0452 s22 qp 12 (1)

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Cambridge IGCSE™
ACCOUNTING

0452/12

Paper 1 Multiple Choice

May/June 2022
1 hour 15 minutes

You must answer on the multiple choice answer sheet.

*7957941451*

You will need: Multiple choice answer sheet
Soft clean eraser
Soft pencil (type B or HB is recommended)
INSTRUCTIONS
 There are thirty-five questions on 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 multiple choice answer sheet.
 Follow the instructions on the multiple choice answer sheet.
 Write in soft pencil.
 Write your name, centre number and candidate number on the multiple choice answer sheet in the
spaces provided unless this has been done for you.
 Do not use correction fluid.
 Do not write on any bar codes.
 You may use a calculator.

INFORMATION
 The total mark for this paper is 35.
 Each correct answer will score one mark.
 Any rough working should be done on this question paper.

This document has 12 pages. Any blank pages are indicated.

IB22 06_0452_12/2RP
© UCLES 2022

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2
1

Which task would be carried out by a book-keeper?
A

comparison of financial statements between years

preparation of financial statements

provision of information for decision-making

recording financial transactions

The following ledger account appeared in the books of Leah, a trader.
Amraz account
$
April 26
30

purchases returns
bank

150

April 1

1900

discount

balance b / d

2100

purchases

3000

100

balance c / d

2950

5100

Which statement is correct?

Amraz allowed Leah $100 trade discount on 30 April.

Amraz owed Leah $2100 on 1 April.

Leah owed Amraz $2950 on 30 April.

Leah’s net purchases from Amraz in April were $2900.

Sarah sold goods on credit to Zafar.
How was this recorded in Sarah’s ledgers?
general ledger

sales ledger

credit

sales account

debit

Zafar account

debit

sales account

credit

Zafar account

credit

Zafar account

debit

sales account

debit

Zafar account

credit

sales account

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3
4

Omar sent a credit note to Miriam for goods returned.
How would Miriam record this transaction?

account to be debited

account to be credited

purchases returns

Omar

sales returns

Miriam

Omar

purchases returns

Miriam

sales returns

Ben sold goods to David for $900 cash.
In which book of prime entry would David record this transaction?

cash book

general journal

purchases journal

sales journal

A petty cashier received $100 from the chief cashier and $10 from an employee who had made
private calls on the business telephone.
How would these amounts be recorded in the petty cash book and the cash book?
debit petty
cash book
$

credit petty
cash book
$

debit
cash book
$

credit
cash book
$

110

100

110

100

What is an example of a compensating error?
A

A payment for office equipment repairs was debited to the office equipment account.

A purchase of goods from C Jones was credited to the account of C Johns.

The sale of goods, $65, to A Aziz was entered in the books as $56.

The wages account was undercast by $100 and the rent account was overcast by $100.

0452/12/M/J/22

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8

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After the preparation of Abdul’s draft financial statements, two errors were discovered.
The purchase of a machine by bank transfer, $5000, was omitted from the accounts.
The purchase of a motor vehicle, $15 000, was entered in the motor vehicle repair
account.
What effect will correcting these errors have on the non-current assets and the working capital?
non-current assets

working capital

increase 15 000

decrease 5000

increase 15 000

no effect

increase 20 000

decrease 5000

increase 20 000

no effect

Why is a sales ledger control account usually prepared by a different member of staff than the
person who maintains the sales ledger?
A

to deter fraud

to locate errors

to provide an instant total of trade receivables

to speed production of financial statements

10 What would be recorded on the credit side of a sales ledger control account?
A

cash refunded to credit customers

credit sales

interest charged on overdue accounts

sales returns

11 Maria’s draft income statement for the year ended 31 March 2022 showed a profit for the year of
$38 750.
On 31 December 2021, Maria received a 5% bank loan of $4800 which was incorrectly treated
as a revenue receipt.
In error, a whole year’s interest on the bank loan was included in the draft income statement for
the year ended 31 March 2022.
What was the correct profit for the year ended 31 March 2022?
A

$33 770

$34 130

$43 370

0452/12/M/J/22

$43 730

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12 Which statement about the reducing balance method of depreciation is not correct?
A

A lower amount of depreciation is charged in the early years of the asset’s life than in the
later years.

Each year a given percentage is deducted from the cost of the asset less the depreciation to
date.

It is used for assets which give greater benefits in the early years of their life.

The net book value of the non-current asset will never reach a nil value.

13 The financial year of Yeung ends on 31 March. On 1 April 2021, he purchased a machine for
$4000.
He estimated that it would have a useful working life of 3 years and a residual value of $100.
Yeung uses the straight-line method of depreciation.
The machine was sold on 1 April 2022 for $1500.
What was the loss on disposal?
A

$1100

$1200

$2400

$2500

14 On 1 April 2021, commission receivable, $210, was outstanding. Commission received during the
year ended 31 March 2022 amounted to $4850.
Which journal entry should have been made at the end of the financial year on 31 March 2022?
debit
$
A
B
C
D

commission receivable
income statement

4640

commission receivable
income statement

5060

income statement
commission receivable

4640

income statement
commission receivable

5060

credit
$
4640
5060
4640
5060

15 Nula’s financial year ends on 31 December. She maintains a provision for doubtful debts of 5%
of trade receivables.
On 1 January 2021, the provision amounted to $800. On 31 December 2021, trade receivables
owed $13 400, of which $600 was regarded as irrecoverable.
How much was the provision for doubtful debts on 1 January 2022?
A

