IGCSE Accounting Paper-1: Specimen Questions with Answers 88 - 91 of 214
Question number: 88
Write in Short
Which accounting convention states that understatement of assets and income and overstatement of provisions and liabilities?
Explanation
Convention of conservation
The policy behind the conservation is playing safe. According to this convention least favorable situation to the firm will materialize and necessary action should be taken on that basis of accounting treatments.
Question number: 89
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
Write in Short
Calculate his rate of inventory (stock) turnover in times. Show all your workings.
Explanation
2 times
Question number: 91 (2 of 2 Based on Passage) Show Passage
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: