Question No 36:
What is the principal duty of an external auditor?
A. To confirm that financial statements give fair presentation.
B. To ensure that a company’s systems and controls are adequate to ensure the reliability of the accounting records.
C. To prevent fraud and errors.
D. To provide a report to the shareholders.
Answer: A
Thursday, 31 December 2015
Thursday, 17 December 2015
Cima C02 Exam Question No 35
Question No 35:
Which one of the following statements most closely expresses the meaning of “true and fair presentation”?
A. There is only one true and fair presentation of a company’s financial statements.
B. True and fair presentation is determined by compliance with accounting standards.
C. True and fair presentation is determined by compliance with company law.
D. True and fair presentation is largely determined by reference to generally accepted accounting practice.
Answer: A
Which one of the following statements most closely expresses the meaning of “true and fair presentation”?
A. There is only one true and fair presentation of a company’s financial statements.
B. True and fair presentation is determined by compliance with accounting standards.
C. True and fair presentation is determined by compliance with company law.
D. True and fair presentation is largely determined by reference to generally accepted accounting practice.
Answer: A
Thursday, 10 December 2015
Cima C02 Exam Question No 34
Question No 34:
What is the fundamental objective of an external audit of a limited company?
A. Give advice to shareholders.
B. Detect fraud and errors.
C. Measure the performance and financial position of a company.
D. Provide an opinion on the financial statements.
Answer: D
What is the fundamental objective of an external audit of a limited company?
A. Give advice to shareholders.
B. Detect fraud and errors.
C. Measure the performance and financial position of a company.
D. Provide an opinion on the financial statements.
Answer: D
Friday, 20 November 2015
Cima C02 Exam Question No 33
Question No 33:
The following information was extracted from the balance sheets of ABC at 31 December Year 2 and at 31 December Year 1:
Year 1 Year 2
Stock 100 120
Debtors 140 175
Trade creditors 120 140
other creditors 55 75
What figure should appear as part of the cash flow statement for the year ended 31 December 2002?
A. $25,000 outflow
B. $15,000 outflow
C. $15,000 inflow
D. $25,000 inflow
Answer: B
The following information was extracted from the balance sheets of ABC at 31 December Year 2 and at 31 December Year 1:
Year 1 Year 2
Stock 100 120
Debtors 140 175
Trade creditors 120 140
other creditors 55 75
What figure should appear as part of the cash flow statement for the year ended 31 December 2002?
A. $25,000 outflow
B. $15,000 outflow
C. $15,000 inflow
D. $25,000 inflow
Answer: B
Thursday, 12 November 2015
Cima C02 Exam Question No 32
Question No 32:
An increase in inventories of $500 and a decrease in the bank balance of $600 and an increase in payables of $1,400 results in:
A. A decrease in working capital of $1,500
B. An increase in working capital of $1,500
C. A decrease in working capital of $1,300
D. An increase in working capital of $1,300
Answer: A
An increase in inventories of $500 and a decrease in the bank balance of $600 and an increase in payables of $1,400 results in:
A. A decrease in working capital of $1,500
B. An increase in working capital of $1,500
C. A decrease in working capital of $1,300
D. An increase in working capital of $1,300
Answer: A
Thursday, 5 November 2015
Cima C02 Exam Question No 31
Question No 31:
Which ONE of the following formulae correctly expresses the relationship between the return on capital employed (ROCE), net profit margin (NPM) and asset turnover (AT)?
A. ROCE = NPM ÷ AT
B. ROCE = NPM + AT
C. ROCE = NPM x AT
D. ROCE = NPM – AT
Answer: A
Which ONE of the following formulae correctly expresses the relationship between the return on capital employed (ROCE), net profit margin (NPM) and asset turnover (AT)?
A. ROCE = NPM ÷ AT
B. ROCE = NPM + AT
C. ROCE = NPM x AT
D. ROCE = NPM – AT
Answer: A
Thursday, 29 October 2015
Cima C02 Exam Question No 30
Question No 30:
SAD paid $240,000 in net wages to its employees in August. Employees’ tax was $24,000, employees’ national insurance was $12,000 and employer’s national insurance was $14,000. Employees had contributed $6,000 to a pension scheme and had voluntarily asked for $3,000 to be deducted for charitable giving.
