IGCSE Accounting Paper-2: Specimen Questions with Answers 167 - 169 of 189

Passage

Ankita is a manufacturer. Her financial year ends on 31st March. She sells her output at 30 % mark up.

She provided the following information for the year ended 31st March 2019.

She provided the following information for the year ended 31st March 2019She provided the following information for the year ended 31st March 2019

$

Prime Cost

25000

Factory Overheads

4200

Cost of production

20800

Question number: 167 (5 of 5 Based on Passage) Show Passage

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One Liner Question▾

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Calculate the gross profit for the year ended 31st March 2019. (Marks 1)

Explanation

Ankita is planning to purchase a new machine costing $10,000. Also, she can invest additional capital of $4000.

Question number: 168

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One Liner Question▾

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According to the conservatism principle, a business should value its closing stock a (Marks 1)

Explanation

the lower of cost or market value

  • Conservatism Principle is the policy of playing safe. It says that all the anticipated losses should be provided for and recorded in the books of accounts while the anticipated profits should not be recorded.

  • It also says that the closing stock should be recorded the lower of cost or market value so that the profits may not be overstated.

Question number: 169

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Short Answer Question▾

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What are Limited Liability Companies?

Explanation

  • A Limited Liability Company is US specific form of private limited company. It combines the feature of both of a partnership and that of a limited liability company.

  • An LLC is eligible for the pass through taxation as well as the limiting the liability of the owners.

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