Accounting 0452/12 May/June 2023: question paper and mark scheme

Question

What is the main function of book-keeping? A communicating information B interpreting information C recording information D summarising information

Question

Which components of a statement of financial position do descriptions 1, 2 and 3 relate to? 1 finance and other resources that have been provided by the owner 2 money owed for goods supplied, unpaid expenses and loans made to the business 3 property owned by the business, amounts owed by customers, unsold goods and money in the bank 1 2 3 A assets capital liabilities B assets liabilities capital C capital assets liabilities D capital liabilities assets

Question

A cheque received from Kate, a credit customer, was dishonoured. How was this dishonoured cheque recorded? account account debited credited A bank Kate B Kate bank C Kate sales D sales Kate

Question

What does the sales ledger of a business contain? A accounts of trade payables B accounts of trade receivables C sales account D sales ledger control account

Question

Which action is an example of double entry book-keeping? A making a journal entry to record the correction of an error made in the ledger B making entries in the sales journal and the sales ledger to record goods sold on credit C recording a cheque paid to a trade payable in the cash book and purchases ledger D recording the purchase of goods on credit in the purchases journal and purchases account

Question

What is true about cash discounts received? they are they increase recorded in profit for the cash book the year A B C D

Question

Tahir prepared a trial balance. He entered both the balance on the discount allowed account, $900, and the bank overdraft, $750, in the wrong column. Which total of the trial balance was higher and what was the amount of the difference between the debit total and the credit total? amount of total that difference was higher $ A credit column 300 B credit column 1650 C debit column 150 D debit column 3300

Question

Goods sold on credit to J Sharp were debited in error to the account of T Sharpe. Which type of error has been made? A commission B complete reversal C original entry D principle

Question

Khalid made entries in a suspense account to correct two errors found in his ledger accounts. Once the errors were corrected, the suspense account was closed. error 1 $700 sales had been omitted from the sales account. error 2 The purchases journal had been overcast by $550. Which entry was made in the suspense account to balance the trial balance? A credit $150 B credit $1250 C debit $150 D debit $1250

Question

Maya depreciates her motor vehicle at 25% per annum using the straight-line method. The motor vehicle cost $15 000. The depreciation for the current financial year was incorrectly calculated at 15% per annum. How will correcting the error affect the profit for the year? A decrease $1500 B decrease $2250 C increase $1500 D increase $2250

Question

Waseem received a bank statement. He found that the bank had charged interest twice in error and that a dividend had been received on an investment. Waseem then updated the cash book and prepared a bank reconciliation statement. Where did he record these two items? bank error dividend A bank reconciliation statement bank reconciliation statement B bank reconciliation statement updated cash book C updated cash book bank reconciliation statement D updated cash book updated cash book

Question

Thembi is preparing her sales ledger control account. She needs to know: 1 the total for goods which have been returned by credit customers 2 the amount owed by credit customers which have been written off as irrecoverable. Where can she obtain this information? goods returned irrecoverable debts A purchase returns account irrecoverable debts account B purchase returns journal general journal C sales returns account irrecoverable debts account D sales returns journal general journal

Question

On 1 August, the sales ledger control account had a debit balance of $1800. During August, a debt of $200 was written off as irrecoverable and $10 000 was received from credit customers. On 31 August, the credit customers owed $3000. What was the total of credit sales in August? A $7200 B $11 200 C $11 400 D $11 600

Question

A wholesaler had the following transactions. sold goods, $30 000, on credit received cheque, $12 000, from sale of old fixtures at book value How would these amounts be classified? revenue receipt capital receipt $ $ A nil 42 000 B 12 000 30 000 C 30 000 12 000 D 42 000 nil

Question

A trader debited the cost of repairing office equipment to the office equipment account. How did this error affect the financial statements? profit for non-current the year assets A overstated overstated B overstated understated C understated overstated D understated understated

Question

A business bought two assets, X and Y, on 1 January 2022, for $2000 each. It depreciates asset X by 10% per annum using the straight-line method, and asset Y by 10% per annum using the reducing balance method. Which statements are correct? asset X will be fully in 2022 the depreciation depreciated before charge is lower for asset Y asset X than for asset Y A incorrect incorrect B incorrect correct C correct incorrect D correct correct

Question

Ravi’s financial year ends on 30 April. Ravi bought a motor vehicle for $8000 on 1 May 2020 and sold it for $4050 on 1 May 2022. He uses the reducing balance method of depreciation at 20% per annum. What would be recorded in the income statement for the year ended 30 April 2023 for the disposal of the motor vehicle? A $750 loss B $750 profit C $1070 loss D $1070 profit

Question

On 2 January, Razia wrote off $450 owed to her by Annette, a credit customer, as irrecoverable. On 2 October, Annette paid $100 by cheque in part settlement of that debt. Which entries would Razia make on 2 October? account to be debited account to be credited A bank debts recovered B bank irrecoverable debts C debts recovered bank D irrecoverable debts bank

