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Before attempting this assignment you should have read chapters 1 to 3 of your Osborne Book ”WORKING EFFECTIVELY IN ACCOUNTING” Tutorial and attempted the relevant chapter activities in your WORKBOOK. The pass mark for the assignment is 70% - should you fail then please review the areas where you are weak. If you are still having problems then please do not hesitate to contact AATFree.
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Questions and Answers
1.
Recording, analysing and reporting financial information is called:
A.
Finance
B.
Accounting
C.
Auditing
D.
Taxation
Correct Answer B. Accounting
Explanation Accounting involves the process of recording, analyzing, and reporting financial information. It encompasses activities such as bookkeeping, preparing financial statements, and interpreting financial data to provide insights into the financial health and performance of an organization. Accounting is essential for decision-making, planning, and controlling the financial resources of a business. It helps in assessing profitability, liquidity, and solvency, and ensures compliance with financial regulations and standards.
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2.
Analysis and reporting of past financial transactions in financial
statements, is called:
A.
Financial accounting
B.
Management accounting
Correct Answer A. Financial accounting
Explanation Financial accounting involves the analysis and reporting of past financial transactions in the form of financial statements. These statements provide a summary of a company's financial activities, including its income, expenses, assets, and liabilities. Financial accounting is essential for external stakeholders such as investors, creditors, and regulators, as it provides them with accurate and reliable information about the company's financial performance and position. This information helps stakeholders make informed decisions and assess the company's financial health. Management accounting, on the other hand, focuses on providing internal stakeholders with information for decision-making and planning purposes.
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3.
Providing past and projected financial information for
managers to help with planning, decision making and control, is called:
A.
Financial accounting
B.
Bookkeeping
C.
Management accounting
D.
Auditing
Correct Answer C. Management accounting
Explanation Management accounting involves providing past and projected financial information to managers to assist them in planning, decision making, and control. This includes analyzing and interpreting financial data, preparing budgets, and conducting variance analysis. It focuses on providing internal stakeholders with the necessary information to make informed business decisions and achieve organizational goals. Financial accounting, on the other hand, focuses on providing information to external stakeholders such as investors, creditors, and regulatory authorities. Bookkeeping involves recording and organizing financial transactions, while auditing involves examining financial records to ensure accuracy and compliance.
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4.
A person or organisation that has an interest in the financial
performance of a business, is called a stakeholder.
A.
True
B.
False
Correct Answer A. True
Explanation A stakeholder is a person or organization that has a vested interest in the financial performance of a business. This means that they have a stake in the success or failure of the business and may be affected by its financial outcomes. Stakeholders can include shareholders, employees, customers, suppliers, and even the local community. They have a direct or indirect impact on the business and its financial well-being, making them important to consider and engage with in order to ensure the overall success and sustainability of the business.
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5.
External checking of the financial records by independent Accountants is called:
A.
Auditing
B.
Bookkeeping
C.
Mananging
D.
Taxing
Correct Answer A. Auditing
Explanation Auditing refers to the external checking of financial records by independent accountants. This process involves reviewing and evaluating financial statements, transactions, and records to ensure accuracy, compliance with regulations, and proper financial reporting. Auditing helps to provide assurance to stakeholders, such as investors, creditors, and regulators, about the reliability and integrity of the financial information presented by an organization. It helps to detect any errors, fraud, or discrepancies in the financial records and ensures transparency and accountability in financial reporting.
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6.
The line of communication between different levels within an Organisation is called the reporting line.
A.
True
B.
False
Correct Answer A. True
Explanation The statement is true because the reporting line refers to the channels of communication within an organization that connect different levels of management. It is the pathway through which information, instructions, and feedback flow from higher-level managers to lower-level employees and vice versa. This line of communication ensures that there is a clear and structured flow of information within the organization, allowing for effective coordination and decision-making.
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7.
Achieving the right result with the minimum of wasted time, effort or expense is called 'solvency'
A.
True
B.
False
Correct Answer B. False
Explanation efficiency
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8.
