Gce Model Questions Vol1 2020 Financial Accounting Question 27
Practice objective / multiple choice question 27 from the 2020 Gce Model Questions Vol1 Financial Accounting examination.
At the start of the financial year a local authority prepared a cash budget for a particular service. The budget estimated cash receipts of £150,000 and cash payments of £130,000, giving an expected cash surplus of £20,000. At year‑end the actual cash receipts were £140,000 and cash payments were £135,000. In addition, accrued revenues of £8,000 had been earned but not yet received, accrued expenses of £5,000 had been incurred but not yet paid, and depreciation expense of £12,000 had been recorded (non‑cash).\n\nCalculate (a) the cash surplus, (b) the surplus (or deficit) on an accrual basis, and (c) state whether the authority has a cash surplus or an accrual surplus/deficit and by how much.
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About This Question
This is Gce Model Questions Vol1 2020 Financial Accounting Question 27. It is one of the objective questions from the 2020 Gce Model Questions Vol1 Financial Accounting examination.
Difficulty level: Hard .
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