These are ACCA F3 (FA/FFA) Financial Accounting MCQs for Part-D of the Syllabus “Recording transactions and events”.

These multiple-choice questions (MCQs) are designed to help ACCA F3 students to better understand the exam format. We aim to instill in students the habit of practicing online for their CBE exams. By doing so, students can reduce exam stress and prepare more effectively.

Please note:

Students should not attempt these MCQs until they have finished the entire chapter.
All questions are compulsory, so please do not skip any.

We hope that these MCQs will be a valuable resource for students preparing for the ACCA F3 (FA/FFA) exam.

INFORMATION ABOUT THESE CBE MCQs Test/Quiz

Course:	ACCA – Associations of Chartered Certified Accountants
Fundamental Level:	Knowledge, FIA – Foundation in Accounting
Subject:	Financial Accounting
Paper:	F3 – FA/FFA
Chapter:	Receivables and payables
Chapter Number:	11 of the Practice and Exam Kit
Syllabus Area:	D – “Recording transactions and events”
Questions Type:	CBE MCQs
Exam Section:	Section A

Syllabus Area

These Multiple Choice Questions (MCQs) cover the Syllabus Area Part D of the Syllabus; “Recording transactions and events” of ACCA F3 (FA/FFA) Financial Accounting Module.

Time

These MCQs are not time-bound. Take your time and solve them without stress. Pay proper attention and focus. Do not rush or hesitate

Result

Students will get their F3 CBE MCQs Test results after they finish the entire test. They will also be able to see the correct and incorrect answers, as well as explanations for the incorrect questions.

Types of Questions

MCQs: Choose one from the given options.
Multiple choice: Choose all those answers which seem correct/ or incorrect to you, as per the requirement of the question. Keep your eye on the wording “( select all those which are correct/ or incorrect)“.
Drop-down: Select from the list provided.
Type numbers: Type your answer in numbers as per the requirement of the question.

Keywords

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F3 - Chapter 11 - Part A - MCQs

Course: ACCA - FIA
Subject: F3 (FA/FFA) Financial Accounting
Syllabus Area: D - Recording transactions and events
Chapter in Kit: 11 - Receivables and payables
Exam Section: Section A
Questions type: MCQs
Time: No Time Limit

INSTRUCTIONS

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1 / 20

A company has been notified that a customer has been declared bankrupt. The company had previously made an allowance for this debt.

Which of the following is the correct double entry to account for this new information?

DEBIT Irrecoverable debts ;- CREDIT Receivables

DEBIT Allowance for receivables ;- CREDIT Receivables

DEBIT Receivables ;- CREDIT Irrecoverable debts

DEBIT Receivables ;- CREDIT Allowance for receivables

2 / 20

An increase in an allowance for receivables of $8,000 has been treated as a reduction in the allowance in the financial statements.

Which of the following explains the resulting effects?

Gross profit overstated by $16,000, receivables overstated by $16,000

Net profit is overstated by $16,000, receivables overstated by $8,000

Net profit overstated by $16,000, receivables overstated by $16,000

Net profit understated by $16,000, receivables understated by $16,000

3 / 20

At 31 December 20X4 a company's trade receivables totalled $864,000 and the allowance for receivables was $48,000.

It was decided that debts totalling $13,000 were to be written off. The allowance for receivables was to be adjusted to the equivalent of five per cent of the receivables.

What figures should appear in the statement of financial position for trade receivables (after deducting the allowance) and in the statement of profit or loss for receivables expense?

Option D

Option B

Option A

Option C

4 / 20

A company has received cash for a debt that was previously written off.

Which of the following is the correct double entry to record the cash received?

DEBIT Irrecoverable debts expense ;- CREDIT Accounts receivable

DEBIT Allowance for receivables ;- CREDIT Accounts receivable

DEBIT Cash ;- CREDIT Allowance for receivables

DEBIT Cash ;- CREDIT Irrecoverable debts expense

5 / 20

At 30 September 20X2 a company's allowance for receivables amounted to $38,000, which was equivalent to five per cent of the receivables at that date.

At 30 September 20X3 receivables totalled $868,500. It was decided to write off $28,500 of debts as irrecoverable. The allowance for receivables required was to be the equivalent of five per cent of receivables.

What should be the charge in the statement of profit or loss for the year ended 30 September 20X3 for receivables expense?

$_______

6 / 20

Which of the following would a decrease in the allowance for receivables result in?

An increase in net profit

A decrease in working capital

A decrease in net profit

An increase in liabilities

7 / 20

At 31 December 20X2 a company's receivables totalled $400,000 and an allowance for receivables of $50,000 had been brought forward from the year ended 31 December 20X1.

