IGCSE Accounting Paper-1: Specimen Questions with Answers 258 - 261 of 338

Passage

Shri Ram maintains a columnar Petty Cash Book on the imprest system. The imprest amount is $10. From the following information, show how his petty cash book would appear for the month of October 2019.

Shri Ram maintains a columnar Petty Cash Book on the imprest system. Shri Ram maintains a columnar Petty Cash Book on the imprest system.
1 - 10 - 2019Balance in hand$2
Received Cash to make up the imprest
Bought Printing Papers$1
8 - 10 - 2019Miscellaneous Expenses$1
10 - 10 - 2019Repairs$2
13 - 10 - 2019Travelling$1
17 - 10 - 2019Stamps$1
30 - 10 - 2019Miscellaneous Expenses$2
Repairs$1

Question 258 (2 of 2 Based on Passage)

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Write in Brief

One Liner▾

State the amount required to restore the imprest on 1stOctober 2019

________ (Marks 1)

Explanation

The imprest amount is $10 while the opening balance of petty cash is $2. So Shri Ram needs to restore the imprest.

Question 259

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Question

MCQ▾

Mr. Vishal started business with $1000. He purchased goods for $400, furniture for $200 and plant & machinery of $300 and $100 remains in hand. What would be the assets of the business?

Choices

Choice (4)
a.$1900
b.$2000
c.$900
d.$1000

Answer

d.

Explanation

Question 260

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Write in Short

Short Answer▾

(I) State one merit of sole proprietorship form of business.

________

(II) State one demerit of company form of business.

________

Explanation

  • Sole Profit Earner: The sole proprietor is the only owner of his business. Whatever profit the business earns goes to his pocket only. He does not share the profits with anybody. This motivates people to take this form of business at the first.
  • Many Legal Restrictions: It is not easy to open a company form of business. One has to fulfil many legal requirements to register a company. This takes a lot of time and effort.

Question 261

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Question

MCQ▾

On applying money measurement concept, which of the following should not be recorded in the books of accounts?

Choices

Choice (4)
a.Purchase of materials from suppliers
b.Appointment of a new employee
c.Payment of rent to landlord
d.Sale of goods to customers

Answer

b.

Explanation

  • Money Measurement Concept says that only those events which can be measured in terms of money should be recorded in the books of accounts.
  • Events like sale or purchase of goods, payment of wages to labourers, payment of rent to landlord, purchase of any asset, deposit or withdrawal cash from business’ bank account etc. are measurable in terms of money so these should be accounted for.
  • On the contrary, appointment of a new employee, skills of managers, creativity of workers etc. should not be recorded in the accounts.

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