ACCA F1 Mock Exam - FREE | PakAccountants.com

CHAPTER

1

Understanding the Understanding the role of Accounting in Business

ACCA F1 FIA FAB

Mock Exam By: Hasaan Fazal

Accountant in Business

UPDATED FOR

2014-15

COPYRIGHT ©2011 – ACCA LIVE | Most affordable online classes for CAT and ACCA

EXAMS

Page | 1

CHAPTER

1

Understanding the role of Accounting in Business

ACCA F1 FIA FAB

Mock Exam

Accountant in Business

COPYRIGHT ©2011 – ACCA LIVE | Most affordable online classes for classes for CAT and ACCA

Page | 2

Mock Exam

ACCA F1 / FIA FAB Accountant in Business

50

Questions

1 An organization is a meaningful group of people working together to achieve ____________ goals A. Individual B. Personal C. Social D. Common

2 Job specialization is the resultant of: A. Centralization B. Delegation C. Work division D. Synergy

3 Division of labour increases: A. Responsibility B. Productivity C. Divisibility D. All of the above

4 The concept of division of labour was proposed by A. Adam smith B. Fredrick Taylor C. Mintzberg D. Webber

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Mock Exam


50

Questions

5 Public sector organization refers to organizations owned by: A. General public B. Government C. Public at large D. All of the above

6 Wide span of control means: A. Long chain of command B. Short chain of command C. More layers of management D. None of the above

7 Span of control and chain of command has _______________ _______________ with each other A. Direct relation B. Congruent relation C. Inverse relation D. No clear relation

8 Setting the direction of the or ganization is the responsibility of: A. Shareholders B. Directors C. Brokers D. Stakeholders



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Mock Exam


50

Questions

9 If we relate Mintzberg Five components of organization’s structure with Anthony’s managerial layers then Operational management under Anthony’s theory is equivalent to _______________ in Mintzberg theory

A. Strategic apex B. Technostructure C. Middle line D. Operating core

10 Which of the following phenomena is the result of advancement in IT? A. Wider span of control B. Delayering C. Reducing need of middle managers D. All of the above

11 Which of the following organizational structures will have greater ce ntralization? A. Functional structure B. Divisional structure C. Team structure D. Matrix structure

12 Which of the following are the users o f financial statements? A. Government B. Financial analysts C. Consumers D. All of the above



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Mock Exam


50

Questions

13 Who is primarily responsible for managing/preventing FRAUD? A. Internal auditors B. Management C. Those charged with governance D. Shareholders

14 Arrange the following needs in in the correct order starting from from the higest level need under Maslow's Maslow's needs hierarchy theory:     

Belonging Physical Security Self Actualization Self Esteem



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Questions

15 Arrange the following in correct correct order starting from top most most rank in the list at first place place       

Employee Continental director Section manager Functional manager Country director Supervisor Regional director

16 Tick the statement(s) which is (are) TRUE in relation to internal audit?

 Internal audit department is not connected with the executive functions of entity  Internal auditor usually reports to non-executive directors or those charged with governance  Internal audit department monitors the decisions taken by the management  None of the above

17 Minutes of meeting means the number of minutes for which meeting will be held  

True False

18 An organisational Information System (IS) can be a hybrid of computer based and manual based information system  

True False

19 Salaries paid to the staff of accounting department are accounted for as: A. B. C. D.

Selling cost Administrative cost Financial cost Audit fee



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Mock Exam


50

Questions

20 Which of the following help us govern the organization better? i. Code of ethics ii. Accounting standards iii. Laws regulating the operations of organization (e.g. appointment of auditor)

A. B. C. D.

I only I and III only II only I, II and III only

21 “Businesses do not have responsibilities, responsibilities, only people have responsibilities”. responsibilities”. Milton gave this argument to mean: A. B. C. D.

Mangers responsibilities towards owners Owners responsibilities towards managers Employees responsibilities towards organization Managers responsibilities towards general public

22 To control Dengue disease local government has instructed to preserve clean water in a way that mosquitos don’t have access to it as it is considered that dengue mosquito lay eggs in clean water. Quality control department of Tescon Engineering has hundreds of water tanks at different construction sights. These are quite large in numbers therefore it is decided that steps will be taken only if any government official visit the site. Which social responsibility strategy is Tescon following: A. B. C. D.

Accommodating Defensive Reactive Proactive



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Mock Exam


50

Questions

23 In recent years large number of highly skilled individuals especially doctors left Pakistan for good as they were protesting for increase in their compensations and were not willing to settle for less monthly salaries. This rendered significant majority of doctors unemployed. What type of unemployment is this? A. B. C. D.

Structural unemployment Cyclical unemployment Frictional unemployment Classical unemployment

24 Government of Banana republic wants to abolish unemployment in the country. They came up with a plan that will achieve this objective. However, this policy is facing criticism as it will cause increase in inflation. Is this criticism correct keeping other variables constant? A. Yes B. No



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Mock Exam


50

Questions

25 Ad valorem tax is a type type charge placed by government on the the price of the product which is: A. B. C. D.

Fixed amount of tax per unit Fixed percentage of amount specified by tax authorities Fixed percentage of price of product Fixed amount of percentage on individual’s income

26 “Poor are poor because they they spend more than earned whereas rich rich are rich because they spend less less than earned and thus high percentage of tax should be applied for poor and less percentage of tax rich” This will result in the retrograde approach of which type of taxation? A. Progressive B. Proportional C. Regressive

