Sole traders — Paper 1 · IGCSE Accounting 0452

2 A business provided the following information on 1 February 2019. $ non-current assets 75 000 current assets 40 000 current liabilities 25 000 The business made a profit of $10 000 for the year ended 31 January 2020. The owner did not make any drawings during the year. What was the capital on 31 January 2020? A $35 000 B $50 000 C $70 000 D $100 000

1 marks

Answer: D

This question in 0452/12 Feb/March 2020

18 Which items will not be shown in an income statement prepared for a service business? 1 cost of sales 2 gross profit 3 profit for the year 4 wages paid to employees A 1 only B 1 and 2 C 2 and 4 D 3 and 4

1 marks

Answer: B

This question in 0452/11 Oct/Nov 2020

19 A trader provided the following information. $ capital at 1 October 2019 52 000 motor vehicle given to the business by the trader 3 500 personal expenses paid out of business bank account 1 500 cash drawings made during the year 500 What was the capital at 30 September 2020? A $46 500 B $50 000 C $53 500 D $55 000

1 marks

Answer: C

This question in 0452/11 Oct/Nov 2020

20 What is not a service business? A hairdressing salon B accountant’s practice C supermarket D computer repair shop

1 marks

Answer: C

This question in 0452/12 Oct/Nov 2020

18 Which items will not be shown in an income statement prepared for a service business? 1 cost of sales 2 gross profit 3 profit for the year 4 wages paid to employees A 1 only B 1 and 2 C 2 and 4 D 3 and 4

1 marks

Answer: B

This question in 0452/13 Oct/Nov 2020

17 What are the advantages of being a sole trader? easy to raise finance entitled to all profit has total control has unlimited liability

1 marks

Answer: D

This question in 0452/11 May/June 2021

18 Which items would appear in the income statement of a service business? gross profit fhe ear surplus A J J x B J x Jv Cc x Jv x D x x Jv

1 marks

Answer: C

This question in 0452/11 May/June 2021

22 James is an accountant and operates as a sole trader. Which items would not appear in his statement of financial position? 1 long-term loan 2 retained earnings 3 trade payables A 1 and 2 B 1 and 3 C 2 only D 2 and 3

1 marks

Answer: D

This question in 0452/12 May/June 2021

23 Zaha is a consultant who receives fees from clients. How would Zaha calculate his profit for the year? A fees received – cost of sales B fees received – cost of sales + expenses C fees received + expenses D fees received – expenses

1 marks

Answer: D

This question in 0452/12 May/June 2021

22 James is an accountant and operates as a sole trader. Which items would not appear in his statement of financial position? 1 long-term loan 2 retained earnings 3 trade payables A 1 and 2 B 1 and 3 C 2 only D 2 and 3

1 marks

Answer: D

This question in 0452/13 May/June 2021

23 Zaha is a consultant who receives fees from clients. How would Zaha calculate his profit for the year? A fees received – cost of sales B fees received – cost of sales + expenses C fees received + expenses D fees received – expenses

1 marks

Answer: D

This question in 0452/13 May/June 2021

18 What are advantages of operating as a sole trader? 1 The owner can keep all the profit. 2 The owner can raise finance by issuing debentures. 3 The owner can make decisions independently. 4 The owner is protected by limited liability. A 1 and 3 B 1 only C 2 and 3 D 2 and 4

1 marks

Answer: A

This question in 0452/11 Oct/Nov 2021

17 Which is an advantage and a disadvantage of operating as a sole trader? advantage disadvantage A gains all the profit bears all the risk B gains all the profit controls the decision-making C provides all the capital bears all the risk D provides all the capital controls the decision-making

1 marks

Answer: A

This question in 0452/12 Oct/Nov 2021

18 What are advantages of operating as a sole trader? 1 The owner can keep all the profit. 2 The owner can raise finance by issuing debentures. 3 The owner can make decisions independently. 4 The owner is protected by limited liability. A 1 and 3 B 1 only C 2 and 3 D 2 and 4

