RICS APC - Accounting Principles and
Procedures Level 1 Questions and
Verified Solutions 100% Correct Already
Graded A+
What is accounting? - Answer: Method of collecting, analysing and communicating financial information.
The purpose is to accumulate financial information about the performance and financial position of a
business.
What is VAT? - Answer: Value Added Tax
This is a consumption tax on goods and services that is levied at each stage of the supply chain where
value is added, from initial production to the point of sale.
In the UK the VAT rate is 20%.
What is corporation tax? - Answer: Corporate tax is a tax on the profits of a corporation. The taxes ate
paid on a company's taxable income, which includes revenue minus cost of goods sol (COGS), general
and administrative (G&S) expenses, selling and marketing, research and development, depreciation and
other operating costs.
Since 1st April 2023, the rate for corporate tax is:
Small Profits Rate (companies with profits under £50k) - 19%
Main Rate (companies with profits over £250k) - 25%
Companies with profits between £50k and £250k will pay the main rate, reduced by a marginal relief.
What is an audit? - Answer: - Process used to check a person or companies' compliance with policy,
procedures and compliance with regulation.
, - Audits are performed to ascertain the validity and reliability of information; also to provide an
assessment of a system's internal control.
What is an auditor? - Answer: An auditor ensures validity of companies accounts. Confirm that they are
genuine and following the correct principles.
What is turnover? - Answer: - Income or revenue that a company receives from its normal business
activities.
- Usually from sale of goods and services to customers
What are management accounts? - Answer: Accounts prepared by a company for internal management
use, or accounts prepared for a lender, such as a bank to evaluate how the business will repay funding.
Management accounts will not be audited externally.
Most people use their management accounts to see how their business has been performing in many
different areas. That then helps them make timely decisions based on accurate information.
What is the difference between management and financial accounts? - Answer: - Financial accounting is
meant for external stakeholders.
- Management accounting is presented internally
What are financial accounts made up of? - Answer: Financial accounts are made up of three elements:
- Profit and loss statement
- Balance sheet
- Cash flow analysis
What sort of data do management accounts show? - Answer: - Sales: The performance over the last
month or quarter, product pricing and credit control
- Purchasing: How much your business has spent in the last period, how much stock it holds, and what
you owe
- Fixed assets: What your business owns
Procedures Level 1 Questions and
Verified Solutions 100% Correct Already
Graded A+
What is accounting? - Answer: Method of collecting, analysing and communicating financial information.
The purpose is to accumulate financial information about the performance and financial position of a
business.
What is VAT? - Answer: Value Added Tax
This is a consumption tax on goods and services that is levied at each stage of the supply chain where
value is added, from initial production to the point of sale.
In the UK the VAT rate is 20%.
What is corporation tax? - Answer: Corporate tax is a tax on the profits of a corporation. The taxes ate
paid on a company's taxable income, which includes revenue minus cost of goods sol (COGS), general
and administrative (G&S) expenses, selling and marketing, research and development, depreciation and
other operating costs.
Since 1st April 2023, the rate for corporate tax is:
Small Profits Rate (companies with profits under £50k) - 19%
Main Rate (companies with profits over £250k) - 25%
Companies with profits between £50k and £250k will pay the main rate, reduced by a marginal relief.
What is an audit? - Answer: - Process used to check a person or companies' compliance with policy,
procedures and compliance with regulation.
, - Audits are performed to ascertain the validity and reliability of information; also to provide an
assessment of a system's internal control.
What is an auditor? - Answer: An auditor ensures validity of companies accounts. Confirm that they are
genuine and following the correct principles.
What is turnover? - Answer: - Income or revenue that a company receives from its normal business
activities.
- Usually from sale of goods and services to customers
What are management accounts? - Answer: Accounts prepared by a company for internal management
use, or accounts prepared for a lender, such as a bank to evaluate how the business will repay funding.
Management accounts will not be audited externally.
Most people use their management accounts to see how their business has been performing in many
different areas. That then helps them make timely decisions based on accurate information.
What is the difference between management and financial accounts? - Answer: - Financial accounting is
meant for external stakeholders.
- Management accounting is presented internally
What are financial accounts made up of? - Answer: Financial accounts are made up of three elements:
- Profit and loss statement
- Balance sheet
- Cash flow analysis
What sort of data do management accounts show? - Answer: - Sales: The performance over the last
month or quarter, product pricing and credit control
- Purchasing: How much your business has spent in the last period, how much stock it holds, and what
you owe
- Fixed assets: What your business owns