What is the amount of wages expense to be charged to the income statement in August?
A. $285,000
B. $293,000
C. $296,000
D. $299,000
Answer: D
SAD paid $240,000 in net wages to its employees in August. Employees’ tax was $24,000, employees’ national insurance was $12,000 and employer’s national insurance was $14,000. Employees had contributed $6,000 to a pension scheme and had voluntarily asked for $3,000 to be deducted for charitable giving.
What is the amount of wages expense to be charged to the income statement in August?
A. $285,000
B. $293,000
C. $296,000
D. $299,000
Answer: D
Wednesday, 21 October 2015
Cima C02 Exam Question No 29
Question No 29:
On the first day of Month 1, a business had prepaid insurance of $10,000. On the first day of Month 8, it paid, in full, the annual insurance invoice of $36,000, to cover the following year.
What is the amount charged in the income statement and the prepayment shown in the statement of financial position at the year end?
IS $ SFP$
A. 5,000 24,000
B. 22,000 23,000
C. 25,000 21,000
D. 36,000 15,000
Answer: D
On the first day of Month 1, a business had prepaid insurance of $10,000. On the first day of Month 8, it paid, in full, the annual insurance invoice of $36,000, to cover the following year.
What is the amount charged in the income statement and the prepayment shown in the statement of financial position at the year end?
IS $ SFP$
A. 5,000 24,000
B. 22,000 23,000
C. 25,000 21,000
D. 36,000 15,000
Answer: D
Thursday, 15 October 2015
Cima C02 Exam Question No 28
Question No 28:
The following information at 5 January year 3 relates to a club, which has a year end of 31 December year 2:
$
Subscriptions for year 1 unpaid at January year 2 300
Subscriptions for year 1 paid during the year ended 31 December year 2 250
Subscriptions for year 2 paid during the year ended 31 December year 2 6,000
Subscriptions for year 3 paid during the year ended 31 December year 2 1,000
Subscriptions for year 2 unpaid at 31 December year 2 750
It is the club’s policy to write off overdue subscriptions after one year.
What amount should be credited to the income and expenditure account for 31 December year 2?
A. $6,250
B. $6,750
C. $7,050
D. $7,250
Answer: B
The following information at 5 January year 3 relates to a club, which has a year end of 31 December year 2:
$
Subscriptions for year 1 unpaid at January year 2 300
Subscriptions for year 1 paid during the year ended 31 December year 2 250
Subscriptions for year 2 paid during the year ended 31 December year 2 6,000
Subscriptions for year 3 paid during the year ended 31 December year 2 1,000
Subscriptions for year 2 unpaid at 31 December year 2 750
It is the club’s policy to write off overdue subscriptions after one year.
What amount should be credited to the income and expenditure account for 31 December year 2?
A. $6,250
B. $6,750
C. $7,050
D. $7,250
Answer: B
Thursday, 8 October 2015
Cima C02 Exam Question No 27
Question No 27:
On 1 June year 1, H paid an insurance invoice of $2,400 for the year to 31 May year 2. What is the charge to the income statement and the entry in the financial statement for the year ended 31 December year 1?
A. $1,000 income statement and prepayment of $1,400.
B. $1,400 income statement and accrual of $1,000.
C. $1,400 income statement and prepayment of $1,000.
D. $2,400 income statement and no entry in the statement of financial position.
Answer: C
On 1 June year 1, H paid an insurance invoice of $2,400 for the year to 31 May year 2. What is the charge to the income statement and the entry in the financial statement for the year ended 31 December year 1?
A. $1,000 income statement and prepayment of $1,400.
B. $1,400 income statement and accrual of $1,000.
C. $1,400 income statement and prepayment of $1,000.
D. $2,400 income statement and no entry in the statement of financial position.
Answer: C
Thursday, 1 October 2015
Cima C02 Exam Question No 26
Question No 26:
The profit of a business may be calculated by using which one of the following formulae?