$600

$640

$660

0452/12/M/J/22

$670

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16 After the financial statements for the year ended 30 April 2022 had been prepared, a trader
discovered that the closing inventory had been over-valued.
What will be the effect of this error?
profit for the year
ended 30 April 2022

capital on
30 April 2022

profit for the year
ending 30 April 2023

overstated

understated

overstated

understated

no effect

understated

no effect

understated

overstated

17 Mariam owns a business providing accounting services. She provided the following information
for the financial year ended 31 March 2022.
$
fees owed by clients on 1 April 2021

4 500

fees received from clients during the year ended 31 March 2022
fees owed by clients on 31 March 2022

22 500
1 500

What was the amount of fees shown in the income statement for the year ended 31 March 2022?
A

$19 500

$22 500

$25 500

$28 500

18 Which item would not appear in the appropriation account of a partnership?
A

interest charged on partners’ drawings

interest paid on loans from partners

interest paid on partners’ capital

salaries paid to partners

19 Carol and Denise are in partnership sharing profits and losses in the ratio 2 : 1.
Denise’s current account balances were as follows.
at 1 May 2021

$2000 debit

at 1 May 2022

$7000 credit

She had made no drawings during the year.
What was the total profit made by the partnership in the year ended 30 April 2022?
A

$9000

$15 000

$18 000

0452/12/M/J/22

$27 000

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20 Which statements are correct?

A debenture holder of a limited company is liable for the debts of the company.

A partner is liable to pay business debts from personal assets.

A shareholder of a limited company is responsible for the company’s debts.

A sole trader is responsible for all the debts of his business.

1 and 2

1 and 3

2 and 4

3 and 4

21 The draft financial statements of a limited company showed retained earnings of $31 820. It was
then found that no adjustment had been made for the following.
$
commission receivable accrued

450

insurance prepaid

175

What was the correct amount of the retained earnings?
A

$31 195

$31 545

$32 095

$32 445

22 Which statement about club accounts is correct?
A

Capital and revenue transactions are recorded in the income and expenditure account.

Non-cash transactions are recorded in the income and expenditure account.

Only revenue transactions are recorded in the receipts and payments account.

The closing balance in the receipts and payments account represents a surplus or deficit.

23 A sports club provided the following information for the financial year ended 31 December 2021.
$
1 January 2021 subscriptions paid in advance

200

31 December 2021 subscriptions outstanding

450

subscriptions received during the year

8800

What was the total of the subscriptions that related to the year ended 31 December 2021?
A

$8150

$8550

$9050

0452/12/M/J/22

$9450

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24 The work in progress of ZT Manufacturers on 1 January was valued at $6200. At the end of the
year it was valued at $5400.
What was the effect on the cost of production for the year?
A

decrease $800

decrease $11 600

increase $800

increase $11 600

25 A manufacturing company provided the following information.
$
cost of production

345 000

finished goods 1 January 2021

42 000

31 December 2021

36 000

purchases of finished goods

15 000

What was the cost of sales?
A

$324 000

$336 000

$351 000

$366 000

26 Tahir provided the following information for his first year of trading.
$
sales

170 000

sales returns
purchases

6 000
129 000

Tahir’s gross margin was 25%.
What was the value of closing inventory?
A

$1000

$2200

$6000

$7500

27 A business provided the following information.
opening inventory

$6800

closing inventory

$6000

rate of inventory turnover

5 times

What were the purchases for the year?
A

$29 200

$31 200

$32 000

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$32 800

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28 A trader provided the following information at the end of the financial year.
$
revenue

80 000

gross profit

20 000

expenses

12 000

What was the profit margin?
A

10%

15%

25%

40%

29 A trader provided the following information.
$
profit for the year

24 000

working capital

20 000

capital

120 000

non-current liability

30 000

What was the return on capital employed?
A

14.12%

16.00%

17.14%

20.00%

30 Samuel, a trader, decided to issue statements of account each month.
Which ratio does Samuel hope to improve by doing this?
A

current ratio

liquid (acid test) ratio

trade payables turnover

trade receivables turnover

31 John’s rate of inventory turnover was 10 times in year 1 and 8 times in year 2.
What may have caused the change in the rate of inventory turnover?
A

fall in demand

higher sales

lower inventory levels

lower selling price

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32 Maya had annual revenue of $100 000.
In year 1, her gross margin was 45% and her profit margin was 5%.
In year 2, her gross margin was 40% and her profit margin was 3%.
What happened to Maya’s cost of sales and expenses in year 2?
cost of sales

expenses

decreased

increased

decreased

increased

33 Why would a bank manager be interested in the financial statements of a business?
A

to calculate and assess the trade payables turnover

to check that the correct amount of tax is being paid

to ensure that employees are being paid the correct hourly rate

to ensure that funds are sufficient to cover loan interest

34 ‘Revenue should only be regarded as earned when the legal title of goods and services passes
from the seller to the buyer.’
To which accounting principle does this statement refer?
A

going concern

matching

money measurement

realisation

35 ‘The information provided in financial statements should be capable of being independently
verified.’
To which accounting policy does this statement refer?
A

comparability

relevance

reliability

understandability

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publisher will be pleased to make amends at the earliest possible opportunity.
To avoid the issue of disclosure of answer-related information to candidates, all copyright acknowledgements are reproduced online in the Cambridge
Assessment International Education Copyright Acknowledgements Booklet. This is produced for each series of examinations and is freely available to download
at www.cambridgeinternational.org after the live examination series.
Cambridge Assessment International Education is part of Cambridge Assessment. Cambridge Assessment is the brand name of the University of Cambridge
Local Examinations Syndicate (UCLES), which is a department of the University of Cambridge.

0452/12/M/J/22

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