ZIMSEC O-Level Principles of Accounts Paper 1 November 2015 Question Paper

ZIMBABWE SCHOOL EXAMINATIONS COUNCIL <br> General Certificate of Education Ordinary Level

**PRINCIPLES OF ACCOUNTS <br> PAPER 1 Multiple Choice**

7112/1

NOVEMBER 2015 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, $\mathbf{A}, \mathbf{B}, \mathbf{C}$ and $\mathbf{D}$. 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 11 printed pages and 1 blank page.

Question 1

An example of a personal account is

A capital account.

B machinery account.

C purchases account.

D stationery account.

Question 2

The total of the sales returns journal is posted to the

A credit side of the returns inwards account.

B credit side of the returns outwards account.

C debit side of the returns inwards account.

D debit side of the returns outwards account.

Question 3

Which document increases the amount owing on an invoice?

A credit note

B debit note

C receipt

D voucher

Question 4

A document that shows the amount to be paid by a customer is a

A bank statement.

B cheque stub.

C credit note.

D statement of account.

Question 5

Which is a computer software?

A monitor

B mouse

C pastel

D speaker

Question 6

Which component of a computer manipulates accounting information?

A the central processing unit

B the input device

C the output device

D the visual display unit

Question 7

A disadvantage of sole proprietorships is that

A decision making is faster.

B formation is easy.

C owner enjoys all the profits.

D there is unlimited liability.

Question 8

Which items match?

Question 9

The double entry for the purchase of equipment on credit is

| | Debit | Credit | | :--- | :--- | :--- | | A | creditor | equipment. | | B | creditor | purchases. | | C | equipment | creditor. | | D | purchases | creditor. |

Question 10

The owner of a business took stock at selling price for own use.

Which account is credited?

A capital account

B drawings account

C purchases account

D sales account

Question 11

Which item is revenue expenditure?

A buying equipment for the business

B cost of redecorating the manager's office

C cost of new tyres for a new van

D painting premises for the first time

Question 12

Control accounts are prepared to

A calculate credit sales.

B correct errors.

C locate errors.

D prevent fraud.

Question 13

The following information was provided by a manufacturer.

| Raw materials: | $\$$ | | :--- | ---: | | Opening stock/inventory | 3000 | | Purchases | 91000 | | Closing stock/inventory | 5000 | | Direct wages | 50000 |

What is the cost of raw materials consumed?

A $\$ 83000$

B $\$ 89000$

C $\$ 99000$

D $\$ 139000$

Question 14

The following account was taken from the general ledger of a trader.

Sales ledger control account

| 2012 | | $\$$ | 2012 | | $\$$ | | :---: | :--- | ---: | :---: | :--- | ---: | | Oct 1 | Balance b/d | 5000 | Oct 31 | Bank | 30000 | | 31 | Sales | 120000 | | Returns inwards | 4000 | | | Interest | 1000 | | Bad debts | 12000 |

The amount for debtors entered in the balance sheet on 31 October is

A $\quad \$ 5000$.

B $\quad \$ 80000$.

C $\quad \$ 120000$.

D $\quad \$ 126000$.

Question 15

A cash payment of $\$ 25$ for insurance was entered correctly in the cash book but was posted as $\$ 52$ to the insurance account.

The journal entry to correct the error is

| | Debit | Credit | | :--- | :--- | :--- | | A | cash account $\$ 25$ | insurance account $\$ 25$. | | B | insurance account $\$ 25$ | cash account $\$ 25$. | | C | insurance account $\$ 27$ | suspense account $\$ 27$. | | D | suspense account $\$ 27$ | insurance account $\$ 27$. |

Question 16

Which item increases a bank statement balance?

A dishonoured cheques

B credit transfers

C service fees

D stop orders

Question 17

Which items are used to update a cashbook?

A bank lodgements and dishonoured cheques

B credit transfers and unpresented cheques

C dividends and standing orders

D service fees and uncleared deposits

Question 18

A cash book had an overdraft of $\$ 2000$. The bank statement showed interest received of $\$ 5000$. Unpresented cheques were $\$ 7000$ and uncleared deposits totalled $\$ 1000$.

The balance as per bank statement is

A $\$ 1000$ debit.

B $\$ 3000$ debit.

C $\$ 9000$ credit.

D $\$ 11000$ credit.

Question 19

A credit balance in the rent received account represents rent

A not yet paid.

B paid during the year.

C received during the year.

D received in advance.

Question 20

A trader provided the following information:

| | $\$$ | | :--- | ---: | | Opening capital | 11000 | | Additional capital | 5000 | | Drawings | 3000 | | Closing capital | 25000 |

What was the net profit for the year?

A $\$ 6000$

B $\$ 12000$

C $\$ 17000$

D $\$ 23000$

Question 21

What is the double entry for net profit?

| | Debit | Credit | | :--- | :--- | :--- | | A | capital account | net profit | | B | capital account | profit and loss account | | C | net profit | capital account | | D | profit and loss account | capital account |

Question 22

The following balances were extracted from the books of a trader on 31 December 2011.

| | $\$$ | | | :--- | ---: | :--- | | Motor vehicles, cost | 60000 | Debit | | Provision for depreciation (01.01.11) | 6000 | Credit |

The motor vehicle was bought on 1 January 2009.

What is the depreciation charge on 31 December 2011 using the straight line method?

A $\$ 3000$

B $\$ 6000$

C $\$ 54000$

D $\$ 66000$

Question 23

A trader created a provision for doubtful debts of $10 \%$ of debtors and a provision for discount allowed of $1 \%$ of good debtors.

Debtors at the end of the year were $\$ 20000$.

The amount of net debtors was

A $\quad \$ 17800$.

B $\quad \$ 17820$.

C $\quad \$ 18000$.

D $\$ 18200$.

Question 24

The following information was provided by a trader.

| | $\$$ | | :--- | ---: | | Cost of sales | 100000 | | Total expenses | 10000 | | Net profit | 40000 |

What is the turnover?

A $\$ 50000$

B $\quad \$ 110000$

C $\quad \$ 140000$

D $\$ 150000$

Question 25

Which transaction reduces working capital?

A buying stock for cash

B donating $\$ 1000$ cash to charity

C paying $\$ 50$ cash to creditors

D selling stock to Farai on credit

Question 26

Which error causes an increase in the gross profit?

A closing stock/inventory undervalued

B opening stock/inventory omitted from a trading account