1 marks

Answer: A

This question in 0452/13 Oct/Nov 2021

21 Which businesses do not prepare a trading account section of an income statement? 1 furniture store 2 insurance company 3 newsagent 4 toy shop 5 window-cleaner A 1 and 2 B 2 and 5 C 3 and 4 D 3 and 5

1 marks

Answer: B

This question in 0452/12 Feb/March 2022

2 On 1 June 2021, Sue’s capital account had a credit balance of $120 000. During the year ended 31 May 2022 she withdrew goods costing $1800. The loss for the year was $14 200. What was the credit balance on Sue’s capital account on 1 June 2022? A $104 000 B $105 800 C $107 600 D $134 200

1 marks

Answer: A

This question in 0452/12 Oct/Nov 2022

21 The owner of a restaurant is concerned about high operating costs. Which statement will show the operating costs for the year? A bank statement B bank reconciliation statement C income statement D statement of financial position

1 marks

Answer: C

This question in 0452/12 Feb/March 2023

30 Hassan’s capital decreased by $200 over the year, even though he made a profit of $7000. Which transactions caused this? capital introduced drawings $ $ A 1000 8200 B 1200 6000 C 2000 8800 D 2200 4600

1 marks

Answer: A

This question in 0452/11 May/June 2023

20 Which group contains only service businesses? A book shop, language school, newsagent B jewellery repairer, taxi firm, food store C language school, taxi firm, jewellery repairer D taxi firm, newsagent, food store

1 marks

Answer: C

This question in 0452/12 May/June 2023

21 What is an advantage of operating as a sole trader? A being entitled to all profits B being responsible for all losses C having limited liability D having unlimited liability

1 marks

Answer: A

This question in 0452/11 Oct/Nov 2023

22 Emma provided the following information at the end of her financial year. $ fees receivable from clients 78 000 rent receivable 11 000 office expenses 20 000 motor expenses 9 000 drawings 2 000 What was her profit for the year? A $47 000 B $49 000 C $58 000 D $60 000

1 marks

Answer: D

This question in 0452/11 Oct/Nov 2023

21 What is an advantage of operating as a sole trader? A being entitled to all profits B being responsible for all losses C having limited liability D having unlimited liability

1 marks

Answer: A

This question in 0452/13 Oct/Nov 2023

22 Emma provided the following information at the end of her financial year. $ fees receivable from clients 78 000 rent receivable 11 000 office expenses 20 000 motor expenses 9 000 drawings 2 000 What was her profit for the year? A $47 000 B $49 000 C $58 000 D $60 000

1 marks

Answer: D

This question in 0452/13 Oct/Nov 2023

23 A trader provided the following data. $ total purchases 25 301 purchase returns 1 945 carriage inwards 748 goods taken for own use 1 425 What was the net figure for purchases in the income statement? A $21 931 B $22 679 C $23 356 D $24 104

1 marks

Answer: B

This question in 0452/13 Oct/Nov 2023

20 What is not a service business? A a computer repair shop B a furniture factory C a hairdressing salon D a travel agent

1 marks

Answer: B

This question in 0452/12 Feb/March 2024

22 Which statement about a statement of financial position is correct? A It is part of the double entry system. B It proves the arithmetical accuracy of the accounts. C It shows income and expenses for a certain period of time. D It shows the assets and liabilities on a certain date.

1 marks

Answer: D

This question in 0452/12 Feb/March 2024

21 A trader was preparing her statement of financial position at 30 June 2021. She had four bank loans. loan date repayable $ 1 1 December 2021 5000 2 1 December 2022 10000 3 1 September 2023 8000 4 1 December 2025 6000 What was the total amount of loans that should be recorded as non-current liabilities at 30 June 2021? A $14000 B $15000 C $23000 D $24000

1 marks

Answer: D

This question in 0452/11 May/June 2024

20 'Unlimited liability’ is one of the disadvantages of operating as a sole trader. What is the correct explanation of unlimited liability? A A sole trader cannot take a bank loan. B A sole trader has to manage their business alone. C A sole trader cannot use their private funds to repay business loans. D A sole trader may lose both their business and personal funds.

