WorksheetsFA - CH-11,12,13 &18
Total questions: 42
Worksheet time: 47mins
Which of the following statements regarding payables and receivables are TRUE?
A Statement 1 only
B Statements 1 and 2 only
C Statements 1 and 3 only
D Statement 3 only
What charge for receivables expense should appear in the company's statement of profit or loss for the year ended 31 December 20X2?
A $74,200
B $51,800
C $28,000
D $24,200
What amount should appear in Q's statement of profit or loss for receivables expense for the year ended 30 June 20X3?
A $12,600
B $16,600
C $48,600
D $30,600
What should be the charge in the statement of profit or loss for the year ended 30 September 20X3 for receivables expense?
A $42,000
B $33,925
C $70,500
D $32,500
What figure should appear in the company's statement of profit or loss for the year ended 30 June 20X4 for receivables expense?
A $155,000
B $364,000
C $281,000
D $11,000
A company has received cash for a debt that was previously written off. Which of the following is the correct double entry to record the cash received?
A Dr. Irrecoverable debts expense Cr. Accounts receivable
B Dr. Cash Cr. Irrecoverable debts expense
C Dr. Allowance for receivables Cr. Accounts receivable
D Dr. Cash Cr. Allowance for receivables
11.7 Which of the following would a decrease in the allowance for receivables result in?
[a] An increase in liabilities
[b] A decrease in working capital
[c] A decrease in net profit
[d] An increase in net profit
An increase in an allowance for receivables of $8,000 has been treated as a reduction in the allowance in the financial statements. Which of the following explains the resulting effects?
[a] Net profit is overstated by $16,000, receivables overstated by $8,000
[b] Net profit understated by $16,000, receivables understated by $16,000
[c] Net profit overstated by $16,000, receivables overstated by $16,000
[d] Gross profit overstated by $16,000, receivables overstated by $16,000
What is the total receivables expense for the year?
[a] $200 debit
[b] $1,800 debit
[c] $2,200 debit
[d] $1,800 credit
A company has been notified that a customer has been declared bankrupt. The company had previously made an allowance for this debt. Which of the following is the correct double entry to account for this new information
[a] Dr. Irrecoverable debts Cr. Receivables
[b] Dr. Receivables Cr. Irrecoverable debts
[a] Dr. Allowance for receivables Cr. Receivables
[a] Dr. Receivables Cr. Allowance for receivables
What is the charge to statement of profit or loss for receivables expense for the year?
[A] $1,500
[B] $1,000
[C] $650
[D] $550
What figure should appear in the company’s statement of profit or loss for rent receivable in the year ended 30 June 2006?
[a] $840,500
[b] $1,100,100
[c] $569,100
[d] $828,700
The issued share capital of Alpha, a limited liability company, is as follows: $
Ordinary shares of 10c each 1,000,000
8% Redeemable preference shares of 50c each 500,000
In the year ended 31 October 20X2, the company has paid the preference dividend for the year and an interim dividend of 2c per share on the ordinary shares. A final ordinary dividend of 3c per share was proposed, before the reporting date.
What would be recognised for dividends in the equity section of the statement of financial position at 31 October 20X2?
$580,000
$90,000
$130,000
$200,000
When a company makes a rights issue of equity shares which of the following effects will the issue have?
1 Assets are increased
2 Retained earnings are reduced
3 Share premium account is reduced
4 Investments are increased
1 only
1 and 2
3 only
1 and 4
A company made an issue for cash of 1,000,000 50c shares at a premium of 30c per share.
Which one of the following journal entries correctly records the issue?
Dr. Share Capital 5,00,000 ; Dr. Share Premium 3,00,000; Cr. Bank 8,00,000
Dr. Bank 8,00,000 ; Cr. Share Capital 5,00,000 ; Cr. Share Premium 3,00,000
Dr. Bank 13,00,000 ; Cr. Share Capital 10,00,000 ; Cr. Share Premium 3,00,000
Dr. Share Capital 10,00,000 ; Dr. Share Premium 3,00,000; Cr. Bank 13,00,000
At 31 December 20X1 the capital structure of a company was as follows:
Ordinary share capital $
100,000 shares of 50c each 50,000
Share premium account 180,000
During 20X2 the company made a bonus issue of 1 share for every 2 held, using the share premium account for the purpose, and later issued for cash another 60,000 shares at 80c per share.
