IGCSE Accounting Paper-1: Specimen Questions with Answers 284 - 285 of 338

Question number: 284

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MCQ▾

Question

Which of the following item would appear on the debit column of Trial Balance? (Marks 1)

Choices

Choice (4)

a.

Purchases Returns

b.

Bad debts

c.

Provision for Bad debts

d.

Trade Payables

Answer

b.

Explanation

  • Bad debts are that part of receivables which become irrecoverable because of bankruptcy of debtors etc. Bad debts is in nature of a loss/expense. So, it has a debit balance.

  • Purchases Returns reduces purchases. It is a contra purchases A/c so it has a credit balance.

  • Provision for bad debts is contra asset (receivables) a/c so it has a credit balance.

  • Trade Payable represents amount owed by the business to its credit suppliers of goods or services. It is a liability so it has a credit balance.

Question number: 285

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MCQ▾

Question

ABC Ltd. provides the following information: (Marks 1)

ABC Ltd. provides the following informationABC Ltd. provides the following information

$

Machinery

80000

Patent

30000

Stock

15000

Furniture

20000

Equipment

30000

Prepaid Expenses

2000

What is the total tangible fixed assets?

Choices

Choice (4)

a.

$167000

b.

$130000

c.

$197000

d.

$160000

Answer

b.

Explanation

Note-

Patent is an intangible fixed asset.

Stock and Prepaid Expenses are current assets.

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