1 marks

Answer: D

This question in 0452/12 May/June 2024

20 'Unlimited liability’ is one of the disadvantages of operating as a sole trader. What is the correct explanation of unlimited liability? A A sole trader cannot take a bank loan. B A sole trader has to manage their business alone. C A sole trader cannot use their private funds to repay business loans. D A sole trader may lose both their business and personal funds.

1 marks

Answer: D

This question in 0452/13 May/June 2024

21 What is a disadvantage of operating as a sole trader? A Access to capital is restricted. B Book-keeping records are more complex. C Decisions may take longer to implement. D The liability of the owner is limited.

1 marks

Answer: A

This question in 0452/11 Oct/Nov 2024

20 Which items would appear in the income statement for an accountancy business? gross profit profit for the year surplus A ✓ ✓ ✗ B ✓ ✗ ✓ C ✗ ✓ ✗ D ✗ ✗ ✓

1 marks

Answer: C

This question in 0452/12 Oct/Nov 2024

21 What is a disadvantage of operating as a sole trader? A Access to capital is restricted. B Book-keeping records are more complex. C Decisions may take longer to implement. D The liability of the owner is limited.

1 marks

Answer: A

This question in 0452/13 Oct/Nov 2024

21 What is a disadvantage of running a business as a sole trader? A The owner does not have to pay interest on drawings. B The owner is entitled to all the profits made by the business. C The owner must share the decision-making and the profits. D The owner’s personal possessions are at risk if the business should fail.

1 marks

Answer: D

This question in 0452/12 Feb/March 2025

19 Which items are shown in a statement of financial position? current non-current revenue capital assets liabilities A ✓ ✓ ✓ ✗ B ✗ ✗ ✓ ✓ C ✗ ✓ ✗ ✓ D ✓ ✗ ✓ ✓

1 marks

Answer: D

This question in 0452/11 May/June 2025

25 A club included the balance on its accumulated fund in its statement of financial position. What is the equivalent of the accumulated fund in a statement of financial position of a sole trader? A capital B capital and liabilities C current liabilities D non-current assets

1 marks

Answer: A

This question in 0452/11 May/June 2025

5 At the end of her financial year, Jasmine balanced her cash book and ledger accounts and made appropriate year-end transfers. Which statements are correct? 1 The debit balance on the account of a credit customer will be shown as an asset in the statement of financial position. 2 The debit balance on the bank column in the cash book will be shown as a liability in the statement of financial position. 3 The total of the discount received account will be included in the cost of sales in the income statement. 4 The total of the general expenses account will be deducted from gross profit in the income statement. A 1, 2 and 3 B 1, 3 and 4 C 1 and 4 only D 2 and 3 only

1 marks

Answer: C

This question in 0452/13 May/June 2025

19 Which items are shown in a statement of financial position? current non-current revenue capital assets liabilities A ✓ ✓ ✓ ✗ B ✗ ✗ ✓ ✓ C ✗ ✓ ✗ ✓ D ✓ ✗ ✓ ✓

1 marks

Answer: D

This question in 0452/13 May/June 2025

25 A club included the balance on its accumulated fund in its statement of financial position. What is the equivalent of the accumulated fund in a statement of financial position of a sole trader? A capital B capital and liabilities C current liabilities D non-current assets

1 marks

Answer: A

This question in 0452/13 May/June 2025

20 Who works in a service business? 1 a hairdresser 2 an estate agent 3 a car mechanic 4 a car salesperson A 1, 2 and 3 B 1 and 2 only C 2, 3 and 4 D 3 and 4 only

1 marks

Answer: A

This question in 0452/12 Oct/Nov 2025

21 Tim wanted to set up a new business. Why did he prefer to set up as a sole trader rather than as a limited company? 1 to be able to make drawings when he wanted 2 to have easier access to bank loans 3 to safeguard his personal assets from suppliers A 1 and 2 B 1 only C 2 and 3 D 3 only

1 marks

Answer: B

This question in 0452/13 Oct/Nov 2025

22 Why is it important for a sole trader to prepare a statement of financial position for the business? A to know the net worth of the business at a certain date B to list all revenues and expenses of the business C to measure the profitability of business sales D to record all cash receipts and payments

1 marks

Answer: A

This question in 0452/13 Oct/Nov 2025