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CIMA Fundamentals of Financial Accounting Sample Questions:

1. Where a transaction is credited to the correct ledger account but debited to the purchases account instead of the fixed asset account, the error is known as an error of:

A) Original entry
B) Commission
C) Omission
D) Principle

2. 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 for shareholders
C) To provide information required by law
D) To provide information that fairly represents the performance and position of the entity

3. A company has a debt/equity ratio of 50%. If the company's total equity is $750,000, what is the gearing ratio for the company?

A) 50%
B) Impossible to tell from information provided.
C) 33.33%
D) 200%

4. There are many types of fraud that can happen within a business. On example could be the theft of cash, concealing the theft by delaying banking or by making up the shortage from other sources.
What is this type of fraud called?

A) Theft
B) Teeming and Lading
C) Ghost employee
D) Collusion

5. At 1 June 20X9 XY has opening inventory of 80 units at a cost of $7.60 each XY purchases the following units during the month of June:

During June 20X9, XY sold 250 units at a price of $15.00 each XY uses the first in. first out (FIFO) method of inventory valuation What is the value of XYs closing inventory at 30 June 20X9? Give your answer to the nearest $.

Solutions: