CIE Accounting Paper-1: Specimen Questions with Answers 131 - 133 of 214

Question number: 131

Short Answer Question▾

Write in Short

Fixed assets are shown at their net book value in the balance sheet. Explain how will you ascertain the net book value of the fixed assets?

Explanation

Fixed assets are always shown at the net book value of the firm in their balance sheet. Net book value can be ascertained by deducting the accumulated depreciation from the cost of an fixed assets. Hence

Question number: 132

MCQ▾

Question

When will a business issue a credit note?

Choices

Choice (4) Response

a.

When goods are returned by a customer

b.

When goods are received from a supplier

c.

When goods are sent to a customer

d.

When goods are received from customer

Answer

a.

Explanation

Credit note is prepared by the seller when goods are returned by the customer. The credit note consist of

  • The date on which goods are returned
  • The name of the customer
  • The details of the goods returned
  • The amount of such goods etc. ,

Question number: 133

MCQ▾

Question

Which asset is termed as floating assets?

Choices

Choice (4) Response

a.

Liquid Asset

b.

Non- Current Asset

c.

Current Asset

d.

Fixed Asset

Answer

c.

Explanation

The assets which are easily converted into cash are known as current assets. These current assets are also termed as floating assets. This assets includes Cash in hand, cash at bank, sundry debtors and bills receivable etc. ,