IGCSE Accounting Paper-1: Specimen Questions with Answers 11 - 13 of 338

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Question 11

Question

MCQ▾

Which would appear in an income statement?

Choices

Choice (4)

a.

Trade payables

b.

Bank

c.

Drawings

d.

Cost of Goods Sold

Answer

d.

Explanation

The carrying value of the goods which are going to be sold during the accounting year is known as cost of goods sold.

Question 12

Question

MCQ▾

Anything owned by or owed to the business ________

Choices

Choice (4)

a.

Liabilities

b.

Assets

c.

Capital

d.

Question does not provide sufficient data or is vague

Answer

b.

Explanation

Anything owned by or owed to the business are known as assets.

It shows the fixed as well as fluctuated assets of the company.

Capital is an amount introduced or invested by the shareholder of the company.

Question 13

Question

MCQ▾

When a claim against a debtor becomes irrecoverable it is called bad debt.

How is this recorded in the ledger?

Choices

Choice (4)

a.

Debit Bad debts, credit Creditor՚s

b.

Debit Bad debts, credit Debtor՚s

c.

Debit Creditors, credit Bad Debts

d.

Debit Debtor՚s, credit Bad debts

Answer

b.

Explanation

When a claim against a debtor becomes irrecoverable it is called bad debt. Bad debts is always shown on the debit side of Profit and Loss account and also deducted from the debtors in the balance sheet.

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