________ means paying debts when they become due. (it begins with 's')
Correct Answer solvency solvent liquidity
Explanation Solvency refers to the ability of a person or organization to pay off their debts when they are due. It is a measure of financial stability and indicates that the entity has enough assets to cover its liabilities. Similarly, being solvent means having enough assets to cover debts. On the other hand, liquidity refers to the availability of cash or assets that can be easily converted into cash. While all three terms are related to financial stability, solvency specifically refers to the ability to pay debts when they become due.
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9.
Organisations should draw up formal policies and ___________ which are documents which regulate a wide variety of areas of the business, for example accounting records and accounting procedures, health and safety in the workplace, confidentiality and conduct.
Correct Answer procedures
Explanation Organizations should draw up formal policies and procedures which are documents that regulate a wide variety of areas of the business. Procedures provide specific instructions and guidelines on how tasks should be performed, ensuring consistency and efficiency in operations. They outline step-by-step processes and actions to be followed, such as accounting records and procedures, health and safety protocols, confidentiality measures, and codes of conduct. By implementing procedures, organizations can maintain compliance, promote transparency, and establish clear expectations for employees, ultimately enhancing overall organizational effectiveness.
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10.
The accounting and finance function will be subject to external regulations, some of them set down in law, which must be complied with. Failure to do so may result in fines and extra work by accounting and finance staff.
A.
True
B.
False
Correct Answer A. True
Explanation The explanation for the correct answer is that the accounting and finance function is indeed subject to external regulations, some of which are legally mandated. These regulations must be followed to avoid penalties, fines, and additional workload for the accounting and finance staff.
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11.
Policies and procedures also affect the working area in the accounting and finance function. Strict regulation of issues such as health and _______, organisation of the workspace, secure storage of documents and confidentially of information must be complied with if the organisation is to remain efficient.
Correct Answer safety
Explanation Policies and procedures in the accounting and finance function have a direct impact on the working area. Strict regulation of issues such as health and safety is necessary to ensure the well-being of employees and maintain an efficient workspace. It includes organizing the workspace in a way that promotes productivity, ensuring secure storage of documents, and maintaining confidentiality of information. By adhering to safety regulations, the organization can create a conducive environment for its employees and protect sensitive information.
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12.
• Guidance policies and procedures may also be drawn up by the organisation to ensure that the office becomes ‘green’ – in other words ____________________ friendly.
Correct Answer environmentally
Explanation The given answer "environmentally" completes the sentence by stating that the guidance policies and procedures aim to make the office "green" or environmentally friendly. This implies that the organization wants to implement practices that are sustainable and minimize negative impacts on the environment.
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13.
The day-to-day funds that a business has available to pay debts when they are due is called
A.
Efficiency
B.
Accountancy
C.
Solvency
D.
Working capital
Correct Answer D. Working capital
Explanation Working capital refers to the day-to-day funds that a business has available to pay its debts when they are due. It represents the difference between a company's current assets and its current liabilities. By maintaining adequate working capital, a business can ensure that it has enough liquidity to meet its short-term financial obligations and continue its operations smoothly. Therefore, working capital is the correct answer in this context.
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14.
Regulations set down by an organisation for the running of defined areas of activity, eg payroll, are called
A.
Health and safety
B.
Policies and procedures
C.
Data protection
Correct Answer B. Policies and procedures
Explanation Policies and procedures refer to the regulations set by an organization for the running of defined areas of activity, such as payroll. These policies and procedures outline the guidelines and steps that need to be followed to ensure smooth operations and compliance with the organization's standards and objectives. They provide a framework for employees to understand their roles and responsibilities and ensure consistency and fairness in decision-making processes.
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15.
The need for all employees not to reveal any information relating to customers and other employees to people who are not authorised to have that information, is called
A.
Confidentiality
B.
Data protection
C.
Health and safety
D.
Payroll
Correct Answer A. Confidentiality
Explanation Confidentiality refers to the requirement for employees to keep sensitive information about customers and colleagues private and not disclose it to unauthorized individuals. This ensures the protection of personal and sensitive data, maintaining privacy and trust. It is crucial in maintaining the security and integrity of the organization and its stakeholders.
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16.
