ACC204
Question: A business purchased a motor car on 1 July 2018 for $20,000. It is to be depreciated at 20 per cent per year\non the straight line basis, assuming a residual value at the end of five years of $4,000, with a proportionateVndepreciation charge in th^ year of purchase.\nThe $20,000 cost was correctly entered in the cash book but posted to the debit of the motor vehicles\nrepairs accountAnHow will the business profit for the year ended 31 December 2018 be affected by the error?
Answer: Understated by $18,400
Question: The profit earned by a business in 2017 was $72,500. The proprietor injected new capital of $8,000 during\nthe year and withdrew goods for his private use which had cost $2,200.\nlf net assets at the beginning of 2017 were $101,700, what were the closing net assets?
Answer: 16840
Question: Given the following 1. Cash refunde due to customer A was correctly treated in the cash book and then credited to the\naccounts receivable ledger account of customer BAn2. The sale of goods to a director for $300 was recorded by debiting sales revenue account and\ncrediting the directorYs current account.\n3. The total nf the discount received column in the cas i book had been credited in error to the discount\nallowed account.\n4. Some of the cash received from customers had beei used to pay sundry expenses before banking\nthe money.\n5. $5,800 paid fc plant repairs was correctly treated in the cash book and then credited to plant and\nequipment asset accountAnWhich Y the above errors would require an entry to the suspense account as part of the prc 3So of\ncorrecting them?
Answer: 1 and 5
Question: A sole traderVs business made a profit of $32,500 during the year ended 31 March 2018. This figure was\nafter deducting $100 per week wages for himself. In addition, he put his home telephone bill through the\nbusiness books, amounting to $400 plus sales tax at 17.5%. He is registered for sales tax and therefore has\ncharged only the net amount to his statement of comprehensive incomeAnl is capital at 1 April 2017 was $6,500. Whc was his capital at 31 March 2018?
Answer: 38930
Question: The profit made by a business in 2017 was $35,400. The proprietor injected new capital of $10,200 during\nthe year and withdrew a monthly salary of $500.\nlf net assets at the end of 2017 were $95,100, what was the proprietorVs capital at the beginning of the year?
Answer: 55500
Question: A manufacturing company receives an invoice on 29 February 2020 for work done on one of its machines.\n$25,500 of the cost is actually for a machine upgrade, which will improve efficiency. The accounts\ndepartment do not notice and charge the whole amount to maintenance costs. Machinery is depreciated at\n25c jor annum on a straight-line basis, with a proportional charge in the years of acquisition and disposalAnBy what amc n .1 will the profit for the year to 30 June 202u be understated?
Answer: $23375
Question: A business can make a profit and yet have a reduction in its bank balance. Which ONE of the following might cause this to happen?
Answer: The lengthening of the period of credit given to customers
Question: Where a transaction is entered into the correct ledger accounts, but the wrong amount is used, It is known as?
Answer: An error of original entry
Question: A businessYs bank balance increased by $750,000 during its last financial year. During the same period Unissued shares of $1 million and repaid a loan note of $750,000. It purchased non- current assets for\n$200,000 and charged depreciation of $100,000. Working capital (other than the bank balance) increase( by\n$575,000.\nWhat was its profit for th year?
Answer: 1175000
Question: A trader’s net profit for the year may be computed by using which of the following formulae?
Answer: Closing capital + drawings – capital introduced – opening capital
Question: Which of the following calculations could produce an acceptable figure for a trader’s net profit for a period if no accounting records had been kept?
Answer: Closing net assets plus drawings minus capital introduced minus opening net assets
TO BUY YOUR ACC204 – INTRODUCTION TO FINANCIAL ACCOUNTING II EXAM SUMMARY CLICK HERE