Question

Asha provided the following information about her inventory at the end of the financial year. cost price selling price number product per unit per unit of units $ $ P 200 2.50 2.00 J 300 3.00 3.50 What was the total value of Asha’s inventory? A $1300 B $1400 C $1450 D $1550

Question

Which group contains only service businesses? A book shop, language school, newsagent B jewellery repairer, taxi firm, food store C language school, taxi firm, jewellery repairer D taxi firm, newsagent, food store

Question

What does the statement of financial position of a business show? A assets and liabilities at a certain date B calculation of the annual profit or loss C changes in equity during the financial year D income and expenditure for the financial year

Question

A trader pays her insurance premium on 1 January each year for the following 12 months. She made the following payments for insurance. $ 1 January 2022 1680 1 January 2023 1920 How much did the trader include for insurance in her income statement for the year ended 31 March 2023? A $1680 B $1740 C $1920 D $2160

Question

Which item is added to the profit for the year in a partnership appropriation account? A interest on capital B interest on drawings C partners’ drawings D partners’ salaries

Question

Abi and Erni are in partnership. Erni is entitled to an annual partnership salary of $3000. They share residual profits and losses equally. The profit for the year ended 31 August 2022 was $12 600. On 1 September 2021, the partners’ current account balances were as follows. $ Abi 2500 credit Erni 1400 debit What was the credit balance on Erni’s current account on 1 September 2022? A $400 B $3200 C $6400 D $9200

Question

What is meant by the term equity? A dividend paid to ordinary shareholders B funds raised through borrowing C interest paid to debenture holders D total funds provided by shareholders

Question

During the financial year, AB Limited paid debenture interest of $1400 relating to that financial year. At the end of the year, debenture interest of $700 was accrued. How was debenture interest shown in the financial statements for the year? income statement of statement changes in equity $ $ A 1400 no entry B 2100 no entry C no entry 1400 D no entry 2100

Question

Which items are included in an income and expenditure account prepared for a sports club? 1 cost of new furniture purchased during the year for the clubhouse 2 depreciation on furniture and sports equipment 3 rates for the clubhouse paid in advance for the next financial year 4 subscriptions that remain unpaid by club members at the end of the financial year A 1 and 2 B 1 and 4 C 2 and 4 D 3 and 4

Question

Melody is a music club. The club holds a music concert once every year. Prizes are awarded to musicians selected by a judge. The club provided the following information related to the latest music concert. $ sale of concert tickets 1 500 purchases of concert prizes 450 sale of concert programmes 150 payment of fee to the concert judge 250 What was the profit from the concert? A $950 B $1050 C $1450 D $2100

Question

A business provided the following information. $ opening inventory of raw material 50 000 closing inventory of raw material 60 000 purchases of raw material 80 000 carriage inwards on raw material 2 000 What was the cost of raw material consumed? A $70 000 B $72 000 C $90 000 D $92 000

Question

Ashwin started a business as a taxi driver on 1 January 2022. His taxi cost $5000 and he paid $100 into a business bank account. He did not keep any accounting records. On 31 December 2022, he had $1750 in the business bank account, his taxi was valued at $4000 and he owed $50 to the garage for repairs. During the year, he took $1600 out of the business bank account as drawings. What was the profit for the year? A $1650 B $2200 C $2250 D $3250

Question

A trader did not keep a complete set of accounts. He provided the following information for the year. $ opening trade payables 5 000 closing trade payables 9 800 payments to credit suppliers 35 000 cash discounts received 3 000 What were the purchases for the year? A $30 200 B $36 800 C $39 800 D $42 800

Question

T Limited provided the following information. $ net profit before interest 29 200 profit for the year 28 000 equity at the year-end 192 000 6% debentures 20 000 What was T Limited’s return on capital employed? A 13.21% B 13.77% C 14.58% D 15.21%

Question

Sabelo’s liquid (acid test) ratio was higher on 1 January 2022 than it was on 31 December 2022. What could have caused this? A bank overdraft decreased B inventory decreased C other payables decreased D trade receivables decreased

Question

The following ratios relate to the businesses of Ewa and Max. Ewa Max current ratio 2.2 : 1 2.4 : 1 liquid (acid test) ratio 1.4 : 1 1.0 : 1 An accounting student made the following statements. 1 Ewa can meet her current liabilities from her current assets more easily than Max. 2 Ewa can meet her current liabilities from her liquid assets more easily than Max. 3 Max has insufficient current assets to meet his current liabilities. 4 Max has sufficient liquid assets to meet his current liabilities. Which statements are correct? A 1 and 3 B 1 and 4 C 2 and 3 D 2 and 4

Question

A café owner made no entry in her accounts for increased competition when another café opened nearby. Which accounting principle was applied? A historic cost B materiality C money measurement D prudence