Question 11 5 Points A business has a capital account balance of 20,000 (credit) and liabilities of E10,000. The assets of the business, therefore, are: 2,000 B) 120,000 10,000 30,000 Question 12 5 Points Profitability suggests the ability for business opelations to produce profits from trading (sales). Which of the following ratios measure profitability A Current ratio B) Capital Gearing Net profit margin Quick ratio Question 13 5 Points A business had recorded sales of 65,700 for an accounting period. Closing receivables (debtors) for the period were established at E5,580 Average debtors repayment periods, therefore, was: 32 days B 31 days 30 days D) 33 days Question 14 5 Points The double-entry bookkeeping principle requires that A All transactions must be recorded twice to ensure accuracy and to provide full evidence for business verification There will be at least one debit and one credit entry in the business nominal lediger for each transaction recorded. All transactions must be recorded in the business nominal ledger except those transactions between the business and its owner A copy of all business transactions must be forwarded on a monthly basis to the government tax office (HMRCITO facilitate the calculation of tax liability Question 15 5 Points The provision for doubtful debts account is best described as: A note to the accounts describing an amount held as outstanding at the end of an accounting period that will go bad during the following period The sum of all debts outstanding at the end of an accounting period that are more than 90 days old. An amount charged to the bad debts account (usually a proportion of closing receivables) representing a general valut that may go bad during the following period. An amount charged to the bad debts account that, although shown as outstanding at the end of an accounting period. will definitely go bad during the following period Question 16 5 Points A report on the business accounts by judge who will determine and record the legality of business operations. A list of all nominal ledger account balances analysed as the a debitor credit balance an account: of the nominale per to ensure that no transactions have been omitted to the totalt balances prepared to enable money to be collected 5 Points Question 17 Based on the working capital data of Burdock shown below, calculate the quick ratio Inventory Receivables 5,500 2,400 7,900 Payables Bank overdraft 1,100 1,000 (2,100) A) 3.76 B 2.501 C 1.0 X Question 18 5 Points Average debtors repayment period is an efficiency ratio which is calculated using this formula: (closing receivables / sales) x 365 A) True B) False Question 19 5 Points The Suspense account is a temporary nominal ledger account which is used to make the correcting adjustment A True B) False Question 20 5 Points (A) True
