ZIMBABWE SCHOOL EXAMINATIONS COUNCIL <br> General Certificate of Education Ordinary Level
PRINCIPLES OF ACCOUNTING
PAPER 1 Multiple Choice
NOVEMBER 2020 SESSION
4051/1
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 11 printed pages and 1 blank page. Copyright: Zimbabwe School Examinations Council, N2020.
Question 1
Which of the following are assets only?
A cash, drawings, motor vehicles
B cash, fixtures, trade payables
C furniture, inventory, stationery
D machinery, cash, trade receivables
Question 2
What is the source document for a sales returns journal?
A credit note
B debit note
C purchases invoice
D sales invoice
Question 3
A trader buys goods on credit from a supplier for \(\$5000\) less \(5\%\) trade discount.
The double entry is
| | debit | credit | | :--- | :--- | :--- | | A | purchases account \(\$4750\) | supplier's account \(\$4750\). | | B | purchases account \(\$5000\) | supplier's account \(\$5000\). | | C | supplier's account \(\$4750\) | purchases account \(\$4750\). | | D | supplier's account \(\$5000\) | purchase account \(\$5000\). |
Question 4
Which of the following shows the correct order of the accounting cycle?
A subsidiary books → financial statements → trial balance
B subsidiary books → ledger → trial balance
C transaction → financial statements → trial balance
D transaction → ledger → subsidiary books
Question 5
Trade discount differs from cash discount in that it is
A an allowance for prompt payment.
B deducted after cash discount.
C given for bulk buying.
D recorded in the purchases journal.
Question 6
Which of the following is a computer hardware device?
A Keyboard
B Microsoft excel
C Microsoft word
D Pastel
Question 7
The following ledger account was taken from the books of a trader.
Purchases Account
| 2017 | \$ | 2017 | \$ | | :--- | :--- | :--- | :--- | | May 7 Cash <br> 14 Bank | \(\begin{array}{r} 600 \\ 1200 \\ 1800 \\ \hline \end{array}\) | May 31 Income statement | 1800 <br> 1800 |
In which ledger is this account found?
A General ledger.
B Private ledger.
C Trade payables ledger.
D Trade receivables ledger.
Question 8
Goods sold on credit to A. Moyo were recorded in B. Moyo's account.
This is an error of
A commission.
B omission.
C principle.
D transposition.
Question 9
A trader sold goods for \(\$10000\) less \(20\%\) trade discount. A \(5\%\) cash discount is offered when payment is done within 30 days.
If a cheque was received after 45 days, how much was recorded in the cash book?
A \(\$7500\)
B \(\$7600\)
C \(\$8000\)
D \(\$9500\)
Question 10
The totals of a Trial balance agree as a result of which concept?
A consistency concept
B double entry concept
C matching concept
D prudence concept
Question 11
The delivery cost of goods to customers by a trader is recorded in her books as
A carriage inwards debited to Profit and Loss account.
B carriage inwards debited to Trading account.
C carriage outwards debited to Profit and Loss account.
D carriage outwards debited to Trading account.
Question 12
On 1 January 2017 a trader obtained a loan of \(\$25000\) at an interest rate of \(5\%\) per annum. During the year interest on loan paid was \(\$250\).
The interest on loan due on 31 December 2017 was
A \(\$250\).
B \(\$1000\).
C \(\$1250\).
D \(\$1500\).
Question 13
Bad debts are written off by
A crediting bad debts account, debiting provision for bad debts account.
B debiting bad debts account, crediting debtors' account.
C debiting debtors' account, crediting bad debts account.
D debiting provision for bad debts account, crediting bad debts account.
Question 14
Office equipment bought for use in the business is
A capital expenditure added to capital in the Statement of Financial position.
B capital expenditure added to non-current assets in the Statement of Financial position.
C revenue expenditure added to operating expenses in the Income Statement.
D revenue expenditure added to purchases in the Trading account.
Question 15
On 1 January 2015 a trader had motor vehicles worth \(\$50000\). Motor vehicles are depreciated at \(10\%\) per annum using the reducing balance method.
What was the net book value of the motor vehicles on 31 December 2016?
A \(\$5000\)
B \(\$9500\)
C \(\$40500\)
D \(\$45000\)
Question 16
What is the purpose of preparing control accounts?
A To calculate total debtors and total creditors.
B To calculate total sales and total purchases.
C To correct errors.
D To prevent fraud.
Question 17
The amount deposited directly in a business bank account is a
A credit transfer.
B direct debit.
C service fee.
D standing order.
Question 18
A trader bought an office computer at a cost of \(\$3300\). The following expenses were incurred:
| | \(\$\) | | :--- | ---: | | Carriage costs | 500 | | Installation costs | 100 | | Printing stationary | 50 |
How much was debited in the office computer account?
A \(\$3400\)
B \(\$3800\)
C \(\$3900\)
D \(\$3950\)
Question 19
Which of the following transactions reduces working capital?
A additional cash capital
B buying goods on credit for resale
C buying motor vehicles by cheque
D receiving long term loan
Question 20
The following method can be used to calculate net profit.
A closing capital - opening capital - drawings
B closing capital - opening capital + drawings
C opening capital - closing capital - drawings
D opening capital + closing capital - drawings
Question 21
Regular amounts received by a Not for profit making organisation from members are
A donations.
B entrance fees.
C life membership fees.
D subscriptions.
Question 22
What is the main purpose of preparing departmental trading accounts?
A to apportion operating expenses
B to calculate gross profit or loss for each department
C to calculate net profit or loss for each department
D to show the financial position of each department
Question 23
A cash book had an opening debit balance of \(\$1100\). The following information was available:
| | \(\$\) | | :--- | ---: | | Dividends | 3500 | | Dishonoured cheques | 200 | | Bank charges | 50 |
What was the balance as per updated cash book?
A \(\$2650\)
B \(\$4350\)
C \(\$4450\)
D \(\$4750\)
Question 24
Cost of production is calculated as
A cost of raw materials consumed + direct costs + indirect costs.
B cost of raw materials consumed + direct costs - indirect costs.
C cost of raw materials consumed - direct costs + indirect costs.
D cost of raw materials consumed - direct costs - indirect costs.
Question 25
The following details were obtained from the books of a trader.
2017
January 1 Purchases ledger control
January 31
Credit purchases 28400
Discount received 3200
Cheques paid to creditors 19700
The amount owed to creditors on 31 January 2017 was
A \(\$1300\).
B \(\$5100\).
C \(\$12300\).
D \(\$18700\).