CIE Accounting Paper-1: Specimen Questions with Answers 25 - 27 of 214

Question number: 25

MCQ▾

Question

Which concept ensures that the profit or loss shown is on the basis of full facts relating to all expenses and incomes?

Choices

Choice (4) Response

a.

Accrual Concept

b.

Matching Concept

c.

Cost Concept

d.

Periodicity Concept

Answer

a.

Explanation

Under accrual concept ensures that the profit or loss shown is on the basis of full facts relating to all expenses and incomes. This concept reveals the difference between the receipt of cash and the right to receive cash.

Question number: 26

MCQ▾

Question

How amount of depreciation is calculated?

Choices

Choice (4) Response

a.

b.

c.

d.

Answer

b.

Explanation

The asset’s life time can be estimated and wear or tear of the tangible assets are known as depreciation of the assets. This is a permanent decline in the value of the assets and reflects in the balance sheet.

Question number: 27

MCQ▾

Question

Which entries are made in Antony’s ledger to record the goods returned by James?

Choices

Choice (4) Response

a.

Antonys ledger account is given.

Here account detail is given.

account to be debited account to be credited

account to be debited account to be credited

James

Sales

b.

Antonys ledger account is given in this table.

Here account detail is given.

account to be debited account to be credited

account to be debited account to be credited

James

Purchase return

c.

Antonys ledger account

Here account detail is given.

account to be debited account to be credited

account to be debited account to be credited

Sales return

James

d.

The antonys ledger account is given in this table.

Here account detail is given.

account to be debited account to be credited

account to be debited account to be credited

Purchase

James

Answer

c.

Explanation

Goods which are returned by their customers were recorded in this type of book. Monthly totals of the sales return books shows the data on sales returns. These transactions took place only when there is a credit sale among the parties.