A. Opening capital - drawings + capital introduced - closing capital
B. Closing capital + drawings - capital introduced - opening capital
C. Opening capital + drawings - capital introduced - closing capital
D. Closing capital - drawings + capital introduced - opening capital
Answer: B
The profit of a business may be calculated by using which one of the following formulae?
A. Opening capital - drawings + capital introduced - closing capital
B. Closing capital + drawings - capital introduced - opening capital
C. Opening capital + drawings - capital introduced - closing capital
D. Closing capital - drawings + capital introduced - opening capital
Answer: B
Wednesday, 23 September 2015
Cima C02 Exam Question No 25
Question No 25:
H began trading on 1 July. The company is now preparing its accounts for the accounting year ended 30 June year 1. Rent is charged for the year from 1 April to 31 March, and was $1,800 for the year ended 31 March year 1 and $2,000 for the year ended 31 March year 2. Rent is payable quarterly in advance, plus any arrears, on 1 March, 1 June, 1 September and 1 December.
The charge to H ‘S income statement for rent for the year ended 30 June year 2 is
A. $1,650
B. $1,700
C. $1,850
D. $1,900
Answer: C
H began trading on 1 July. The company is now preparing its accounts for the accounting year ended 30 June year 1. Rent is charged for the year from 1 April to 31 March, and was $1,800 for the year ended 31 March year 1 and $2,000 for the year ended 31 March year 2. Rent is payable quarterly in advance, plus any arrears, on 1 March, 1 June, 1 September and 1 December.
The charge to H ‘S income statement for rent for the year ended 30 June year 2 is
A. $1,650
B. $1,700
C. $1,850
D. $1,900
Answer: C
Thursday, 17 September 2015
Cima C02 Exam Question No 24
Question No 24:
S purchased equipment for $80,000 on 1 July year 1. The company’s accounting year end is 31 December. It is S‘s policy to charge a full year’s depreciation in the year of purchase. S depreciates its equipment on the reducing balance basis at 25% per annum.
What is the net book value of the equipment at 31 December year 4?
A. Nil
B. $25,312
C. $29,531
D. $33,750
Answer: B
S purchased equipment for $80,000 on 1 July year 1. The company’s accounting year end is 31 December. It is S‘s policy to charge a full year’s depreciation in the year of purchase. S depreciates its equipment on the reducing balance basis at 25% per annum.
What is the net book value of the equipment at 31 December year 4?
A. Nil
B. $25,312
C. $29,531
D. $33,750
Answer: B
Thursday, 10 September 2015
Cima C02 Exam Question No 23
Question No 23:
In July year 1, a company sold goods at VAT rate with a net value of $200,000, goods exempt from VAT with a value of $£50,000 and goods at zero VAT rate with a net value of $25,000.
The purchases in July year 1, which were all subject to VAT, were $161,000, including VAT. Assume that the rate of VAT is 15%.
The difference between VAT input tax and VAT output tax is?
A. Dr £9,000
B. Cr £5,850
C. Cr £9,000
D. None of these
Answer: C
In July year 1, a company sold goods at VAT rate with a net value of $200,000, goods exempt from VAT with a value of $£50,000 and goods at zero VAT rate with a net value of $25,000.
The purchases in July year 1, which were all subject to VAT, were $161,000, including VAT. Assume that the rate of VAT is 15%.
The difference between VAT input tax and VAT output tax is?
A. Dr £9,000
B. Cr £5,850
C. Cr £9,000
D. None of these
Answer: C
Thursday, 27 August 2015
Cima C02 Exam Question No 22
Question No 22:
At the beginning of the year GHI, had opening work-in-progress of $240,000. During the year, the following expenditure was incurred: $ Prime cost 720,000 Factory/production overheads 72,000 Closing work-in-progress 350,000
What was the factory/production cost of goods completed during?
A. $538,000
B. $610,000
C. $682,000
D. $902,000
Answer: C
At the beginning of the year GHI, had opening work-in-progress of $240,000. During the year, the following expenditure was incurred: $ Prime cost 720,000 Factory/production overheads 72,000 Closing work-in-progress 350,000
What was the factory/production cost of goods completed during?
