CIE Accounting Paper-1: Specimen Questions with Answers 89 - 92 of 214

Question number: 89

Short Answer Question▾

Write in Short

Give two examples of internal users.

I ……………………………………

II…………………………………………….

Explanation

Owners and Management

The internal users are those individual or may be a group of persons who are within the organization like owners, management, employees and trade unions. The users are determined according to their need of information.

Passage

James’s business had inventory (stock) on 1 July 2014 of $12000 and on 30 June 2014 of $13000. His cost of goods sold for the year ended 30 June 2014 was $25000.

Question number: 90 (1 of 2 Based on Passage) Show Passage

Short Answer Question▾

Write in Short

Calculate his rate of inventory (stock) turnover in days. Show all your workings.

Explanation

2 times

The stock turnover rate may be calculated in days also:

Question number: 91 (2 of 2 Based on Passage) Show Passage

Short Answer Question▾

Write in Short

Calculate his rate of inventory (stock) turnover in times. Show all your workings.

Explanation

2 times

Question number: 92

MCQ▾

Question

Identify the type error involved in the transaction:

Goods of $6000, purchased on credit from Vincent are recorded in the books as $6500.

Choices

Choice (4) Response

a.

Error of recording

b.

Error of posting

c.

Error of casting

d.

Errors of commission

Answer

a.

Explanation

The error arises when transaction is wrongly recorded in the books of original entry. In the above transaction $6000 was wrongly recorded in the books as $6500 which represents overcasting of $500.