Principles of Accounting | Study Mode

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Question 21
A
Bonus
B
Good will
C
Premium
D
Commission
Explanation

Goodwill is the excess of the purchase consideration over the total value of an entity


Correct option: B
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Question 22
A
Selling price
B
Fixed percentage on cost
C
Cost price
D
Invoice price
Explanation

Goods are transferred from head office to branch at cost price, selling price and cost price plus mark up


Correct option: C
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Question 23
A
Price above or below the stipulated price
B
Any price but not below the transfer price
C
Cost price
D
A price that is equal to the mark up
Explanation

Cost plus mark up is a pricing strategy in which the selling price is determined by adding a specific amount mark up to a product unit cost


Correct option: A
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Question 24
A
cost based transfer price
B
market based transfer pricing
C
Dual pricing system
D
peak pricing
Explanation

Explanation not provided, please join discuss, your contributions are welcomed


Correct option: D
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Question 25
A
Formation
B
dissolution
C
winding up
D
termination
Explanation

It is the first step in termination process


Correct option: B
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Question 26
A
4000
B
300
C
4300
D
5000
Explanation

Explanation not provided, please join discuss, your contributions are welcomed


Correct option: C
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Question 27
A
Cost price
B
new price
C
invoice price
D
normal price
Explanation

Branch stock adjustment account deals with the loading on the respective items of goods relating to Branch stock account.

Branch adjustment account is prepared at invoice price.

The difference between the two sides of this account reveals either gross profit (if credit side is greater than the debit side) or gross loss (if debit side is greater than the credit side).


Correct option: C
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Question 28
A
Promote mutual understanding
B
Enhance mistrust
C
Encourage discrepancy
D
Control funds
Explanation

Partnership deed can be used to:

i. Indicates terms on which the business corporation us founded

ii. To form a partnership for the purpose of doing business together

iii. Prevent future disputes

iv. Promote mutual understanding

v. Avoid mistrust


Correct option: A
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Question 29
A
Goods are sold at specific prices
B
goods are perishable
C
goods attract different gross profit percentage
D
to disclose gross profit or loss
Explanation

cost price method is used to enhance quick sales


Correct option: B
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Question 30
A
#1870
B
#1530
C
#1640
D
#1820
Explanation

Explanation not provided, please join discuss, your contributions are welcomed


Correct option: D

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