20 Goodwill should never be shown on the balance sheet of a partnership.
Is this statement true or false?
A False
B True
(1 mark)

21 Which of the following journal entries are correct, according to their narratives?
                                                                       Dr              CR
                                                                        $                $
1 Suspense account                                        18,000
Rent received account                                                       18,000
Correction of error in posting $24,000 cash received for rent to the rent received account as $42,000
2 Share premium account                              400,000
Share capital account                                                        400,000
1 for 3 bonus issue on share capital of 1,200,000 50c shares
3 Trade investment in X                                 750,000
Share capital account                                                        250,000
Share premium account                                                    500,000
500,000 50c shares issued at $1.50 per share in exchange for shares in X
A 1 and 2
B 2 and 3
C 1 only
D 3 only
(2 marks)

17 Which of the following explains the imprest system of operating petty cash?
A Weekly expenditure cannot exceed a set amount.
B The exact amount of expenditure is reimbursed at intervals to maintain a fixed float.
C All expenditure out of the petty cash must be properly authorised.
D Regular equal amounts of cash are transferred into petty cash at intervals.
(2 marks)

18 Which of the following are differences between sole traders and limited liability companies?
(1) A sole traders’ financial statements are private; a company’s financial statements are sent to shareholders and may be publicly filed
(2) Only companies have capital invested into the business
(3) A sole trader is fully and personally liable for any losses that the business might make; a company’s shareholders are not personally liable for any losses that the company might make.
A 1 and 2 only
B 2 and 3 only
C 1 and 3 only
D 1, 2 and 3
(2 marks)

19 Which of the following documents should accompany a payment made to a supplier?
A Supplier statement
B Remittance advice
C Purchase invoice
(1 mark)

14 A company has made a material change to an accounting policy in preparing its current financial statements.
Which of the following disclosures are required by IAS 8 Accounting policies, changes in accounting estimates and errors in the financial statements?
1 The reasons for the change.
2 The amount of the adjustment in the current period and in comparative information for prior periods.
3 An estimate of the effect of the change on the next five accounting periods.
A 1 and 2 only
B 1 and 3 only
C 2 and 3 only
D 1, 2 and 3
(2 marks)

15 According to IAS 2 Inventories, which of the following costs should be included in valuing the inventories of a manufacturing company?
(1) Carriage inwards
(2) Carriage outwards
(3) Depreciation of factory plant
(4) General administrative overheads
A All four items
B 1, 2 and 4 only
C 2 and 3 only
D 1 and 3 only
(2 marks)

16 Part of a company’s cash flow statement is shown below:
                                                $’000
Operating profit                          8,640
Depreciation charges                  (2,160)
Increase in inventory                   (330)
Increase in accounts payable         440
The following criticisms of the extract have been made:
(1) Depreciation charges should have been added, not deducted.
(2) Increase in inventory should have been added, not deducted.
(3) Increase in accounts payable should have been deducted, not added.
Which of the criticisms are valid?
A 2 and 3 only
B 1 only
C 1 and 3 only
D 2 only
(2 marks)

11 The following control account has been prepared by a trainee accountant:

图片：1.jpg

Whatshould the closing balance be when all the errors made in preparing thereceivables ledger control account have been corrected?
A $395,200
B $304,300
C $309,500
D $307,100
(2 marks)
12At 31 December 2004 Q, a limited liability company, owned a buildingthat cost $800,000 on 1 January 1995. It was being depreciated at twoper cent per year.
On 1 January 2005 a revaluation to $1,000,000 was recognised. At this date the building had a remaining useful life of 40 years.
What is the depreciation charge for the year ended 31 December 2005 and the revaluation reserve balance as at 1 January 2005?
       Depreciation charge                                   Revaluation reserve
for year ended 31 December 2005                      as at 1 January 2005
                   $                                                                $
A            25,000                                                        200,000
B            25,000                                                        360,000
C            20,000                                                        200,000
D            20,000                                                        360,000
(2 marks)
13 P and Q are in partnership, sharing profits equally.
On30 June 2005, R joined the partnership and it was agreed that from thatdate all three partners should share equally in the profit.
In theyear ended 31 December 2005 the profit amounted to $300,000, accruingevenly over the year, after charging a bad debt of $30,000 which it wasagreed should be borne equally by P and Q only.
What should P’s total profit share be for the year ended 31 December 2005?
A $ 95,000
B $122,500
C $125,000
D $110,000
(2 marks)