Questions from Financial Accounting


Q: On 20 December 20X6 one of Incident plc’s lorries was involved in

On 20 December 20X6 one of Incident plc’s lorries was involved in an accident with a car. The lorry driver was responsible for the accident and the company agreed to pay for the repair to the car. The...

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Q: Plasma Ltd, a manufacturer of electrical goods, guarantees them for

Plasma Ltd, a manufacturer of electrical goods, guarantees them for 12 months from the date of purchase by the customer. If a fault occurs after the guarantee period but is due to faulty manufacture o...

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Q: In 20X6 Alpha AS made the decision to close a loss-

In 20X6 Alpha AS made the decision to close a loss-making department in 20X7. The company proposed to make a provision for the future costs of termination in the 20X6 profit or loss. Its argument was...

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Q: Easy View Ltd had started business publishing training resource material in ring

Easy View Ltd had started business publishing training resource material in ring binder format for use in primary schools. Later it diversified into the hiring out of videos and had opened a chain of...

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Q: Suktor is an entity that prepares financial statements to 30 June each

Suktor is an entity that prepares financial statements to 30 June each year. On 30 April 20X1 the directors decided to discontinue the business of one of Suktor’s operating divisions. They decided to...

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Q: On 1 April 20W9 Kroner began to lease an office block on

On 1 April 20W9 Kroner began to lease an office block on a 20-year lease. The useful economic life of the office buildings was estimated at 40 years on 1 April 20W9. The supply of leasehold properties...

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Q: The finance director of Small Machine Parts Ltd is considering the acquisition

The finance director of Small Machine Parts Ltd is considering the acquisition of a lease of a small workshop in a warehouse complex that is being redeveloped by City Redevelopers Ltd at a steady rate...

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Q: Epsilon is a listed entity. You are the financial controller of

Epsilon is a listed entity. You are the financial controller of the entity and its consolidated financial statements for the year ended 31 March 2009 are being prepared. The board of directors is resp...

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Q: Epsilon is a listed entity. You are the financial controller of

Epsilon is a listed entity. You are the financial controller of the entity and its consolidated financial statements for the year ended 30 September 2008 are being prepared. Your assistant, who has pr...

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Q: On 1 April year 1, a deep discount bond was issued

On 1 April year 1, a deep discount bond was issued by DDB AG. It had a face value of £2.5 million and covered a five-year term. The lenders were granted a discount of 5%. The coupon rate was 10% on th...

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