27 Sales tax is an example of: A. Progressive tax B. Proportional tax C. Regressive tax



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50

Questions

28 Applying more direct taxes taxes and encouraging citizens to save money money will help fight: A. B. C. D.

Cost push inflation Demand pull inflation Deflation Hyper deflation

29 Independent auditor’s report is addressed to: A. B. C. D.

Management General public Stakeholders Shareholders

30 Internal auditor reports to: A. B. C. D.

Customers General public Shareholders Audit committee

31 Internal auditor’s job is the ensure that: A. B. C. D.

Management has achieved value for money Internal control system is working appropriately Management is working in the best interest of shareholders All of the above

32 For entities it is mandatory to follow t he requirements of applicable accounting standards and related regulations. However, under extremely rare circumstances to prepare relevant and reliable financial statements entities are allowed to deviate from such requirements. This relaxation is called: A. B. C. D.

Regulation retrograde Legal suspension True and fair over ride Allowed alternative



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Mock Exam


50

Questions

33 Which of the following are connected stakeholders A. B. C. D.

Managers Employees Suppliers Internal auditor



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Mock Exam


50

Questions

34 While entering email address in an online form if you forgot to mention m ention “@” or address does not follow a specific syntax then error message is displayed notifying you to check the email address. This control is an example of: A. B. C. D.

Detection controls Correction controls Prevention controls Formation controls

35 Securities and Exchange Commission of the country requires every company to retain its records for a period of 5 years from the period to which they relate. This is an example of: A. B. C. D.

Data Backup Data Archiving Data storage Data restoration

36 Teeming and lading is a famous method to misappropriate: A. B. C. D.

Prepayments Inventory Cash Liabilities



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Mock Exam


50

Questions

37 Which of the following controls will help eradicate collusion with customer frauds? A. B. C. D.

Prepare control accounts Sales and dispatch departments are separate Prepare bank reconciliations Get signatures from customer on goods dispatch note

38 Management is answerable to: A. B. C. D.

Shareholders Government Courts All of the above

39 Job enlargement is an example of hygiene h ygiene factor A. True B. False



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Mock Exam


50

Questions

40 A company has recently started its its operations in a far off village. village. Labour is skilled however, however, they often get stuck executing their task and sometime take longer than usual time to finish the task. Which of the following can help them achieve better performance? A. B. C. D.

Coaching Mentoring Counseling Meeting

41 The chain communication pattern results in slow transmission of information as compared to wheel pattern A. True B. False

42 If the two parties having a communication have opposing personalities than this can result in: A. B. C. D.

Psychological noise Social noise Logical noise Peer noise

43 An assistant has prepared a presentation for board meeting to visualize performance of ongoing ongoing projects. However, he has used too many pictures tables and pictures thus it is not easy to understand the situation easily. His supervisor has asked him to improve the presentation. What area of communication is he asked to improve?

A. Medium B. Channel C. Feedback D. Encoding



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Mock Exam


50

Questions

Section B

1 Label the following diagram

2(a) Which of the following measures help reduce inflation in the economy? i. ii. iii. iv.

A. B. C. D.

Apply direct and indirect taxes Levy duties on imported products Cut down government spending Depreciate currency value

IV only II and III only I, II and III only I and III only



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Mock Exam


50

Questions

2(b) Government of Banana republic wants to abolish unemployment in the country. They came up with a plan that will achieve this objective. However, this policy is facing criticism as it will cause increase in inflation. Which of the following is a suitable measure to convince the opposition? i. Increase direct tax rates ii. Increase indirect tax rates iii. Increase savings rates

A. B. C. D.

I only I and II only I, II and III only III only

3(a) Which of the following is NOT the duty of sales manager? i. Recover debts from customers ii. Settle trade discounts iii. Ensure price is competitive

A. B. C. D.

I and II only II only I only II and III only

3(b) Which of the following is in correct order? i. Tender notice > quotations > purchase order ii. Credit note > Invoice > cash receipt iii. Purchase ledger > Purchase journal > Invoice

A. B. C. D.

I only II only II and III only III only



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Mock Exam


50

Questions

4(a) Risk of teeming and lading increase if: i. There are no credit sales ii. Person receiving cash is also responsible to record sales iii. Bank reconciliations are routinely done

A. B. C. D.

I only II only II and III only I, II and III

4(b) A company has recently introduced a scheme in which employees are paid according according to their performance. If a certain level of performance is achieved employees are promised for i ncreased incentives. However, after few months it is observed that even after the incentive scheme is announced there is no significant betterment in employees’ performance. What can be the reason? A. B. C. D.

Employees don’t find incentives to be too great to put an extra effort Performance evaluation criteria is too strict Other companies in the same industry are paying better incentives for same amount of work All of the above

5 Fill the following blanks using appropriate choices from below: _______________ learns through working _______________ learns through observing and through others’ expe experience rience _______________ learns through understanding facts, workflow, workflow, models and system _______________ learns through testing the information they already already have

A. B. C. D.

Theorist Pragmatist Activist Reflector



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Mock Exam


50

Questions

6 Fraud is a deliberate attempt to misstate financial information to gain unfair advantage or benefit. Though the risk cannot be completely eliminated however, it c an be reduced if appropriate control actions are taken. Which of the following can help reduce the fraud risk? 1. Training 2. Segregation of duties 3. Job rotation 4. Knowledge and competency

A. 1 and 2 B. 2 only C. 1, 2 and 3 o nly D. All 4 mentioned



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