A. $538,000
B. $610,000
C. $682,000
D. $902,000
Answer: C
Thursday, 20 August 2015
Cima C02 Exam Question No 21
Question No 21:
SSG bought a machine for $40,000 in January year 1. The machine had an expected useful life of six years and an expected residual value of $10,000. The machine was depreciated on the straight-line basis where a full year’s charge in made in the year of purchase and none in the year of sale. In December year 4, the machine was sold for $15,000. The company has a policy in its internal accounts of combining the depreciation charge with the profit or loss on disposal of assets. Its year end is 31 December.
What is the total amount of profit/loss charged to the income statement over the life of the machine?
A. $15,000
B. $20,000
C. $25,000
D. $30,000
Answer: C
SSG bought a machine for $40,000 in January year 1. The machine had an expected useful life of six years and an expected residual value of $10,000. The machine was depreciated on the straight-line basis where a full year’s charge in made in the year of purchase and none in the year of sale. In December year 4, the machine was sold for $15,000. The company has a policy in its internal accounts of combining the depreciation charge with the profit or loss on disposal of assets. Its year end is 31 December.
What is the total amount of profit/loss charged to the income statement over the life of the machine?
A. $15,000
B. $20,000
C. $25,000
D. $30,000
Answer: C
Wednesday, 12 August 2015
Cima C02 Exam Question No 20
Question No 20:
Which ONE of the following expenses should be included in prime cost in a manufacturing account?
A. Repairs to factory machinery.
B. Direct production wages.
C. Office salaries.
D. Factory insurance.
Answer: B
Which ONE of the following expenses should be included in prime cost in a manufacturing account?
A. Repairs to factory machinery.
B. Direct production wages.
C. Office salaries.
D. Factory insurance.
Answer: B
Thursday, 6 August 2015
Cima C02 Exam Question No 19
Question No 19:
N purchased a machine for $15,000. The transportation costs were $1,500 and installation costs were $750. The machine broke down at the end of the first month in use and cost $400 to repair. N depreciates machinery at 10% each year on cost, assuming no residual value.
What is the net book value of the machine after one year?
A. $13,500
B. $14,850
C. $15,525
D. $15,885
Answer: C
N purchased a machine for $15,000. The transportation costs were $1,500 and installation costs were $750. The machine broke down at the end of the first month in use and cost $400 to repair. N depreciates machinery at 10% each year on cost, assuming no residual value.
What is the net book value of the machine after one year?
A. $13,500
B. $14,850
C. $15,525
D. $15,885
Answer: C
Thursday, 30 July 2015
Cima C02 Exam Question No 18
Question No 18:
A company bought a machine on 1 October year 1 for $52,000. The machine had an expected life of eight years and an estimated residual value of $4,000. On 31 March year 6, the machine was sold for $35,000. The company’s yearend is 31 December. The company uses the straight-line method for depreciation and it charges a full year’s depreciation in the year of purchase and none in the year of sale.
What is the profit or loss on disposal of the machine?
A. Loss $13,000
B. Profit $7,000
C. Profit $10,000
D. Profit $13,000
Answer: D
A company bought a machine on 1 October year 1 for $52,000. The machine had an expected life of eight years and an estimated residual value of $4,000. On 31 March year 6, the machine was sold for $35,000. The company’s yearend is 31 December. The company uses the straight-line method for depreciation and it charges a full year’s depreciation in the year of purchase and none in the year of sale.
What is the profit or loss on disposal of the machine?
A. Loss $13,000
B. Profit $7,000
C. Profit $10,000
D. Profit $13,000
Answer: D
Wednesday, 29 July 2015
Cima C02 Exam Question No 17
Question No 17:
Which ONE of the following attributes is the most important for any code to possess in order to be of use in an accounting system?
A. Easy to change the code number.
B. Each code is a unique number.
C. A combination of letters and digits to ensure input accuracy.
D. Linked to assets, liabilities, income, expenditure and capital.
Answer: D
Which ONE of the following attributes is the most important for any code to possess in order to be of use in an accounting system?
