Sole traders — Paper 1 · IGCSE Accounting (9-1) 0985

19 Which items are deducted from the gross profit when calculating the profit for the year? 1 balance on the provision for doubtful debts account 2 carriage paid on goods supplied to customers 3 drawings made by the owner during the year 4 wages paid to employees during the year A 1, 2 and 3 B 1 and 4 C 2 and 3 only D 2 and 4

1 marks

Answer: D

This question in 0985/11 May/June 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 0985/11 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 0985/11 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 0985/12 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 0985/12 May/June 2021

29 Nula provided the following information for the year ended 31 March 2021. $ drawings for the year 3 900 net assets at 1 April 2020 60 500 net assets at 31 March 2021 72 275 What was the profit or loss for the year ended 31 March 2021? A $7875 loss B $7875 profit C $15 675 loss D $15 675 profit

1 marks

Answer: D

This question in 0985/12 May/June 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 0985/12 Oct/Nov 2021

29 Which information is required to calculate the return on capital employed for a sole trader? A gross profit, non-current liabilities, owner’s capital B gross profit, non-current liabilities, working capital C operating profit for the year, non-current liabilities, owner’s capital D operating profit for the year, non-current liabilities, working capital

1 marks

Answer: C

This question in 0985/12 Oct/Nov 2021

20 Which statements are correct? 1 A debenture holder of a limited company is liable for the debts of the company. 2 A partner is liable to pay business debts from personal assets. 3 A shareholder of a limited company is responsible for the company’s debts. 4 A sole trader is responsible for all the debts of his business. A 1 and 2 B 1 and 3 C 2 and 4 D 3 and 4

1 marks

Answer: C

This question in 0985/12 May/June 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 0985/12 Oct/Nov 2022

18 How would current assets be listed if they are arranged in decreasing order of liquidity? A bank, cash, trade receivables, inventory B cash, bank, trade receivables, inventory C inventory, trade receivables, bank, cash D inventory, trade receivables, cash, bank

1 marks

Answer: B

This question in 0985/12 Oct/Nov 2022

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 0985/11 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 0985/12 May/June 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 0985/12 Oct/Nov 2024

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 0985/11 May/June 2025

27 A trader’s assets increased by $25 000 and liabilities decreased by $5000 during the year. He took no drawings during the year. What was the profit or loss for the year? A $20000 loss B $20000 profit C $30000 loss D $30000 profit

1 marks

Answer: D

This question in 0985/11 May/June 2025

30 Gustav began a business on 1 January 2023 with $50000 capital. He provided the following information for the year ended 31 December 2024. $ capital opening balance 58000 additional capital introduced 2000 drawings for the year 9880 capital closing balance 60156 How much profit did Gustav make in 2024? A $4156 B $8000 C $10036 D $18036

1 marks

Answer: C

This question in 0985/12 May/June 2025