A-AS Level (CIE) Accounting Paper-1: Specimen Questions with Answers 62 - 64 of 93

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Question 62

Question

MCQ▾

The following data relate to manufacture of standard product during the month of April, 2019. Units produced and sold during the month is units.

1. Cost of Production

2. Selling and distribution expenses per unit

Profit margin is uniformly made to yield a profit of of the selling price

Choices

Choice (4)

a.

24,00, 000

b.

20,00, 000

c.

42,00, 000

d.

32,00, 000

Answer

a.

Explanation

Profit Margin is Uniformly Made to Yield a Profit of 20 % of the Selling Price
Cost of production18,40, 000
Add: Selling and distribution overheads @ $ 4 per unit80000
Cost of Sales19,20, 000
Profit (20 % on selling price i.e.. , )4,80, 000
Selling Price24,00, 000

Question 63

Question

MCQ▾

What will be the working capital ratio from the following data:

What Will be the Working Capital Ratio from the Following Data
Current Assets470,000
Current Liabilities120,000
Sales4,200, 000

Choices

Choice (4)

a.

12 Times

b.

17 Times

c.

11 Times

d.

14 Times

Answer

a.

Explanation

Question 64

Question

MCQ▾

If Prepaid Wages՚ is given in Trial Balance, it will be shows as what on balance sheet side?

Choices

Choice (4)

a.

Assets

b.

Debit of Trading A/c

c.

Debit of P & L A/C

d.

All of the above

Answer

a.

Explanation

  • Prepaid Expenses or Unexpired Expenses or Expenses paid in advance: These are the expenses which have been paid in advance for the next year during the current year itself. In other words, the benefit of such payments will be available in the next accounting year.
  • Treatment in Final Accounts: Prepaid Expenses on the one hand, will be deducted from the concerned expenses on the debit side of Trading or Profit and Loss Account and on the other hand, will also be shown on the Assets side of the Balance Sheet. Prepaid Expenses is a Personal Account because it represents those persons to whom the payment has been made in advance.

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