The legal requirements not to reveal without authorisation personal information held on computer or on paper records by an organisation, is called ____ _________
Correct Answer data protection data protection act
Explanation The legal requirements not to reveal personal information without authorization held by an organization, whether it is stored on a computer or on paper records, is known as data protection. This includes the protection of individuals' personal data from unauthorized access, use, or disclosure. The Data Protection Act is a specific legislation that sets out the legal framework for data protection in a particular jurisdiction, outlining the rights and responsibilities of organizations and individuals regarding the processing and storage of personal data.
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17.
‘Per Cent’ means ‘out of every hundred,’ so a percentage is the top number of a fraction where the bottom number
is ___
A.
100
B.
1
C.
10
D.
0.100
Correct Answer A. 100
Explanation The correct answer is 100 because a percentage is a fraction where the top number represents a certain amount out of every hundred. In other words, it is a ratio out of 100. Therefore, the bottom number in the fraction representing a percentage is always 100.
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18.
Decimal place means the number of digits to the _____ of the decimal point.
Correct Answer right
Explanation The correct answer is "right" because when we refer to the decimal place, we are talking about the number of digits that appear to the right of the decimal point. The decimal point acts as a separator between the whole number part and the fractional part of a decimal number.
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19.
Mean average is the sum of a series of figures multiplied by the number of figures.
A.
True
B.
False
Correct Answer B. False
Explanation divided by the number of figures
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20.
A series of data collected regularly over a period of time, eg annual sales figures is called a ____ ______
Correct Answer time series
Explanation A series of data collected regularly over a period of time, such as annual sales figures, is referred to as a time series. This term is used to describe a set of observations or measurements taken at different points in time and can be analyzed to identify patterns, trends, and relationships over time. Time series analysis is commonly used in various fields, including economics, finance, and forecasting, to make predictions and inform decision-making.
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21.
A circle divided into sectors to represent in the correct proportion the parts of a whole – like a cake divided into ‘slices’, is called a ___ _____
Correct Answer pie chart pie diagram
Explanation A circle divided into sectors to represent in the correct proportion the parts of a whole, like a cake divided into 'slices', is called a pie chart or pie diagram.
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22.
Calculate the 'mean' hourly rate of employees’ pay from the following figures:
Alfie £12.50
Beth £9.75
Colin £12.60
Don £7.85
Elsie £8.70
Felix £12.00
George £10.50
Hannah £11.90
Correct Answer Â£10.72 Â£10.73 10.72 10.73
Explanation The mean hourly rate of employees' pay can be calculated by finding the average of all the given hourly rates. Adding up all the hourly rates and dividing it by the total number of employees gives the mean hourly rate. In this case, the sum of all the hourly rates is Â£96.60 and there are 9 employees. Dividing Â£96.60 by 9 gives a result of Â£10.7333, which can be rounded to Â£10.73. Therefore, the correct answer is Â£10.73.
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23.
Asam took 7 maths tests and got scores of 68, 71, 71, 84, 53, 62 and 67. What was Asam's mode score?
A.
63
B.
68
C.
71
Correct Answer C. 71
Explanation The mode is the score that appears most frequently in the set of scores. In this case, the score of 71 appears twice, which is more than any other score. Therefore, the mode score is 71.
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24.
What is the mean average of these numbers: 18, 12, 10, 10, 25?
A.
10
B.
12
C.
15
Correct Answer C. 15
Explanation The mean average is calculated by adding up all the numbers and then dividing the sum by the total number of numbers. In this case, the sum of the numbers 18, 12, 10, 10, and 25 is 75. Since there are 5 numbers, dividing the sum by 5 gives us an average of 15. Therefore, the correct answer is 15.
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25.
The mean average of three numbers is 8. Two of the numbers are 11 and 7. What is the third number?
A.
6
B.
7
C.
8
Correct Answer A. 6
Explanation The mean average of three numbers is calculated by adding up all the numbers and then dividing the sum by the total number of numbers. In this case, the sum of the three numbers is 11 + 7 + x, where x is the third number. Since the mean average is given as 8, we can set up the equation (11 + 7 + x) / 3 = 8. Solving for x, we get x = 6. Therefore, the third number is 6.
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26.
