• Question 11

  Complete the gaps in the following statement.

  The IFRS Foundations Mission Statement states: Our mission is to develop International Financial Reporting Standards that bring _____________, accountability and efficiency to financial markets around the world. Our work serves the _____________ interest by fostering trust, growth and long-term financial stability in the global economy.

  1. transparency, public

  2. reliability, organisations

  3. stability, government

  4. accuracy, companies

• Question 12

  Examine Jack's sales ledger summary below:

• The closing total sales ledger balance (i.e. Balance c/fwd), therefore, is:

  1. 5,840

  2. 3,400

  3. 3,490

  4. 3,440

• Question 13

  The depreciation charge to the business income statement is an example of:

  1. Revenue income

  2. Revenue expenditure

  3. Capital income

  4. Capital expenditure

• Question 14

  For an accounting period, a business had sales of 25,000. Opening inventory was valued at 1,260 and closing inventory, 1,380. Purchases for the period were 14,000 (of which 130 worth was return unsatisfactory). Gross Profit for the period, therefore, were:

  1. 13,750

  2. 11,250

  3. 11,500

  4. 13,700

• Question 15

  Closing inventory (i.e. unsold purchases at the end of an accounting period) is accounted for as a current asset because:

  1. Profits would be increased if closing inventory were treated as an income and this would be in breach of the prudence principle of accounting.

  2. Of the money measurement (cash basis) principle of accounting.

  3. Of the matching (accruals) principle of accounting.

  4. Closing inventory could only be accounted for as an income if its value was zero or less.

• Question 16

  A specific debt is written off at the end of one period of account but is repaid in full during the following accounting period. The journal entry required to account for the payment is:

  1. Debit Bank a/c: Credit Bad debts account

  2. Debit Bad debts a/c: Credit Sales a/c

  3. Debit Bad debts a/c: Credit Bank a/c

  4. Debit Bank a/c: Credit Sales a/c

• Question 17

  The opening balance on the fixed assets (NBV) account was 26,000. During the following period of account, a fixed asset costing 4,800 was acquired and an old fixed asset with an NBV of 1,600 was disposed. The closing balance on the fixed assets NBV account is 26,400. Depreciation for the year, therefore, was:

  1. 2,500

  2. 2,800

  3. 3,000

  4. 3,800