66,000
£62,000
£64,000
An entity's transactions are recorded first in:
Books of original entry
Ledger accounts
The statement of profit or loss
The statement of financial position
Which of the following is an item of capital expenditure?
Cost of goods sold
Purchase of machine
Repairs to a machine
Wages cost
