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CIMA BA3 - Fundamentals of financial accounting

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Total 393 questions

An entity decides to revalue its freehold property during the current period creating a revaluation surplus.

Where in the current period financial statements would the revaluation surplus appear?

A.

Statement of financial position and statement of changes in equity

B.

Statement of changes in equity and statement of cash flow

C.

Statement of financial position and income statement

D.

Statement of changes in equity and income statement

Accounting standards are used to produce the financial statements of all business entities.

Which ONE of the following best describes why accounting standards are needed?

A.

To provide information for tax purposes

B.

To provide information required by law

C.

To provide information that fairly represents the performance and position of the entity

D.

To provide information for shareholders

The sales ledger control account shows a balance of £236,725, whilst the individual customer balances total £231,472.

One possible explanation for the difference between the two may bE.

A.

An invoice for £5,253 has been recorded in the sales ledger but not in the sales day book

B.

A payment for £5,253 has been recorded in the cashbook but not in the sales ledger

C.

The sales day book has been overcast by £5,253

D.

The sales daybook has been undercast by £5,253

Refer to the exhibit.

ABC issued 200,000 $0.50 equity shares at a price of $1.80. This amount was received in cash

What is the correct journal to record this issue?

A.

A

B.

B

C.

C

D.

D

Refer to the Exhibit.

What is the wages expense for the income statement for month 1?

A.

$3,808

B.

$4,428

C.

$6,236

D.

$6,966

Refer to the Exhibit.

The purchase ledger control account shows a balance of £324,564, while the individual customer account balances total £328,234.

Which of the following is a possible explanation for the difference between the two?

A.

and (iii) only

B.

and (iv) only

C.

and (iv) only

D.

and (iii) only

The financial statements are produced in accordance with relevant accounting standards. This compliance ensures the requirement of fair presentation of transactions and events is met

How is this compliance emphasized?

A.

Reconciliation procedures

B.

Employment of qualified employees

C.

Specific disclosure

D.

Regular preparation of financial statements

The accounting concept to be considered when the owner of a business uses business funds to pay for his private household expenses, is the:

A.

Money measurement concept

B.

Prudence concept

C.

Separate entity concept

D.

Realization concept

Refer to the Exhibit.

Which of the following are books of prime entry?

A.

(ii), (iii) and (iv)

B.

(i), (ii), (iv) and (v)

C.

(ii), (v) and (vi)

D.

(i), (ii), (iv) and (vi)

Which one of the following is not an example of an intangible asset?

A.

Patents

B.

Trademarks

C.

Royalties

D.

Research and Development costs