A Company Car costs 58,000. It is to be depreciated on a reducing balance basis at a rate of 40% per anum. What is the depreciation charge in year 2? Select one: A. 34,800 B. 20,880 C. 13,920 D. 23,200 How would you best classify the cost of external specialist advice relating to a specific case in a Firm of Solicitors? Select one: A. Indirect Materials B. Indirect Labour C. Direct Overheads D. Direct Labour E. Indirect Overheads F. Direct Materials Which of the following would be considered as advantage of a Partnership compared to a Company? Select one: A. Each partner is liable for all the debts of the partnership B. The liabilities of the partners are limited C. It is simpler to set up D. Perpetual existence In cost classification, Circuit Boards in the manufacture of Laptops would be classified as Select one: A. Semi Variable Cost B. Critical Cost C. Variable Cost D. Fixed Cost Which of the following would be described as Non-Current Asset in the Statement of Financial Position of a Company? 1. Old Machinery 2. Factory Building 3. 25 year Mortgage 4. Out of Date Inventory Select one: a. 1,2 and 3 b. 1,2 and 4 c. 2 and 3 only d. 1 and 2 only Working Capital is a term meaning Select one: A. Non-Current assets less Current Assets B. The amount of capital invested by the proprietor C. The Capital specially reserved for running the business D. Current Assets less Current Liabilities Limited companies are protected from bankruptcy. Select one: True False Which of the following best describes a trial balance? Select one: A. It shows the financial position of a business B. It is a special account C. It shows all the entries in the books D. It is a list of all the balances in the books The following information relates to Bearmach Products Ltd in the year ended 31 st December last year Opening Inventory 32,000 What is the Gross Profit figure for the business? Select one: A. 89,800 B. 202,950 C. 160,200 D. 98,800 How would you classify the cost of window cleaning in a firm of Architects? Select one: A. Direct Overheads B. Direct Labour C. Indirect Labour D. Indirect Overheads Which of the following is a Liability? 1. Old Motor vehicle 2. Trade Payables 3. Cash stolen from the Till 4. Bank overdraft Select one: a. 1 and 4 only b. 1 and 3 only c. 2 and 4 only d. 1,2 and 3 Which of the following best explains why a supplier would be interested in the financial statements of a company? Select one: A. To assess the likely risks and returns in order to determine its investment potential B. To assess the ability of the business to pay for goods and services supplied C. To assess the profitability of the business in order to decide whether to invest in it D. To help them make decisions and plans for the business A Company Car costs 58,000. It is to be depreciated on a reducing balance basis at a rate of 40% per anum. What is the depreciation charge in year 2? Select one: a. 23,200 b. 13,920 c. 34,800 d. 20,880 Which of the following statements is not true? 1. A balanced trial balance produces correct accounts 2. The Balance Sheet is usually over a period of one year 3. Trade payables are a source of finance 4. The Capital Account is for recording transactions of the owner. Select one: a. 3 only b. 1 and 2 only c. None of the above d. 1,2 and 4 only In a computer games manufacturing company, production line staff wages would be classified as Select one: A. Semi Variable Cost B. Variable Cost C. Semi Fixed Cost D. Fixed Cost Depreciation is Select one: A. The amount spent to buy a fixed asset B. The charge to spread the cost of an asset over the estimated useful life. C. The amount of money required to replace the asset D. The Net Book Value of an asset In cost classification, Metered Electricity Bill, part rental and part usage would be classified as Select one: A. Variable Cost B. Critical Cost C. Fixed Cost D. Semi Variable Cost Which of the following were included in the ASB's qualities of good financial information? 1. Relevant 2. Material 3. Balanced 4. In good English Select one: a. All the above b. 1 and 2 only c. 1,2 and 4 only d. 1,2 and 3 only Depreciation is calculated: Select one: A. To show the exact value of each asset B. To revalue assets for sale C. To spread the cost of a fixed asset over its useful life. D. To set aside funds to replace the assets A Sole Trader can issue shares to personal friends Select one: True False Working Capital is a term meaning Select one: A. The amount of capital invested by the proprietor B. Current Assets divided by Current Liabilities C. Current Assets less Current Liabilities D. Non-Current assets less Current Assets How would you classify the cost of office cleaning in a firm of Accountants? Select one: A. Direct Overheads B. Indirect Labour C. Indirect Overheads D. Direct Labour Which of the following is a Liability? 