MULTIPLE CHOICE (20 MARKS)

REQUIRED

For each of the questions below write down only the letter of the most appropriate answer e.g. 1.11 C. Note: Calculations must not be shown in your answer book.

1.5 Which of the following accounts increase by means of a debit entry in the ledger?

. A Vehicles and Stationery

. B Capital and Investments

. C Rent income and Loan

. D Equipment and Creditors control

.

1.6 The advertising account of Skype Stores included an amount of R1 200 that was paid for advertising for the period 01 November 2015 to 31 October 2016. Which of the following alternatives represent the correct double entry to record the required adjustment on29 February 2016, the end of the financial year?

The following information was extracted from the books of Munster Wholesalers on 30 September 2015:

	Account debit	Account credit	Amount (R)
A	Accrued expenses	Advertising	R800
B	Prepaid expenses	Advertising	R400
C	Prepaid expenses	Advertising	R800
D	Advertising	Prepaid expenses	R800

1.7

September		Units of inventory	Unit Cost price
01 15 18 30	Opening inventory Purchases PurchasesSales for September	5 000 20 000 2 000 24 000	R20 R21 R22

The value of inventory on 30 September 2015, using the first-in-first-out method, is ________.

. A R66 000

. B R60 000

. C R65 000

. D none of the above

.

1.8 Simplex Stores received R720 from a debtor who was declared insolvent. This amount equals 60% of the total debt. If the balance of the debtors account is written off, the bad debt will amount to ___.

. A R480

. B R1 080

. C R432

. D none of the above.

1.9 The following balances appeared in the books of Tredwell Stores on 29 February 2016, the end of the financial year:

(3)

	R
Purchases	384 000
Sales	888 000
Opening inventory	60 000
Closing inventory	72 000
Carriage on purchases	30 000

The gross profit for the year ended 29 February 2016 is _____________.

. A R344 000

. B R486 000

. C R462 000

. D none of the above

(3)

1.10 The post-closing trial balance of Bendit Traders on 29 February 2016 included the following balances:

	R
Bank (CR balance)	60 000
Debtors control	80 000
Creditors control	100 000
Accrued expenses	14 000
Petty cash	2 000
Accrued income	6 000
Income received in advance	4 000
Prepaid expenses	8 000
Current portion of long-term borrowings	40 000

The current liabilities of Bendit Traders on 29 February 2016 amount to __________.

. A R218 000

. B R158 000

. C R178 000

. D none of the above