1 Expenses classified by function would be categorised as: O marketing expenses. O borrowing expenses. O selling and distribution expenses. O all of the options listed.

2 Which of the following would not be classified as an administrative expense? O Salaries and wages of sales staff. O Stationery. O Depreciation of office equipment. O Rates.

3 Preparing financial statements on the basis of recognising transactions when they occur is referred to as: O accrual accounting. O management accounting. O cash accounting. O financial accounting

4 For a business selling magazine subscriptions and preparing financial reports on a monthly basis, when should it recognise the revenue from the sale of annual subscriptions? O When a customer pays the annual subscription. O Monthly, on a straight-line basis over the 12 month subscription period. O Evenly, from the month of payment up to the end of the current financial year. O When the annual subscription period expires.

5 Which of the following are included in a statement of changes in equity? O All changes in equity arising from equity contributions and dividends paid. O All changes in equity arising from shares purchased. O All changes in equity arising separately from non-owner changes in equity (e.g. profit). O All options are included in a statement of changes in equity.

6 Equity is decreased by: O liabilities. O expenses. O income. O assets.