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June 2018 FA Paper

1. Which of the following is not considered a qualitative characteristic of financial statements?

Cost Principle Understandability Relevance Reliability

2. In which book are transactions recorded based on credit notes issued?

Sales Book Purchase Book Sales Return Book Purchase Return Book

3. Which principle serves as an exception to the consistency principle?

Cost Principle Going Concern Principle Matching Principle Prudence Principle

4. How is interest calculated under the Hire Purchase System?

Outstanding hire purchase price Outstanding cash price Instalment amount Cost price of the asset

5. What does the balance in the consignment account represent?

Amount receivable from consignee Amount payable to consignee Profit/loss on consignment Closing stock with consignee

6. What type of account is Provision for Bad Debts classified as?

Real Account Nominal Account Personal Account None of the above

7. Which accounting concept treats a business as separate from its owner?

Going Concern Concept Conservatism Concept Matching Concept Business Entity Concept

8. How should salary arrears for previous years, paid in the current year, be classified?

Prior-period item Extraordinary item Ordinary item requiring separate disclosure Contingent item

9. What is the discount called when it is mentioned directly in a sales invoice?

Cash Discount Trade Discount Rebate Allowance

10. How are canteen expenses typically allocated among departments?

Based on departmental floor space Based on departmental direct wages Based on departmental sales Based on the number of employees in each department