A. Easy to change the code number.
B. Each code is a unique number.
C. A combination of letters and digits to ensure input accuracy.
D. Linked to assets, liabilities, income, expenditure and capital.
Answer: D
Wednesday, 22 July 2015
Cima C02 Exam Question No 16
Question No 16:
Which of the following are used in a coding system for accounting transactions?
A. Department code.
B. Nominal ledger code.
C. Product code.
D. All of the above.
Answer: D
Which of the following are used in a coding system for accounting transactions?
A. Department code.
B. Nominal ledger code.
C. Product code.
D. All of the above.
Answer: D
Sunday, 12 July 2015
Cima C02 Exam Question No 15
Question No 15:
North, which is registered for sales tax, received an invoice from an advertising agency for $4,000 plus sales tax. The rate of sales tax on the goods was 20%. What would the correct ledger entries be?
Debit $ Credit $
A. Advertising expense 4,000 Payable 4,000
B. Advertising expense 4,800 Payable 4,800
C. Advertising expense 4,800 Payable 4,000 Sales tax account 800
D. Advertising expense 4,000 Payable 4,800 Sales tax account 800
Answer: D
North, which is registered for sales tax, received an invoice from an advertising agency for $4,000 plus sales tax. The rate of sales tax on the goods was 20%. What would the correct ledger entries be?
Debit $ Credit $
A. Advertising expense 4,000 Payable 4,000
B. Advertising expense 4,800 Payable 4,800
C. Advertising expense 4,800 Payable 4,000 Sales tax account 800
D. Advertising expense 4,000 Payable 4,800 Sales tax account 800
Answer: D
Sunday, 5 July 2015
Cima C02 Exam Question No 14
Question No 14:
On 1 May, East owed a supplier $1,200. During the month of May, East: • Purchased goods for $1,700 and the supplier offered a 5% discount for payment within the month. • Returned goods valued at $100 which had been purchased in April. • Sent a cheque to the supplier for payment of the goods delivered in May.
What is the balance on the supplier’s account at the end of May?
A. $1,015
B. $1,100
C. $1,185
D. $1,300
Answer: C
On 1 May, East owed a supplier $1,200. During the month of May, East: • Purchased goods for $1,700 and the supplier offered a 5% discount for payment within the month. • Returned goods valued at $100 which had been purchased in April. • Sent a cheque to the supplier for payment of the goods delivered in May.
What is the balance on the supplier’s account at the end of May?
A. $1,015
B. $1,100
C. $1,185
D. $1,300
Answer: C
Sunday, 28 June 2015
Cima C02 Exam Question No 13
Question No 13:
N operates an imprest system for petty cash. On 1 February, the float was $300. It was decided that this should be increased to $375 at the end of February.
During February, the cashier paid $20 for window cleaning, $100 for stationery and $145 for coffee and biscuits. The cashier received $20 from staff for the private use of the photocopier and $60 for a miscellaneous cash sale.
What amount was drawn from the bank account for petty cash at the end of February?
A. $185
B. $260
C. $315
D. $375
Answer: B
N operates an imprest system for petty cash. On 1 February, the float was $300. It was decided that this should be increased to $375 at the end of February.
During February, the cashier paid $20 for window cleaning, $100 for stationery and $145 for coffee and biscuits. The cashier received $20 from staff for the private use of the photocopier and $60 for a miscellaneous cash sale.
What amount was drawn from the bank account for petty cash at the end of February?
A. $185
B. $260
C. $315
D. $375
Answer: B
Sunday, 21 June 2015
Cima C02 Exam Question No 12
Question No 12:
P is a sole proprietor whose accounting records are incomplete. All the sales are cash sales and during the year $50,000 was banked, including $5,000 from the sale of a business car. He paid $12,000 wages in cash from the till and withdrew $2,000 per month as drawings. The cash in the till at the beginning and end of the year was $300 and $400 respectively.
What were the sales for the year?
