Online Access Free BA3 Exam Questions

A trial balance should be extracted from the ledger accounts prior to preparing the final accounts because:

• A.It confirms the arithmetical accuracy of the entries made in the ledger accounts
• B.It proves that the entries made in the ledger accounts are all correct
• C.It provides a summary of assets and liabilities
• D.It shows where errors have been made

An invoice to Sammy has been entered in the sales day book as $85 instead of $58.
To correct the position, which of the following procedures should be adopted?

• A.Debit Receivables $27, Credit Sales $27 and decrease the balance owing by Sammy
• B.Debit Receivables $27, Credit Sales $27 and increase the balance owing by Sammy
• C.Debit Sales $27, Credit Receivables $27 and increase the balance owing by Sammy
• D.Debit Sales $27, Credit Receivables $27 and decrease the balance owing by Sammy

External auditors are primarily responsible for:

• A.Detecting errors and fraud
• B.Preparing the financial accounts
• C.Determining that the accounts show a fair representation of the affairs of the company
• D.Checking the accuracy of all entries in the accounting system

Which one of the following would not be classified as an efficiency ratio?

• A.Non-current asset turnover ratio
• B.Current ratio
• C.Payables days
• D.Inventories days

Which one of the following best describes the purpose of an external audit of financial statements?

• A.The auditor checks the statements for evidence of fraud.
• B.The auditor expresses an opinion on the truth and fairness of the financial statements.
• C.The auditor advises on the use of International Financial Reporting Standards.
• D.The auditor expresses an opinion on corporate governance issues.