What is the company's capital structure at 31 December 20X2?
Ordinary share capital Rs.1,05,000; Share premium account Rs.1,73,000
Ordinary share capital Rs.1,30,000; Share premium account Rs.1,73,000
Ordinary share capital Rs.1,30,000; Share premium account Rs.1,37,000
Ordinary share capital Rs.1,05,000; Share premium account Rs.1,37,000
An organisation's year end is 30 September. On 1 January 20X6 the organisation took out a loan of $100,000 with annual interest of 12%. The interest is payable in equal instalments on the first day of April, July, October and January in arrears.
How much should be charged to the statement of profit or loss (SPL) for the year ended 30 September 20X6, and how much should be accrued on the statement of financial position (SOFP)?
SPL $12,000; SOFP $3,000
SPL $9,000; SOFP $3,000
SPL $9,000; SOFP Nil
SPL $6,000; SOFP $3,000
Which of the following statements about company financial statements is/are correct, according to International Financial Reporting Standards?
1. Dividends paid on ordinary shares should be included in the statement of profit or loss and other comprehensive income.
2. Dividends paid on redeemable preference shares are treated in the same way as dividends paid on ordinary shares.
3. The statement of profit or loss and other comprehensive income shows the gain on revaluation of non-current assets for the period.
1, 2 and 3
2 and 3
3 only
All three statements are correct
At 30 June 20X2 a company's capital
structure was as follows :
Ordinary share capital $
500,000 shares of 25c each 125,000
Share premium account 100,000
In the year ended 30 June 20X3 the company made a rights issue of 1 share for every 2 held at $1 per share and this was taken up in full. Later in the year the company made a bonus issue of 1 share for every 5 held, using the share premium account for the purpose.
What was the company's capital structure at 30 June 20X3?
Ordinary share capital Rs.4,50,000; Share premium account Rs.25,000
Ordinary share capital Rs.2,25,000; Share premium account Rs.2,50,000
Ordinary share capital Rs.2,25,000; Share premium account Rs.3,25,000
Ordinary share capital Rs.2,12,500; Share premium account Rs.2,62,500
At 30 June 20X2 a company had $1m 8% loan notes in issue, interest being paid half-yearly on 30 June and 31 December.
On 30 September 20X2 the company redeemed $250,000 of these loan notes at par, paying interest due to that date.
On 1 April 20X3 the company issued $500,000 7% loan notes, interest payable half-yearly on 31 March and 30 September.
What figure should appear in the company's statement of profit or loss for interest payable in the year ended 30 June 20X3?
$88,750
$82,500
$65,000
$73,750
A limited liability company issued 50,000 ordinary shares of 25c each at a premium of 50c per share. The cash received was correctly recorded but the full amount was credited to the ordinary share capital account.
Which one of the following journal entries is needed to correct this error?
Dr. Share premium account Rs. 25,000; Cr. Share capital account Rs.25,000
Dr. Share capital account Rs. 25,000; Cr. Share premium account Rs.25,000
Dr. Share capital account Rs. 37,500; Cr. Share premium account Rs.37,500
Dr. Share capital account Rs. 25,000; Cr. Cash Rs. 25,000
Which one of the following journal entries could correctly record a bonus issue of shares?
Dr. Cash Rs. 1,00,000 Cr. Ordinary share capital Rs.1,00,000
Dr. Ordinary share capital Rs.1,00,000 Cr. Share Premium Rs. 1,00,000
Dr. Share Premium Rs. 1,00,000 Cr. Ordinary share capital Rs.1,00,000
Investment Rs. 1,00,000 Cr. Cash Rs. 1,00,000
Which of these statements about limited liability companies is/are correct?
1. A company might make a bonus issue of shares to raise funds for expansion.
2. No cash is received when a company makes a rights issue of shares, instead other reserves (usually share premium) are capitalised and reclassified as share capital.
3. A rights issue of shares dilutes the shareholding of existing shareholders if they do not take up their rights.
1 and 3
2 and 3
1 and 2
3 only
At 1 January 20X0 the capital structure of Q, a limited liability company was as follows : $
Issued share capital 1,000,000 ordinary shares of 50c each 500,000
Share premium account 300,000
On 1 April 20X0 the company made an issue of 200,000 50c shares at $1.30 each, and on 1 July the company made a bonus (capitalisation) issue of one share for every four in issue at the time, using the share premium account for the purpose.