A. $80,900
B. $81,000
C. $81,100
D. $86,100
Answer: C
P is a sole proprietor whose accounting records are incomplete. All the sales are cash sales and during the year $50,000 was banked, including $5,000 from the sale of a business car. He paid $12,000 wages in cash from the till and withdrew $2,000 per month as drawings. The cash in the till at the beginning and end of the year was $300 and $400 respectively.
What were the sales for the year?
A. $80,900
B. $81,000
C. $81,100
D. $86,100
Answer: C
Sunday, 14 June 2015
Cima C02 Exam Question No 11
Question No 11:
The entries in a sales ledger control account are:
Sales $250,000
Bank $225,000
Sales returns $2,500
Bad debts (irrecoverable debts?) $3,000
Returned unpaid cheque $3,500
Contra with purchase ledger account $4,000
What is the balance on the sales ledger control account?
A. $12,000
B. $19,000
C. $25,000
D. $27,000
Answer: B
The entries in a sales ledger control account are:
Sales $250,000
Bank $225,000
Sales returns $2,500
Bad debts (irrecoverable debts?) $3,000
Returned unpaid cheque $3,500
Contra with purchase ledger account $4,000
What is the balance on the sales ledger control account?
A. $12,000
B. $19,000
C. $25,000
D. $27,000
Answer: B
Monday, 8 June 2015
Cima C02 Exam Question No 10
Question No 10:
What is an imprest system?
A. Records the use of a company’s seal.
B. Helps to reconcile the cash book with the bank statement.
C. Helps to control petty cash.
D. Is part of computerised accounting?
Answer: C
What is an imprest system?
A. Records the use of a company’s seal.
B. Helps to reconcile the cash book with the bank statement.
C. Helps to control petty cash.
D. Is part of computerised accounting?
Answer: C
Sunday, 31 May 2015
Cima C02 Exam Question No 9
Question No 9:
Z’s bank statement shows a balance of $825 overdrawn. The bank statement includes bank charges of $50, which have not been entered in the cash book. There are unpresented cheques totalling $475 and deposits not yet credited of £600. The bank statement incorrectly shows a direct debit payment of $160, which belongs to another customer.
What figure for the bank balance should be shown in the statement of financial position?
A. $590 overdrawn.
B. $540 overdrawn.
C. $790 overdrawn.
D. $840 overdrawn.
Answer: B
Z’s bank statement shows a balance of $825 overdrawn. The bank statement includes bank charges of $50, which have not been entered in the cash book. There are unpresented cheques totalling $475 and deposits not yet credited of £600. The bank statement incorrectly shows a direct debit payment of $160, which belongs to another customer.
What figure for the bank balance should be shown in the statement of financial position?
A. $590 overdrawn.
B. $540 overdrawn.
C. $790 overdrawn.
D. $840 overdrawn.
Answer: B
Sunday, 24 May 2015
Cima C02 Exam Question No 8
Question No 8:
B operates the imprest system for petty cash. At 1 July there was a float of $150, but it was decided to increase this to $200 from 1 August onwards. During July, the petty cashier received $25 from staff for using the photocopier and a cheque for $90 was cashed for an employee. In July, cheques were drawn for $500 for petty cash.
What was the total expense paid from petty cash in July?
A. $385.
B. $435.
C. $515.
D. $615.
Answer: A
B operates the imprest system for petty cash. At 1 July there was a float of $150, but it was decided to increase this to $200 from 1 August onwards. During July, the petty cashier received $25 from staff for using the photocopier and a cheque for $90 was cashed for an employee. In July, cheques were drawn for $500 for petty cash.
What was the total expense paid from petty cash in July?
A. $385.
B. $435.
C. $515.
D. $615.
Answer: A
Sunday, 17 May 2015
Cima C02 Exam Question No 7
Question No 7:
The core objective of accounting is
A. Provide financial information to the users of such information
B. Maintain records of assets and liabilities
C. Keep record or transactions
D. To fulfil statutory requirements
Answer: A
The core objective of accounting is
A. Provide financial information to the users of such information
B. Maintain records of assets and liabilities
C. Keep record or transactions
D. To fulfil statutory requirements
Answer: A
Sunday, 10 May 2015
Cima C02 Exam Question No 6
Question No 6:
Which ONE of the following best describes the stewardship function?
