CIE Accounting Paper-1: Specimen Questions 101 - 103 of 214

Passage

Johnson’s trial balance at 31 March 2015 included the following items:

Trial balance of Johnson as on 31st March 2015

calculate value of the given table.

Particulars

$

Bills payables

15000

Bills receivables

12000

Bank (Dr)

25000

Drawings

28000

Inventory

19000

Provision for depreciation

20000

Question number: 101 (1 of 2 Based on Passage) Show Passage

Short Answer Question▾

Write in Short

Calculate Johnson’s quick ratio with workings

Explanation

1.947: 1

QuickAssets=Billsreceivable+BankInventory

=12000+2500019000

=37000

Quickratio=quickassets/currentliabilities

= 3700015000

1.947:1

Question number: 102 (2 of 2 Based on Passage) Show Passage

Short Answer Question▾

Write in Short

Calculate Johnson’s working capital. Show your workings.

Explanation

$41000

CurrentAssets=Billsreceivable+Bank+Inventory

=12000+25000+19000

=56000

CurrentLiabilites=BillsPayable

=15000

Workingcapital=CurrentAssetsCurrentLiablities

Workingcapital=5600015000

Workingcapital=41000

Question number: 103

MCQ▾

Question

When does a business recognize the expense from a purchase of goods on credit?

Choices

Choice (4) Response
a.

When the goods are ordered by the firm

b.

When the goods are received by the firm

c.

When it receives a statement from the supplier

d.

When the supplier send invoice for the goods

Answer

b.

Explanation

A business recognizes the expense from a purchase of goods on credit when the goods are received by them. The payment of the goods should be made once the goods are received by the customers.

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