It was decided to write off debts totalling $38,000. The allowance for receivables was to be adjusted to the equivalent of 10% of the receivables.

What charge for receivables expense should appear in the company's statement of profit or loss for the year ended 31 December 20X2?

$28,000

$74,200

$24,200

$51,800

8 / 20

Which one of the following statements is NOT a benefit of offering credit facilities to customers?

Fewer irrecoverable debts

Improved convenience for the customer

Provides time for appropriate payment approval procedures

The separation of product and service delivery from payment

9 / 20

At 1 July 20X3 a limited liability company had an allowance for receivables of $83,000.

During the year ended 30 June 20X4 debts totalling $146,000 were written off. At 30 June 20X4 a receivables allowance of $218,000 was required.

What figure should appear in the company's statement of profit or loss for the year ended 30 June 20X4 for receivables expense?

$11,000

$281,000

$364,000

$155,000

10 / 20

What is the correct double entry for discounts received?

DEBIT Payables control account ;- CREDIT Expenses

DEBIT Expenses ;- CREDIT Payables control account

DEBIT Discounts received (income) ;- CREDIT Payables control account

DEBIT Payables control account ;- CREDIT Discounts received (income)

11 / 20

Which of the following is/are examples of payables of a business?

Interest owed from the bank
Loans and advances to employees
Money owed from customers
Tax owed to the tax authority

1 and 3 only

2 and 3 only

2 and 4 only

4 only

12 / 20

A business commenced trading on 01 January 20X1. The following transactions with Supplier A have been recorded in the purchase ledger.

On 31 March 20X1, the business receives the following statement from the supplier.

Which transactions should be noted as reconciling items on the supplier statement reconciliation at 31 March 20X1?

1 to 6

3 and 6 only

6 only

3 only

13 / 20

At 1 July 20X2 the receivables allowance of Q was $18,000.

During the year ended 30 June 20X3 debts totalling $14,600 were written off. The receivables allowance required was to be $16,000 as at 30 June 20X3.

What amount should appear in Q's statement of profit or loss for receivables expense for the year ended 30 June 20X3?

$48,600

$12,600

$16,600

$30,600

14 / 20

Which of the following is/are examples of payables of a business?

An estimation of tax owed to the tax authority for the year just ended
$500 owed to a supplier for invoiced goods
An estimation of probable repair costs under warranty claims

1 and 3 only

1, 2 and 3

1 and 2 only

2 only

15 / 20

At 1 January 20X1, there was an allowance for receivables of $3,000. During the year, $1,000 of debts were written off as irrecoverable, and $800 of debts previously written off were recovered. At 31 December 20X1, it was decided to adjust the allowance for receivables to 5% of receivables which are $20,000.

What figure should be included in the statement of profit or loss as the receivables expense for the year?

$__________ DEBIT / CREDIT

$2,800 CREDIT

$1,800 DEBIT

$2,800 DEBIT

$1,800 CREDIT

16 / 20

At the beginning of the year, the allowance for receivables was $850. At the year-end, the allowance required was $1,000. During the year $500 of debts were written off, which includes $100 previously included in the allowance for receivables.

What is the charge to statement of profit or loss for receivables expense for the year?

$550

$1,500

$1,000

$650

17 / 20

Which TWO of the following statements are CORRECT?

A credit limit is a tool applied by the credit control department to make suppliers provide goods on time.

Credit limits are applied to customers who purchase goods using cash only.

Receivables are included in the statement of financial position net of the receivables allowance.

An aged receivables analysis shows how long invoices for each customer have been outstanding.

18 / 20

Which of the following statements is TRUE.

Receivables represent money owed to the business.

Payables represent money the business owes.

Payables are an asset.

19 / 20

At 31 May 20X7 Roberta's trial balance included the following items.

What is the value of Roberta's current liabilities at 31 May 20X7?

$61,597

$53,020

$76,597

$38,020

20 / 20

Top Co has total receivables outstanding of $280,000. The accountant believes that approximately 1% of these balances will not be collected, so wishes to make an allowance of $28,000. No previous allowance has been made for receivables.

Which of the following is the correct double entry to create this allowance?

DEBIT Receivables ;- CREDIT Allowance for receivables

DEBIT Irrecoverable debts ;- CREDIT Receivables

DEBIT Irrecoverable debts ;- CREDIT Allowance for receivables

DEBIT Allowance for receivables ;- CREDIT Receivables

Your score is

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F3 (FA/FFA) – Chapter 11 – PART D – CBE MCQs – ACCA