ZIMSEC O-Level Principles of Accounts Paper 1 June 2019 Question Paper

for Arrfurmereve Meneswersed ZIMBABWE SCHOOL EXAMINATIONS COUNCIL General Certificate of Education Ordinary Level

**PRINCIPLES OF ACCOUNTING** **4051/1** **PAPER 1 Multiple Choice**

**JUNE 2019 SESSION** 1 hour 30 minutes

Additional materials: Multiple Choice answer sheet Soft clean eraser Soft pencil (type B or HB is recommended)

TIME 1 hour 30 minutes

INSTRUCTIONS TO CANDIDATES

Do not open this booklet until you are told to do so.

Write your name, Centre number and candidate number on the answer sheet in the spaces provided unless this has already been done for you.

There are forty questions in this paper. Answer all questions. For each question, there are four possible answers, A, B, C and D. Choose the one you consider correct and record your choice in soft pencil on the separate answer sheet.

Read very carefully the instructions on the answer sheet.

INFORMATION FOR CANDIDATES

Each correct answer will score one mark. A mark will not be deducted for a wrong answer. Any rough working should be done in this booklet.

Calculators may be used.

**This question paper consists of $\mathbf{1 6}$ printed pages.**

Question 1

One of the advantages of sole proprietorship is that

A chances of business growth are limited.

B decision making is fast.

C owner bears all losses.

D owner has unlimited liability.

Question 2

Which part of a computer manipulates accounting data?

A central processing unit

B keyboard

C mouse

D visual display unit

Question 3

In a manufacturing business, which item is a direct cost?

A depreciation of plant

B factory power

C hire of special plant

D lubricant oil

Question 4

The balances of the carriage inwards and carriage outwards accounts are shown in the trial balance as

A credit carriage inwards, credit carriage outwards.

B credit carriage inwards, debit carriage outwards.

C debit carriage inwards, credit carriage outwards.

D debit carriage inwards, debit carriage outwards.

Question 5

A capital account.

B drawings account.

C purchases account.

D sales account.

Question 6

Which items are debited to the sales ledger control account?

A cash refunds and dishonoured cheques

B credit sales and bad debts

C interest on overdue accounts and set off

D returns inwards and cash received

Question 7

Which of the following items is capital expenditure?

A carriage costs of purchases

B cash paid for insuring delivery vans

C legal costs for debt collection

D payment for new alarm system for vehicle

Question 8

Goods sold to Hilda were debited to Hilda's account and credited to the sales account.

Which accounting concept was applied?

A consistency

B double entry

C going concern

D prudence

Question 9

Given:

| | $\$$ | | :--- | ---: | | Purchase of delivery van, cost | 11500 | | Import duty on delivery van | 500 | | Rear view mirror repairs | 750 | | Legal costs of changing ownership | 1400 |

The amount debited to the delivery van account is

A $\$ 11500$.

B $\$ 12900$.

C $\$ 13400$.

D $\$ 14150$.

Question 10

Which of the following is debited to the updated cash book?

A credit transfer

B dishonoured cheques

C interest on overdraft

D ledger fees

Question 11

What is the source document for the sales returns day book?

A bank statement

B credit note

C debit note

D sales invoice

Question 12

A decrease in the provision for bad debts is recorded as

> debit

A bad debts account credit

B profit and loss account provision for bad debts account.

C provision for bad debts account bad debts account. bad debts account.

D provision for bad debts account profit and loss account

Question 13

A hair salon provided the following information:

| | $\$$ | | :--- | ---: | | Opening inventory | 15000 | | Closing inventory | 6500 | | Purchases | 65000 | | Gross profit | 50000 | | Returns outwards | 3500 |

The turnover was

A $\$ 116000$.

B $\$ 120000$.

C $\$ 123000$.

D $\$ 140000$.

Question 14

In partnership accounts, a partner's salary due is a

A credit in the current account.

B credit in the profit and loss account.

C debit in the current account.

D debit in the profit and loss account.

Question 15

Which item appears as a debit entry in a partner's current account?

A interest on capital

B partner's commission

C partner's salary

D share of loss

Question 16

A club's subscriptions account had a credit balance at the end of a financial year.

In which section of a statement of financial position is this balance recorded?

A current assets

B current liabilities

C non-current assets

D non-current liabilities

Question 17

A creditor was paid by cheque after the preparation of the statement of financial position.

What is the effect of this transaction on the bank account and trade payable account?

bank

A decrease

B decrease

C increase

D increase

trade payable

decrease

increase

decrease

increase

Question 18

Goods returned to Tanaka, the supplier, worth $\$ 350$ were debited to both Tanaka's account and the returns outwards account.

The journal entry to correct the error is

debit

A returns outwards account $\$ 350$

B returns outwards account $\$ 700$

C suspense account $\$ 700$

D Tanaka account $\$ 350$

credit

Tanaka account $\$ 350$. suspense account $\$ 700$.

returns outwards account $\$ 700$.

returns outwards account $\$ 350$.

Question 19

What shows that the business of a sole trader is solvent?

A credit balance in a capital account

B credit balance in a profit and loss account

C debit balance in a capital account

D debit balance in a profit and loss account

Question 20

Which of the following part of the accounting cycle is correct?

A ledger ⟶ subsidiary books ⟶ final accounts

B source documents ⟶ subsidiary books ⟶ ledger

C subsidiary books ⟶ trial balance ⟶ final accounts

D subsidiary books → trial balance ⟶ ledger

Question 21

The total of the sales returns journal is

A credited to the returns inwards account.

B credited to the returns outwards account.

Question 22

A basketball club provided the following information:

| | $\$$ | | :--- | ---: | | Subscriptions in arrears | 1690 | | Subscriptions in advance | 940 | | Rent receivable prepaid | 120 | | Inventory | 710 | | Owing to suppliers | 60 |

The total for assets was

A $\$ 1770$.

B $\$ 2400$

Question 23

Question 24

The following ledger account was extracted from the books of Tapiwa on 31 December 2015.

**Sales account**

| 2015 | $\$$ | 2015 | $\$$ | | :--- | :---: | :--- | :---: | | Dec 31 Balance c/d | 55000 | December 31 Cash | 20000 | | | | Dec 31 Trade receivables | 35000 |

What is meant by the entry "Trade receivables $\$35000$"?

A cash sales

B cheques received from goods sold

C credit sales

D total sales for the month

Question 25

A bank statement showed a credit balance of $\$ 2500$ on 31 July 2016. The following items appeared in the cash book but not on the bank statement.

| | $\$$ | | :--- | :---: | | cheques deposited | 3000 | | cheques issued | 1900 |

What was the cash book balance?

A $\$ 1400$ credit

B $\$ 1400$ debit