Here are some essential ACCA sample questions with answers that cover various levels of ACCA:
1. (BT) What is the primary goal of a business model?
The main objective of a business model is to describe how an organisation creates, provides, and captures value through its operations.
2. (BT) Describe the Four Ps of marketing.
The "Four Ps" in marketing consist of Product, Price, Place, and Promotion.
3. (FR) How is the revenue recognised under IFRS 15?
Revenue is recognised when control of services and goods is transferred to the consumer at the transaction price.
4. (FR) What is the difference between historical cost and fair value?
Fair value is the current market price of an asset, and the historical cost is the actual purchase price.
5. (PM) Calculate the contribution margin if sales are $1,20,000 and the variable costs are $60,000.
Contribution margin = Sales - Variable costs
Contribution margin = $1,20,000- $60,000
The contribution margin price is $60,000.
6. (PM) Describe the break-even point in the form of units.
The break-even point in units refers to the quantity of goods a company must sell to cover its total fixed and variable expenses with no profit or loss incurred. It is found by dividing fixed costs by the contribution per unit, which is the difference between the selling price and the variable cost of one unit.
7. (TX) In the UK, what is the standard rate of VAT?
The VAT rate in the UK is 20%.
8. (FM) How to calculate WACC (Weighted Average Cost of Capital) in finance?
WACC = (E/V — Re) + (D/V — Rd — (1 tax rate)). Here, E is equity market value, D is debt, V is the total value of capital, Re is the cost of equity, and Rd is the cost of debt.
9. (AA) What is materiality in audit?
Materiality refers to the magnitude of an omission or misstatement that influences the economic decisions of users.
10. (AA) What are the primary opinions in auditing?
The primary types of opinions are disclaimer, adverse, qualified, and unqualified.
11. (SBL) Identify two ethical conflicts in a case scenario.
Two ethical conflicts in a case scenario are conflict of interest and breach of confidentiality.
12. (SBL) Provide three primary measures in the stakeholder analysis.
The steps include pinpointing stakeholders, assessing their importance, and developing engagement strategies.
13. (SBR) How are actuarial gains and losses treated under a defined benefit scheme?
Actuarial gains and losses, resulting from changes in actuarial assumptions or experience adjustments, are recognised in the other comprehensive income (OCI) and not recycled to profit or loss.
14. (SBR) Discuss the effects of IFRS 16 on the lessee accounting.
IFRS 16 requires lessees to identify a right-of-use asset and a lease liability on their balance sheet.
15. (AAA) Calculate the audit sampling risk where the sample deviation rate is 5%, and the tolerable rate is 3%.
The sampling risk is 2%, which is the amount by which the sample deviation rate surpasses the tolerable rate.
16. (AAA) Describe the purpose of analytical methods.
Analytical methods help all auditors to identify unusual balances or transactions that need further investigation.
17. (AFM) Explain how interest rate swaps can be used to manage interest rate risk
Interest rate swaps involve exchanging fixed interest rate payments for floating rate payments or vice versa. Companies can use swaps to align their debt structures with interest rate expectations, thereby managing exposure to interest rate fluctuations.
18 (APM) Discuss the benefits of the balanced scorecard.
It connects the performance measures to strategic objectives using four different perspectives: learning and growth, internal process, customer, and financial.
19 (ATX) What is the capital gains tax allowance for individuals in the UK (2024 to 2025)?
For the year 2024-25, the capital gains tax allowance is £3,000 for every person.
20. (ATX) Explain the primary differences between income tax and corporation tax.
Income tax applies to separate individual earnings, and the corporation tax is charged on the profits made by organisations.