A. Ensuring high profits.
B. Managing cash.
C. Ensuring the recording, controlling and safeguarding of assets.
D. Ensuring high dividends to shareholders.
Answer: C
Which ONE of the following best describes the stewardship function?
A. Ensuring high profits.
B. Managing cash.
C. Ensuring the recording, controlling and safeguarding of assets.
D. Ensuring high dividends to shareholders.
Answer: C
Sunday, 3 May 2015
Cima C02 Exam Question No 5
Question No 5:
When there is inflation, the historical cost convention has the effect of?
A. Overstating profits and understating statement of financial position values.
B. Understating profits and overstating statement of financial position values.
C. Understating cash flow and overstating cash in the statement of financial position.
D. Overstating cash flow and understating cash in the statement of financial position
Answer: A
When there is inflation, the historical cost convention has the effect of?
A. Overstating profits and understating statement of financial position values.
B. Understating profits and overstating statement of financial position values.
C. Understating cash flow and overstating cash in the statement of financial position.
D. Overstating cash flow and understating cash in the statement of financial position
Answer: A
Sunday, 26 April 2015
Cima C02 Exam Question No 4
Question No 4:
A company includes in inventory goods received before the year end, but for which invoices are not received until after the year end. This is in accordance with
A. The historical cost convention.
B. The accruals concept.
C. The consistency concept.
D. The materiality concept.
Answer: B
A company includes in inventory goods received before the year end, but for which invoices are not received until after the year end. This is in accordance with
A. The historical cost convention.
B. The accruals concept.
C. The consistency concept.
D. The materiality concept.
Answer: B
Sunday, 19 April 2015
Cima C02 Exam Question No 3
Question No 3:
Which one of the following should be accounted for as capital expenditure?
A. Cost of painting a building.
B. The replacement of windows in a building.
C. The purchase of a car by a garage for re-sale.
D. Legal fees incurred on the purchase of a building.
Answer: D
Which one of the following should be accounted for as capital expenditure?
A. Cost of painting a building.
B. The replacement of windows in a building.
C. The purchase of a car by a garage for re-sale.
D. Legal fees incurred on the purchase of a building.
Answer: D
Monday, 13 April 2015
Cima C02 Exam Question No 2
Question No 2:
Which one of the following sentences does NOT explain the distinction between financial accounts and management accounts?
A. Financial accounts are primarily for external users and management accounts are primarily for internal users.
B. Financial accounts are normally produced annually and management accounts are normally produced monthly.
C. Financial accounts are more accurate than management accounts.
D. Financial accounts are audited by management where as management accounts are audited by external auditors.
Answer: D
Which one of the following sentences does NOT explain the distinction between financial accounts and management accounts?
A. Financial accounts are primarily for external users and management accounts are primarily for internal users.
B. Financial accounts are normally produced annually and management accounts are normally produced monthly.
C. Financial accounts are more accurate than management accounts.
D. Financial accounts are audited by management where as management accounts are audited by external auditors.
Answer: D
Thursday, 9 April 2015
Cima C02 Exam Question No 1
Question No 1:
The difference between an income statement and an income and expenditure account is that:
A. An income and expenditure account is an international term for an Income statement.
B. An income statement is prepared for a business and an income and expenditure account is prepared for a not-for-profit making organization.
C. An income statement is prepared on an accruals basis and an income and expenditure account is prepared on a cash flow basis.
D. An income statement is prepared for a manufacturing business and an income and expenditure account is prepared for a non-manufacturing business.
Answer: B
The difference between an income statement and an income and expenditure account is that:
A. An income and expenditure account is an international term for an Income statement.
B. An income statement is prepared for a business and an income and expenditure account is prepared for a not-for-profit making organization.
C. An income statement is prepared on an accruals basis and an income and expenditure account is prepared on a cash flow basis.
D. An income statement is prepared for a manufacturing business and an income and expenditure account is prepared for a non-manufacturing business.
Answer: B
Subscribe to:
Comments (Atom)