1. Old Motor vehicle 2. Trade Payables 3. Cash stolen from the Till 4. Bank overdraft Select one: A. 1 and 3 only B. 1 and 4 only C. 1,2 and 3 D. 2 and 4 only Which of the following sources of finance is most suitable for buying inventory? Select one: A. Hire Purchase B. Bank Overdraft C. Share Issue D. Building Society Mortgage Trade Receivables are: Select one: A. Customers who owe money to the business B. Customers who pay cash for trade discount C. Trade samples receivable by the business D. Suppliers who have been paid by the business A firm bought equipment costing 46,000. It is expected to last for 4 years, with a salvage value of 2,000. What is the total amount of depreciation charged by the end of the third year, using the straight line method? Select one: a. 34,500 b. 33,000 c. 11,000 d. 44,000 A Company Car costs 58,000. It is to be depreciated on a reducing balance basis at a rate of 40% per anum. What is the net book value at the end of year 3 ? Select one: A. 12,528 B. 20,880 C. 23,200 D. 34,800 In a Firm of Chartered Accountants, the fees of a Partner Accountant would be classified as; Select one: A. Indirect Overheads B. Direct Overheads C. Indirect Labour D. Direct Labour A firm bought a machine for 38,000. It is expected to last for 5 years, with a salvage value of 3,000. What is the amount of depreciation chargeable in the second year, using the straight line method? Select one: A. 7,600 B. 4,200 C. 5,000 D. 7,000 A Company Van costs 35,000. It is to be depreciated on a reducing balance basis at a rate of 30% per anum. What is the net book value at the end of year 3 ? Select one: A. 7,350 B. 10,500 C. 17,150 D. 12,005 Where there is Inelastic Demand which of the following statements are true? 1. Demand is insensitive to price 2. An increase in price causes a smaller percentage fall in demand 3. There are many substitutes Select one: A. 2 and 3 only B. 1 only C. 1,2 , and 3 D. 1 and 2 only In a toy manufacturing company, annual insurance of the factory building would be classified as: 1.Direct Materials 2. Direct Overheads 3. Indirect Materials 4. Indirect Overheads 5. Fixed Cost 6. Variable Cost Select one: A. (3 and 6) B. (2 and 5) C. (3 and 6) D. (2 and 6) E. (4 and 5) F. (1 and 5) In a clothing manufacturing factory, fabric for the production of Jeans would be classified as: 1.Direct Materials 2.Direct Overheads 3. Indirect Materials 4. Indirect Overheads 5. Fixed Cost 6.Variable Cost Select one: A. (2 and 6) B. (3 and 5) C. (1 and 6) D. (1 and 5) E. (2 and 5) F. (3 and 6) Company Equipment costs 40,000. It is to be depreciated on a reducing balance basis at a rate of 20% per anum. What is the net book value at the end of year 2 ? Select one: a. 8,000 b. 32,000 c. 6,400 d. 25,600 In a Factory producing smart watches, the salary of a store assistant would be classified as; Select one: A. Indirect Labour B. Direct Overheads C. Direct Labour D. Indirect Overheads Which of the following are characteristics of the Public Limited Company? 1. Limited liability 2. Listing on a Stock Exchange 3. Separate legal entity 4. Ownership by shareholding Select one: A. 1,2 and 3 only B. All of the above C. 2, 3, and 4 only D. 1,3 , and 4 only A Van costs 18,000. It is to be depreciated on a reducing balance basis at a rate of 20% per anum. What is the book value of the car at the end of 3 years? Select one: A. 2,304 B. 11,520 C. 14,400 D. 9,216 Which of the following statements are true of Variable Cost Pricing: 1. Only considers marginal cost 2. Ensures that you cover total costs 3. Covers Fixed Costs 4. An example is Late discounted flight bookings: Select one: A. 4 anly B. 1,2 , and 4 C. 2 and 4 only D. 1 and 4 only Solid State Itd sells laptop computers for 580 each. It costs the company 250 to purchase. What is the Profit Margin of Solid State Ltd? Answer: Depreciation is Select one: A. The amount of money required to replace the asset B. The amount spent to buy a fixed asset C. The Net Book Value of an asset D. The part of the asset 'consumed' during the period of use A. Public Limited Corporation B. Private Limited Company C. Public Liability Company D. Public Limited Company Which of the following is an expense in the Income Statement? Select one: A. Telephone Equipment B. Business Insurance C. Purchase of a car D. Loan repayment Which of the following best explains why the government would be interested in the financial statements of a company? Select one: A. To assess the effect of the business on the local economy, community and environment B. To assess the profitability of the business in order to decide whether to invest in it C. To extract data for statistical purposes. D. To compare the business with its competitors to determine if its profitability can be improved Trade Payable is Select one: A. Current monies owed by our customers B. Amount payable from traders C. Amount we owe to our suppliers D. A Non-Current Liability Select an example of Short Term Funds for a Company. Select one: A. Share issue B. Finance Lease C. Invoice Factoring D. Debentures A Company Car costs 18,000. It is to be depreciated on a reducing balance basis at a rate of 40% per anum. What is the depreciation charge in year 2 ? Select one: A. 14,400 B. 6,480 C. 4,320 D. 7,200 A Van costs 26,000. It is to be depreciated on a reducing balance basis at a rate of 40% per anum, What is the book value of the car at the end of 2 years? Select one: A. 15,600 B. 9,360 C. 10,400 D. 6,240 Non-Current Assets are assets which are: Select one: A. Out of date B. Unlikely to last a year C. Expected to last more than 12 months D. Fully depreciated The UK Regulatory Framework for Accounting derives from which of the following? 1. Company law 2. Accounting standards and financial reporting standards 3. International accounting and financial reporting standards. 4. Stock Exchange requirements Select one: a. All of the above b. 1 only c. 1 and 2 only d. 3 and 4 only The income statement is a snapshot of profit at a point in time. Select one: True False