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Cima C02 Exam Question No 42

Question No 42:

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?
 

 Answer: D

Cima C02 Exam Question No 41

Question No 41:

B made an issue of 150,000 $1 ordinary shares at a premium of 20% the proceeds of which is received by cheque. What is the correct journal to record this?

Answer: A

Cima C02 Exam Question No 40

Question No 40:

An error of commission occurs where the entries required for a transaction are partially omitted.

A. True
B. False

Answer: B

Cima C02 Exam Question No 39

Question No 39:

Which of the following errors will cause the trial balance totals to be unequal?

A. Errors of transposition.
B. Errors of omission.
C. Errors of principle.
D. All of the above.

Answer: A

Cima C02 Exam Question No 38

Question No 38:

Which of the following best describes the role of the internal auditor?

A. Auditing the financial accounts.
B. Supporting the work of the external auditors.
C. Reporting to management on the accounting systems.
D. Ensuring value for money.

Answer: C

Cima C02 Exam Question No 37

Question No 37:

Which ONE of the following provides the best explanation of the objective of an internal audit?

A. The objective is to assist directors of a company in the effective discharge of their financial responsibilities towards the members.
B. The objective is to provide support to the external auditor.
C. The objective is to detect fraud and error.
D. The objective is to audit the financial statements.

Answer: A