0452 w06 QP 1
0452 w06 QP 1
0452 w06 QP 1
com
ACCOUNTING 0452/01
Paper 1 Multiple Choice
October/November 2006
1 hour
Additional Materials: Multiple Choice Answer Sheet
Soft clean eraser
Soft pencil (type B or HB is recommended)
There are forty questions on this paper. Answer all questions. For each question there are four possible
answers A, B, C and D.
Choose the one you consider correct and record your choice in soft pencil on the separate Answer Sheet.
Each correct answer will score one mark. A mark will not be deducted for a wrong answer.
Any rough working should be done in this booklet.
Calculators may be used.
1 Why should a trader record all the financial information about her business?
A petty cash
B rented premises
C trade creditors
D trade debtors
4 A trader provides the following information for the year ended 31 August 2006.
sales 80 000
cost of sales 50 000
net profit 14 000
What are the expenses for the year ended 31 August 2006?
7 Which accounting principle states that two accounting entries are required for each financial
transaction?
A consistency
B duality
C matching
D money measurement
8 Aziz owns a shoe shop. Another shoe shop opens nearby. Aziz thinks this will reduce his sales
and his profit, but he does not enter this in his accounting records.
A business entity
B going concern
C matching
D money measurement
A credit note
B debit note
C invoice
D statement
10 Which business document contains details of purchases, returns and payments occurring during
a trading period?
A credit note
B debit note
C invoice
D statement
11 What is the accounting treatment for trade discount and cash discount allowed to a customer?
12 The list price of a product is $10 000 and a trade discount of 20 % is given to the customer.
The customer pays his invoice within 14 days and is allowed a cash discount of 5 %.
13 Which is both a book of prime (original) entry and a part of the ledger?
A cash book
B journal
C purchases journal
D sales journal
14 A trader buys a motor vehicle, for use in his business, on credit from J. Sango.
A credit $1400 –
B debit $1400 –
C – credit $1400
D – debit $1400
During August Marie purchases goods, $260, from Yvonne and pays Yvonne $137.
A purchases
B purchases returns
C XY – a supplier
D WZ – a customer
dr cr
$ $
John 300
Jane 300
Correction of error
21 A trial balance does not balance and a suspense account is opened. It is found that a sale of
$250 was credited in the sales account as $2500.
22 Which item on a bank statement would cause the balance to be more than the balance in the
cash book?
A bank charges
B bank interest credited
C dishonoured cheque
D standing orders paid
23 On 1 January 2005 a trader owes $200 for electricity in respect of 2004. During 2005, she pays
$5000 for electricity. On 31 December 2005 she owes $600 for electricity.
How much will be shown for electricity in the Profit and Loss Account for the year ended
31 December 2005?
24 When preparing the final accounts for the year ended 31 December 2005 no adjustment was
made for rent paid for January 2006.
A overstated understated
B overstated overstated
C understated overstated
D understated understated
A It increases profit.
B It reduces profit.
C It extends the life of fixed assets.
D It increases the cash balance.
28 Plant and machinery cost $40 000. Depreciation is charged at 20 % per annum on the reducing
(diminishing) balance method.
29 A trader sold goods to Zahid on credit. Zahid failed to pay the amount owing and was written off
as a bad debt.
What entries will the trader make to write off this bad debt?
30 A trader provides the following information about her only two items of stock on 31 May 2006.
X $24 $20 –
Y $22 $25 $6
What will be the value of the total stock in the final accounts for the year ended 31 May 2006?
33 Sarah and Jane are in partnership. They provide the following information for the year ended
30 September 2006.
$ $
What is the net profit of the partnership for the year ended 30 September 2006?
What will it use to calculate the profit or loss for the year?
A bank statement
B cash book
C purchases and sales invoices
D statement of affairs
What were the credit sales for the year ended 31 December?
A accrued wages
B bank loan
C motor vehicles at cost
D prepaid insurance
A current ratio
B quick ratio
C return on capital employed
D working capital
year 1 year 2
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University of Cambridge International Examinations is part of the University of Cambridge Local Examinations Syndicate (UCLES), which is itself a department
of the University of Cambridge.
0452/01/O/N/06