CIMA CIMAPRA17-BA3-1 Exam Questions Instant Access

Question 1

Life membership fees payable to a club or society are usually dealt with by:

ACrediting the total received to the income and expenditure account in the year in which they are received

BDebiting the total received to the income and expenditure account in the year in which they are received

CDebiting the total received to a Life Memberships account and transferring a proportion each year to the income and expenditure account

DCrediting the total received to a Life Memberships account and transferring a proportion each year to the income and expenditure account

Answer : D

Question 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?

ATo provide information for tax purposes

BTo provide information required by law

CTo provide information that fairly represents the performance and position of the entity

DTo provide information for shareholders

Answer : C

Question 3

Which one of the following is not an example of an intangible asset?

APatents

BTrademarks

CRoyalties

DResearch and Development costs

Answer : C

Question 4

The correct journal entries for subscriptions paid in advance is:

ADebit: Receivables account Credit: Subscriptions account

BDebit: Subscriptions accounts Credit: Payables

CDebit: Receivables Credit: Cash

DDebit: Cash Credit: Payables

Answer : B

Question 5

Which of the following would be a role of the management accountant?

AReporting historic transactions

BMonitoring actual results to expected results

CMeeting external reporting requirements

DProducing financial statements

Answer : B

Question 6

If an auditor expresses an opinion of `fair presentation' on a set of financial statements, this means:

AThe financial statements do not contain any errors

BThere is fraud taking place in the company

CThe financial statements comply with the requirements of the Companies Act and accounting statements

DThe financial statements have been audited by the internal auditors

Answer : C

Question 7

Which of the following is an example of where the materiality convention should be applied?

ASales to a customer in September, but for which the cash was not received until October.

BInventory of stationery items remaining at the year end.

CA proposed change in the method of depreciation of non-current assets.

DA two-year construction contract.

Answer : B

CIMA BA3 - Fundamentals of Financial Accounting CIMAPRA17-BA3-1 Exam Questions