ACCA F6 Chapter 3

15 Questions | By LFTC2011 | Updated: Mar 21, 2022 | Attempts: 96

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From BPP study text, this is the quiz for ACCA Chapter 3 "Employment Income".

Questions and Answers

1.

Contract for services is _______________.
- A.
  
  Employment
- B.
  
  Self-employment
2.

A provides his services to B. B must offer work to A and A must perform the work. The arrangement is:
- A.
  
  Employment
- B.
  
  Self-employment
3.

A works for B and brings his own equipment and hires his own personnel when additional work is required, although B pays him extra charges for the additional workforce. This is an arrangement of:
- A.
  
  Employment
- B.
  
  Self-employment
4.

A works with B. He opened a new branch of B’s restaurant and invested 50% of the cost. He will share the profit and loss 50:50. This is:
- A.
  
  Employment
- B.
  
  Self-employment
5.

For the month of March, B pays £1,234 to A. The amount was for the wages of A between 1-31 March but was calculated on 5 April and paid on 7 April. The wages are deemed to have been earned by A on:
- A.
  
  31 March
- B.
  
  5 April
- C.
  
  7 April
6.

A is a director in B Plc. B Ltd. Prepare its annual accounts to every 31 December. For the year ending 31 December 2011, A became entitled to £50,000 bonus when he met his pre-agreed targets on 30 November 2011. The company accounted for this bonus in the financial statements prepared for the year ended 31 December 2011 when they compiled their accounts on 31 January 2011. The amount was then paid on 15 April 2012. The date when it is deemed that A received the bonus is:
- A.
  
  30 November 2011
- B.
  
  31 December 2011
- C.
  
  31 January 2012
- D.
  
  15 April 2012
7.

A is a director in B Plc. B Ltd. Prepare its annual accounts to every 31 December. For the year ending 31 December 2011, A became entitled to £50,000 bonus when the accounts were finalized on 31 January 2012 and the performance was considered deserving the bonus on 31/1/12. The company accounted for this bonus in the financial statements prepared for the year ended 31 December 2011 when they compiled their accounts on 31 January 2011. The amount was then paid on 15 April 2012. The date when it is deemed that A received the bonus is:
- A.
  
  â�¢ 30 November 2011
- B.
  
  â�¢ 31 December 2011
- C.
  
  â�¢ 31 January 2012
- D.
  
  â�¢ 15 April 2012
8.

If A earns £10,000 from B during the year and his allowable deductions are £12,000, his net earnings would be:
- A.
  
  Â£22,000
- B.
  
  Â£10,000
- C.
  
  Â£Nil
- D.
  
  Â£(2,000)
9.

Jay is employed by Kay and his duty is to work at his clients. Kay tells Jay everyday where Jay must go for work. The actual travelling expenses of Jay during the tax year were £3,210. How much of the travelling expenses are deductible by Jay if his annual salary is £2,109.
- A.
  
  Nil
- B.
  
  Â£2,109
- C.
  
  Â£3,210
- D.
  
  Â£4,000
10.

1. On 1 June 2007, Ell was told by his company to work in a town 60 miles of the city. He was told to work for 23 months. At the end of 22^nd month, he was asked to work for 3 further months (26 months).
- A.
  
  He can claim the travelling expenditure for entire 26 months
- B.
  
  He can claim the travelling expenditure for the 24 months
- C.
  
  He can claim the travelling expenditure for initial 23 months
- D.
  
  He can claim the travelling expenditure for 22 months
11.

1. Which is the following is not deductible:
- A.
  
  Contributions to registered occupational pension schemes
- B.
  
  Subscription to professional bodies, if relevant to the duties of the employment
- C.
  
  Cost of improvement for home when the employee works from home
- D.
  
  Payment of certain liabilities relating to the employment
12.

Emme travels 3,000 business miles in his private car using his own fuel during the tax years 2011/12 and is paid 35 pence per mile as travelling allowance. The affect on his employment income is that:
- A.
  
  Â£1,050 will be added in his salary
- B.
  
  Â£1,200 will be deducted from his salary
- C.
  
  Â£300 will be added in his salary
- D.
  
  Â£300 will be deducted from his salary
13.

Auo travels 13,000 business miles using his private car and fuel. His company pays him 35 pence per mile. The affect on his employment income is that:
- A.
  
  Â£700 will be added in the employment income
- B.
  
  Â£700 will be deducted from his employment income
- C.
  
  Â£150 will be added in the employment income
- D.
  
  Â£150 will be deducted from his employment income
14.

Zed earns Total Income (NSI) of £40,000. He is considering paying £1,000 through payroll deduction scheme or making a net gift aid donation of £900. The impact on his tax liability will be:
- A.
  
  He will end up with the same tax payments
- B.
  
  He will pay more tax if he opts for Gift Aid Donation
- C.
  
  He will pay less tax if he opts for Payroll Deduction Scheme
- D.
  
  There is not enough information for determining the impact on his tax liability
15.

Zed earns Total Income (NSI) of £40,000. He is considering paying £1,000 through payroll deduction scheme or making a net gift aid donation of £900. The impact on net disposable income will be:
- A.
  
  He will end up with the same net disposable income
- B.
  
  He will have more disposable income if he opts for Gift Aid Donation
- C.
  
  He will have more disposable income if he opts for Payroll Deduction Scheme
- D.
  
  There is not enough information for determining the impact on his disposable income