ACCA-FA1 practice questions-chapter 1

Here are the ACCA FA1 practice questions which will help you to clear all the concepts related to the chapter (Business transaction and documentation), So here we go with the first question.

Q1. Business is an organization that provides _____for making a profit.

1. services and goods
2. furniture
3. business assets
4. loan

Q2. Companies have usually _____?

1. unlimited liability
2. limited liability
3. common liability
4. fast paying liability

Q3. An organization that has specified or common ____ is an____.

Fill in the blanks

1. entity, goal
2. goal, entity
3. business, company
4. company, business

Q4. ___ is not constituted as business

1. entity
2. business
3. company
4. firm

Q5. Business is always____ from its entity

1. combine
2. separate
3. legal
4. joined

Q6. A dual effect in financial transactions means?

1. every debit has a credit
2. every debtor has a creditor
3. companies are usually limited
4. partnership and sole trader

Q7. internal document means ___within business

1. important
2. not important
3. confidential
4. no use of

Q8. an ___ document can use be used outside the organization.

1. internal
2. external
3. invoices
4. quotation

Q9. staff timesheet is an example of ____

1. internal document
2. external document
3. invoice
4. quotations

Q10. letter of inquiry is an example of ___

1. internal document
2. external document
3. invoice
4. quotations

Note: Business transactions and documentation Must read it

Q11. demanding for payment is known as __

1. invoice
2. document
3. quotation
4. GRN

Q12. Usually, invoice shows__

1. bank balance
2. invoice number
3. NIC number
4. GRN number

Q13. FOB stands for___

1. the free on a branch
2. free on board
3. free on bulk

Q14. credit note is usually sent by __

1. customer
2. supplier
3. company
4. friend

Q15. debit note is sent by__

1. supplier
2. customer
3. friend
4. company

Q16. E stand for electronic commerce and commerce means__

1. exchanging money
2. exchanging goods
3. online website
4. electronic application

Q17. reduction in cash or amount payable when you pay for goods, what does it means in accounting?

1. cash discount
2. sales discount
3. trade discount

Q18. reduction on goods you purchase usually when you purchase in bulk quantity.

1. Trade discount
2. cash discount
3. sales discount

Q19. purchase goods in cash at 2000$, calculate the amount of discount if the trade discount is 10%

1. 300
2. 400
3. 200
4. 100

Q20. Honey buys a car with a list price of 50000$, the trade discount is 10%, and if honey pay within a week he will receive a 10% settlement/cash discount. (this statement relates to Q21 as well)

Calculate trade discount

1. 500
2. 1500
3. 2500
4. 5000

Q21. Calculate cash discount

1. 2500
2. 3500
3. 4500
4. 5500

Q22. obligation which will have to pay to the government whenever making any sale, this statement relates to

1. income tax
2. property tax
3. sales tax
4. utility tax

Q23. Mumford sells an asset worth 70000, calculate sales tax if it is 13%

1. 9400
2. 9300
3. 9200
4. 9100

Answers (ACCA FA1 Practice Questions)

here you can find the answers

1. services and goods
2. limited liability
3. goal, entity
4. firm
5. separate
6. every debit has a credit
7. confidential
8. external
9. internal document
10. external document
11. invoice
12. invoice number
13. free on board
14. supplier
15. customer
16. exchanging goods
17. cash discount
18. Trade discount
19. 200 (2000*10/100)
20. 5000 (5000*10/100)
21. 4500 (50000-5000 trade discount, remaining 45000*10/100)
22. sales tax
23. 9100 (70000*13/100)

FAQS

What is the full form of FA1 in ACCA?

FA1 means Recording Financial Transaction in ACCA, it is the very first paper of ACCA. It is the paper of the foundation level.

What are the passing marks in FA1?

The passing marks of FA1 and the whole qualifications of ACCA are 50%. It is not much difficult to achieve the 50% in an ACCA paper but you need to learn each and every topic with a solid understanding.

How many papers are there at the foundation level in ACCA?

There are four basic papers in the foundation of ACCA, those papers are the followings:

1. FA1, Recording Financial Transaction
2. FA2, Maintaining Financial Records
3. MA1, Management Information
4. MA2, Managing Cost And Finance

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Must read this chapter before doing questions it will help you to catch difficult points.

Business transaction and documentation-FA1(ACCA)