The Multiple Choice Questions Blog

Maximising the wealth of its shareholders is the stated goal of Alex plc.

The objectives have been expressed as a hierarchy of primary and secondary objectives.

Identify which of the following is most likely to be the primary business objective.

Select ONE answer:

1. To increase the annual profit after tax by %125 in the next 10 years
2. To introduce an average of two new products each year for the next six years
3. To double the share price within the next 10 years
4. To become the market leader in four market segments whithin the next 10 years

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct – To double the share price within the next 10 years is most likely to be the primary business objective. The other three options would be typical secondary objectives for Alex plc in pursuit of the primary objective.
4. Not correct

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Lucy, the managing director of Alex Ltd, has set a primary objective of growth in profits for the company.

She aims to concentrate on product development to support this objective.

Identify whether the following will be suitable secondary objectives to achieve the growth in profits via product development.

i.Bringing in new products

ii.Reducing labour turnover

iii.Investing in research and development

Select ONE answer:

1. i and ii only
2. ii and iii only
3. i and iii only
4. i, ii and iii

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct – Listed under the broad heading of product development, Lucy might choose to bring in new products; develop a product range; invest in research and development; and/or provide products of a certain quality ta a certain price level. If she were concentrating on employees and management to support, her primary objective then she might aim to reduce labour turnover.
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

Recording the purchase of computer stationery by debiting the computer equipment account would result in?

Select ONE answer:

1. An overstatement of profit and an overstatement of non-current assets
2. An understatement of profit and an overstatement of non-current assets
3. An overstatement of profit and an understatement of non-current assets
4. An understatement of profit and an understatement of non-current assets

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct –> An expense has been posted as a non-current asset when it should have been a deduction from profit, non-current assets are overstated as a result.
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

Organisations can be defined or described in various ways.

Which THREE of the following are the key characteristics that are shared by all organisations?

A Synergy
B Social arrangement
C Collective goals
D Specialisation
E Controlled performance
F Exchange of goods and services

Select ONE answer:

1. A, D, F
2. B, D, F
3. B, C, E
4. C, D, E

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct – An organisation is a social arrangement that pursues collective goals, that controls its own performance, and, in addition, that has a boundary separating it from its environment. The other options are all ways that enable an organisation to increase productivity.
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.