The temperature in degrees Celsius over 4 days in July was 27, 27, 30 and 32. What was the mean temperature?
A.
27 degrees Celsius
B.
29 degrees Celsius
C.
31 degrees Celsius
Correct Answer B. 29 degrees Celsius
Explanation The mean temperature is calculated by finding the average of the temperatures over the 4 days. To do this, we add up all the temperatures and then divide the sum by the number of temperatures. In this case, the sum of the temperatures is 27 + 27 + 30 + 32 = 116. Dividing 116 by 4 (the number of temperatures) gives us 29 degrees Celsius as the mean temperature.
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27.
What is the mode of these numbers: 75, 78, 75, 71, 78, 25, 75, 29?
A.
25
B.
75
C.
78
Correct Answer B. 75
Explanation The mode of a set of numbers is the value that appears most frequently. In this case, the number 75 appears three times, which is more than any other number in the set. Therefore, the mode of these numbers is 75.
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28.
Five children have heights of 138 cm, 135 cm, 140 cm, 139 cm and 141 cm. What is the range of their heights?
A.
6
B.
7
C.
8
Correct Answer A. 6
Explanation The range of a set of numbers is the difference between the largest and smallest numbers in the set. In this case, the largest height is 141 cm and the smallest height is 135 cm. Therefore, the range of their heights is 141 cm - 135 cm = 6 cm.
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29.
What is the median of these numbers: 2.4, 2.8, 2.3, 2.9, 2.9?
A.
2.3
B.
2.8
C.
2.9
Correct Answer B. 2.8
Explanation The median is the middle value in a set of numbers when they are arranged in order. In this case, when the numbers are arranged in ascending order, we have 2.3, 2.4, 2.8, 2.9, 2.9. The middle value is 2.8, which is the median.
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30.
The cost of five cakes is 28p, 19p, 45p, 45p, 15p. What is the median cost?
A.
28p
B.
15p
C.
45p
Correct Answer A. 28p
Explanation The median is the middle value when the data is arranged in ascending or descending order. In this case, the data is already given in ascending order: 15p, 19p, 28p, 45p, 45p. The middle value is 28p, so that is the median cost.
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31.
What is the median of these numbers: 10, 3, 6, 10, 4, 8?
A.
6
B.
7
C.
8
Correct Answer B. 7
Explanation The median is the middle value of a set of numbers when they are arranged in ascending or descending order. In this case, the numbers are 3, 4, 6, 8, 10, 10. Since there are six numbers, the middle value is the average of the two middle numbers, which are 6 and 8. Therefore, the median is 7.
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32.
Based on the graph of China's energy consumption, which of the following is true?
A.
China has consumed less energy in recent years
B.
1975 was the year in which the most energy was consumed
C.
China consumed more than 2,000,000 kilowats of energy
D.
In the year 2000, China consumed nearly 300 times as much energy as it did in 1950
Correct Answer D. In the year 2000, China consumed nearly 300 times as much energy as it did in 1950
Explanation In the given graph of China's energy consumption, the answer is supported by the data shown. The graph indicates that China's energy consumption has significantly increased over the years. In 1950, the energy consumption was relatively low, while in the year 2000, it experienced a steep rise, reaching nearly 300 times the consumption in 1950. Therefore, the statement that in the year 2000, China consumed nearly 300 times as much energy as it did in 1950 is true based on the graph.
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33.
According to the graph, which continent had the highest growth rate?
A.
Africa
B.
North America
C.
Europe
D.
Oceania
Correct Answer A. Africa
Explanation According to the graph, Africa had the highest growth rate. This can be concluded by analyzing the data presented in the graph, which likely shows the growth rates of different continents over a certain period of time. By comparing the growth rates of Africa, North America, Europe, and Oceania, it can be determined that Africa had the highest growth rate among these continents.
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34.
According to the chart, which continent has the highest percentage of the world's population?
A.
Africa
B.
Europe
C.
Asia
D.
North America
Correct Answer C. Asia
Explanation Asia has the highest percentage of the world's population according to the chart. This can be inferred by analyzing the data provided in the chart and comparing the population numbers of each continent.
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