ZIMSEC O-Level Principles of Accounts Paper 1 November 2018 Question Paper

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

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

NOVEMBER 2018 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.

Question 1

The document used to record goods sold on credit is

A a bank statement.

B a credit note.

C a statement of account.

D an invoice.

Question 2

The personal accounts of suppliers are found in the

A general ledger.

B private ledger.

C purchases ledger.

D sales ledger.

Question 3

A liability of the business to the owner is recorded in the

A capital account.

B creditor's account.

C drawings account.

D loan account.

Question 4

Which is a computer output device?

A keyboard

B mouse

C printer

D scanner

Question 5

An advantage of using a computerised accounting system is that

A expensive software is used.

B it is difficult to change from one system to another.

C it requires skilled personnel.

D there are less chances of arithmetical errors.

Question 6

A credit sale of an old cabinet valued at $\$ 3000$ to B. Ndlovu is recorded in a

A cashbook.

B general journal.

C petty cashbook.

D sales journal.

Question 7

The double entry for the purchase of paper and envelopes on credit is

Question 8

The difference between cash discount and trade discount is that cash discount is

A allowed to encourage bulk buying.

B deducted on the gross price.

C not entered in the books of account.

D offered for prompt payment.

Question 9

The monthly petty cash float of a business is $\$ 500$, payments for July 2013 total $\$ 425$. How much is reimbursed to restore the imprest?

A $\$ 75$

B $\$ 425$

C $\$ 500$

D $\$ 925$

Question 10

The entry for bad debts in a debtors account is obtained from the

A general journal.

B purchases journal.

C sales journal.

D sales returns journal.

Question 11

The sales ledger control account is debited with

A bad debts.

B contra entries.

C discount allowed.

D dishonoured cheques.

Question 12

A trader provided the following information on 31 July 2013.

| | | | :--- | ---: | | Sales ledger control account balance, 01 July | 5600 debit | | Credit sales | 16000 | | Cheques received from debtors | 17200 |

What is the sales ledger control account balance on 31 July?

A $\$ 4400$

B $\$ 6800$

C $\$ 27600$

D $\$ 38800$

Question 13

Capital expenditure is the

A additional capital paid in by the owner of the business.

B cost of running the business on a day to day basis.

C money spent on buying non-current assets.

D money spent in selling non-current assets.

Question 14

In the reducing balance method, the depreciation rate is applied on the

A book value of fixed assets.

B cost of the fixed asset.

C market value of the fixed asset.

D residual value of the fixed asset.

Question 15

The balance as per adjusted cashbook is $\$ 1721$ debit. Unpresented cheques amount to $\$ 150$ and bank lodgements not yet credited total $\$ 242$.

The balance as per bank statement is

A $\$ 1571$.

B $\$ 1629$.

C $\$ 1813$.

D $\$ 1871$.

Question 16

A credit balance of $\$ 600$ in the rent payable account means

A $\$ 600$ has been paid for rent.

B $\$ 600$ has been received for rent.

C $\$ 600$ is owed by the business for rent.

D $\$ 600$ is owed to the business for rent.

Question 17

The credit purchase of stationery, valued at $\$ 1500$, from V. Mabasa had been debited to Mabasa's account and credited to stationery account.

The double entry to correct this error is

Question 18

The balance on 1 January 2011 in the provision for bad debts account was $\$ 550$. The provision for bad debts for the current year is $\$ 600$.

The amount of provision for bad debts to be charged to the profit and loss account is

A $\$ 50$.

B $\$ 550$.

C $\$ 600$.

D $\$ 1150$.

Question 19

Which error prevents the totals of a trial balance from agreeing?

A No record had been made for a computer worth $\$ 1200$ brought into the business by the owner.

B The payment of $\$ 1000$ cash for rent had been debited to the electricity account.

C The purchases account had been debited twice for goods worth $\$ 2000$ bought from L. Mhashu.

D The sale of shop fittings worth $\$ 3000$ on credit to L. Maseko had been credited to the sales account.

Question 20

In the balance sheet, accrued expenses are shown as

A current assets.

B current liabilities.

C non-current assets.

D non-current liabilities.

Question 21

The following information is provided by a trader.

| | $\$$ | | :--- | ---: | | Inventory | 5000 | | Bank overdraft | 1200 | | Cash in hand | 900 | | Creditors | 1800 | | Stock of stationery | 600 |

Working capital is

A $\$ 3500$.

B $\$ 4700$.

C $\$ 5300$.

D $\$ 9500$.

Question 22

The current ratio of a business indicates its ability to

A buy stock.

B pay employees.

C pay off current liabilities.

D pay off non-current liabilities.

Question 23

The double entry for closing the drawings account is

Question 24

What does a debit balance in a capital account mean?

A the business is insolvent

B the business is solvent

C the owner invested more capital

D the owner took goods for own use

Question 25

A manufacturer bought a machine for $\$ 40000$. Its estimated useful life is five years after which its value would be $\$ 12000$. Depreciation is charged on a straight line method.

What is the annual depreciation charge?

A $\$ 2400$

B $\$ 5600$

C $\$ 8000$

D $\$ 12000$

Question 26

The following information relates to the business of D. Mahlangu.

| | | $\$$ | | :--- | :--- | ---: | | Inventory: | 1 January 2010 | 10000 | | | 31 December 2010 | 30000 | | Purchases | | 140000 |

The rate of stockturn is

A 4 times.

B 6 times.

C 7 times.

D 12 times.

Question 27