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Exam 22: Single Entry and Incomplete Records

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Question 1

Multiple Choice

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You are told that the mark up on an item is 20%. If the item costs £50, then the sales price should be:

A) £60
B) £62.50
C) £65
D) None of the above

E) B) and C)
F) A) and D)

Correct Answer

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A

Question 2

Multiple Choice

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B. Little owed his suppliers £95,000 at the start of the year. By the end of the year he had debts Outstanding to suppliers of £60,000. He paid suppliers £150,000 by cheque and £25,000 in cash. The Suppliers gave B. Little a total of £4,000 in cash discounts. What are the purchases for the year?

A) £119,000
B) £140,000
C) £144,000
D) £175,000

E) A) and C)
F) B) and C)

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Question 3

Multiple Choice

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Opening inventory is £29,000, closing inventory is £31,000, purchases are £128,000, and purchase returns are £8,500. Assume that the suppliers are always paid for in cash and returns are always received in cash, what is the charge to the income statement in the period.

A business has the following cash and bank transactions during the year ended 31/12/X1. Opening balance: Cash £1,000, Bank £2,000 overdrawn Cash receipts: £25,200 Cash paid: £6,400 Cash paid to bank: £11,000 Cheque payments: £16,400 Closing balance: Cash £1,200, Bank £12,400 overdrawn. What are the total cash and bank drawings?

If gross profit is £50,000 and the net profit is 25% of gross profit, the expenses must be:

The net book value of a company's non-current assets was £400,000 at 1 January 20X0. During the year to 31 December 20X0 the company sold non-current assets for £50,000, incurring a loss of £10,000. The depreciation charge for the year was £40,000. What was the net book value of the non-current assets at 31 December 20X0?

An entity sells goods earning a constant mark up of 25%. Sales revenue in the period is £250,000. Opening inventory is valued at £5,000; closing inventory is valued at £10,000. Purchases were £225,000. The owner suspects theft; calculate the expected loss from theft given all the previous figures are correct.

Anna had an opening cash balance of £500, she received £28,000 cash in the period, paid £15,000 into the bank, paid staff wages of £3,200, paid sundry expenses of £800, paid the window cleaner £200, paid a repair man £2,000 and had £800 left on hand at the end of the year. Anna helped herself to cash when she was short. Which of the following is correct?

Anna is not wealthy. Her retail business had an opening cash balance of £500, she paid £15,000 cash into the bank, paid staff wages of £3,200 cash, paid sundry expenses of £800 cash, paid the window cleaner £200 cash, paid a repair man £2,000 cash and had £800 left on hand at the end of the year. Anna did not take any cash drawings. Which of the following is most likely to be correct?

Opening inventory is £29,000, closing inventory is £31,000, purchases are £128,000, and purchase returns are £8,500. There was an opening balance on the supplier's account of £10,000 and a closing balance of £12,500. How much was paid to the suppliers in the period.

The telephone account for the year ended 30 June 20X2 was as follows: Opening balance for telephone accrued at 1 July 20X2 £6,000 Payments made during the year: 1 August 20X1 for the period to 31 July 20X1 £12,000 1 November 20X1 for the period to 31 October 20X1 £14,400 1 February 20X2 for the period to 31 January 20X2 £18,000 30 June for the period to 30 April 20X2 £16,800 Which of the following is the appropriate entry for telephone in the financial statements at 30 June 20X2?

A business achieves a margin of 25% on sales revenue. Opening inventory was £36,000, closing inventory was £56,000 and purchases totalled £600,000. The sales in the period are therefore:

The net assets of Stuart Ltd. at 1 January 20X1 amounted to £128,000. During the year ended 31 December 20X1 he introduced a further £50,000 of capital and made drawings of £48,000. At 31 December 20X1 Stuart Ltd's net assets totalled £94,000 What was Stuart Ltd.s profit/ (loss) for the year ended 31 December 20X1?

Calculate the value of purchases from the following information:

A business commenced with a bank balance of £6,500; it subsequently purchased goods by cheque for £20,000; gross profit mark-up was 120%; half the goods were sold for cash, less cash discount of 5%; all takings were banked. The resulting net profit is:

A business has the following items extracted from its accounting records. Sales £75,000, opening inventory £5,000, closing inventory £7,500. The business applies a constant mark up of 25%. The total purchases for the year are?