Which of the following correctly states the company's share capital and share premium account at 31 December 20X0?
Share capital Rs. 7,50,000 Share premium account Rs.2,30,000
Share capital Rs. 8,75,000 Share premium account Rs.2,85,000
Share capital Rs. 7,50,000 Share premium account Rs.3,10,000
Share capital Rs. 7,50,000 Share premium account Rs.6,10,000
According to the illustrative financial structure in IAS 1 Presentation of financial statements, where should dividends paid during the year should be disclosed?
Statement of profit or loss and other comprehensive income
Statement of changes in equity
Statement of financial position
None of these
At 31 December 20X4 a company's capital structure was as follows:
$
Ordinary share capital (500,000 shares of 25c each)125,000
Share premium account100,000
In the year ended 31 December 20X5 the company made a rights issue of one share for two held at $1 per share and this was taken up in full.
Later in the year the company made a bonus issue of one share for every five held, using the share premium account for the purpose.
What was the company's capital structure at 31 December 20X5?
Ordinary share capital: $225,000 Share premium account: $325,000
Ordinary share capital: $450,000 Share premium account: $25,000
Ordinary share capital: $2,12,500 Share premium account: $2,62,500
Ordinary share capital: $225,000 Share premium account: $250,000
Which of the following should appear in a company's statement of changes in equity?
(1) Total comprehensive income for the year
(2) Amortisation of capitalised development costs
(3) Surplus on revaluation of non-current assets
1 and 2 only
2 and 3 only
1 and 3 only
1, 2 and 3
A business has compiled the following information for the year ended 31 October 20X2:
$
Opening inventory - 386,200
Purchases - 989,000
Closing inventory - 422,700
The gross profit as a percentage of sales is always 40%
Based on these figures, what is the sales revenue for the year?
$1,333,500
$1,587,500
$2,381,250
The sales revenue figure cannot be calculated from this information
Which of the following calculations could produce an acceptable figure for a trader’s net profit for a period if no accounting records had been kept?
Closing net assets plus drawings minus capital introduced minus opening net assets
Closing net assets minus drawings plus capital introduced minus opening net assets
Closing net assets minus drawings minus capital introduced minus opening net assets
Closing net assets plus drawings plus capital introduced minus opening net assets
A sole trader fixes his prices to achieve a gross profit percentage on sales revenue of 40%. All his sales are for cash. He suspects that one of his sales assistants is stealing cash from sales revenue.
His trading account for the month of June 20X3 is as follows:
$
Recorded sales revenue 181,600
Cost of sales 114,000
Gross profit 67,600
Assuming that the cost of sales figure is correct, how much cash could the sales assistant have taken?
$5,040
$8,400
$22,000
It is not possible to calculate a figure from this information
A is a sole trader who does not keep full accounting records. The following details relate to her transactions with credit customers and suppliers for the year ended 30 November 20X3.
$
Trade receivables, 1 December 20X2 - 130,000
Trade payables, 1 December 20X2 - 60,000
Cash received from customers - 686,400
Cash paid to suppliers - 302,800
Discounts allowed - 1,400
Discounts received - 2,960
Irrecoverable debts - 4,160
Amount due from a customer who is also a supplier offset against an amount due
for goods supplied by him - 2,000
Trade receivables, 30 November 20X3 - 181,000
Trade payables, 30 November 20X3 - 84,000
Based on the above information, what figure should appear in A’s statement of profit or loss for the year ended 30 November 20X3 for sales revenue?
$748,960
$748,800
$744,960
$743,560
A is a sole trader who does not keep full accounting records. The following details relate to her transactions with credit customers and suppliers for the year ended 30 November 20X3.
$
Trade receivables, 1 December 20X2 - 130,000
Trade payables, 1 December 20X2 - 60,000
Cash received from customers - 686,400
Cash paid to suppliers - 302,800
Discounts allowed - 1,400
Discounts received - 2,960
Irrecoverable debts - 4,160
Amount due from a customer who is also a supplier offset against an amount due
for goods supplied by him - 2,000
Trade receivables, 30 November 20X3 - 181,000
Trade payables, 30 November 20X3 - 84,000
What figure should appear in A’s statement of profit or loss for the year ended 30 November 20X3 for purchases?
$283,760
$325,840
$329,760
$331,760
A fire on 30 September 20X2 destroyed some of a company’s inventory and its inventory records.
The following information is available:
$
Inventory 1 September 20X2 318,000
Sales for September 20X2 612,000
Purchases for September 20X2 412,000
Inventory in good condition at 30 September 20X2 214,000
Standard gross profit percentage on sales is 25%
Based on this information, what is the value of the inventory lost?
$96,000
$271,000
$26,400
$57,000
A business’s bank balance increased by $750,000 during its last financial year. During the same period it issued shares of $1 million and repaid a loan note of $750,000. It purchased non-current assets for $200,000 and charged depreciation of $100,000. Working capital (other than the bank balance) increased by $575,000.
What was its profit for the year?
$1,175,000
$1,275,000
$1,325,000
$1,375,000
A sole trader’s business made a profit of $32,500 during the year ended 31 March 20X8. This figure was after deducting $100 per week wages for himself. In addition, he put his home telephone bill through the business books, amounting to $400 plus sales tax at 17.5%. He is registered for sales tax and therefore has charged only the net amount to his statement of profit or loss and other comprehensive income.
His capital at 1 April 20X7 was $6,500.
What was his capital at 31 March 20X8?
$33,730
$33,800
$38,930
$39,000
Senji does not keep proper accounting records, and it is necessary to calculate her total purchases for the year ended 31 January 20X3 from the following information:
$
Trade payables: 31 January 20X2 - 130,400
31 January 20X3 - 171,250
Payment to suppliers - 888,400
Cost of goods taken from inventory by Senji for her personal use - 1,000
Refunds received from suppliers - 2,400
Discounts received - 11,200
What is the figure for purchases that should be included in Senji’s financial statements?
$914,650
$937,050
$939,050
$941,850
Aluki fixes prices to make a standard gross profit percentage on sales of 20%.
The following information for the year ended 31 January 20X3 is available to compute her sales total for the year.
$
Inventory: 1 February 20X2 243,000
31 January 20X3 261,700
Purchases 595,400
Purchases returns 41,200
What is the sales figure for the year ended 31 January 20X3?
$669,375
$702,600
$772,375
$741,480
Alpha is a sole trader who does not keep proper accounting records.
Alpha’s first year of trading was 20X4. From reviewing Alpha’s bank statements and the incomplete records relating to cash maintained, the following summary has been compiled.
Bank and cash summary, Alpha, 20X4
$
Cash received from credit customers and paid into the bank 381,600
Expenses paid out of cash received from credit customers before banking 6,800
Cash sales 112,900
Other information, Alpha, 20X4
Irrecoverable debts written off 7,200
Discounts allowed to credit customers 9,400
Closing balance of Trade receivables 0
Which of the following correctly represents Alpha’s sales figure for 20X4?
$517,900
$112,900
$381,600
$510,900
A sole trader who does not keep full accounting records wishes to calculate her sales revenue for the year.
The information available is:
1 Opening inventory $17,000
2 Closing inventory $24,000
3 Purchases $91,000
4 Standard gross profit percentage on sales revenue 40%
Which of the following is the sales figure for the year calculated from these figures?
$117,600
$108,000
$210,000
$140,000
On 31 December 20X0 the inventory of V was completely destroyed by fire. The following information is available:
1 Inventory at 1 December 20X0 at cost $28,400
2 Purchases for December 20X0 $49,600
3 Sales for December 20X0 $64,800
4 Standard gross profit percentage on sales revenue 30%
Based on this information, which of the following is the amount of inventory destroyed?
$45,360
$32,640
$40,971
$19,440
The following information is available for the year ended 31 December 20X4 for a trader who does not keep proper accounting records:
$
Inventories at 1 January 20X4 38,000
Inventories at 31 December 20X4 45,000
Purchases 637,000
Gross profit percentage on sales = 30%
Based on this information, what was the trader’s sales figure for the year?
$900,000
$819,000
$920,000
$837,200
Wanda keeps no accounting records. The following information is available about her position and transactions for the year ended 31 December 20X4:
$
Net assets at 1 January 20X4 210,000
Drawings during 20X4 48,000
Capital introduced during 20X4 100,000
Net assets at 31 December 20X4 400,000
Based on this information, what was Wanda’s profit for 20X4?
$42,000
$242,000
$138,000
$338,000
