SAPP DELOITTE ENTRANCE TEST ANSWER

I SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn SAPP Academy DELOITTE ENTRANCE TEST ANSWER No 20, 198 alley, Xa Dan street, Ha Noi Tel: 0166 7703 493 Sapp.edu.vn ACCOUNTING (20 questions) The following information is available for a sole trader who keeps no accounting records: Net business assets at July 20X6 186,000 Net business assets at 30 June 20X7 274,000 During the year ended 30 June 20X6: Cash drawings by proprietor 68,000 Additional capital introduced by proprietor 50,000 Business cash used to buy a car for the 20,000 proprietor's wife, who takes no part in the business Using this information, what is the trader's profit for the year ended 30 June 20X6? A $126,000 B $50,000 C $86,000 D $90,00 Answer: Profit = Increase in net asset - capital introduce + drawings = 88 – 50 + 88 = 126 Which of the following statements apply when producing a consolidated statement of financial position? (i) All intra-group balances should be eliminated (ii) Intra-group profit in year-end inventory should be eliminated (iii) Closing inventory held by subsidiaries needs to be included at fair value A i only B i, ii and iii C i and ii only D iii only Which of the following items could appear in a company’s statement of cash flows? (i) Surplus on revaluation of non-current assets (ii) Repayment of long-term borrowing (iii) Bonus issue of shares (iv) Interest received A i and ii B iii and iv C i and iii D ii and iv Page of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn Which of the following statements are correct? SAPP Academy Tel: 0166 7703 493 No 20, 198 alley, Xa Dan street, Ha Noi Sapp.edu.vn (i) A liability is a present obligation, arising from past events, the settlement of which is expected to result in an outflow of economic resources (ii) An uncertain liability may be called a provision (iii) A contingent liability should be disclosed in the notes to the financial statements A i only B i and ii only C ii and iii only D i, ii and iii A company sublets part of its office accommodation In the year ended 30 June 20X5 cash received from tenants was $83,700 Details of rent in arrears and in advance at the beginning and end of the year were: In arrears In arrears $ $ 30 June 20X6 3,800 2,400 30 June 20X7 4,700 3,000 All arrears of rent were subsequently received What figure for rental income should be included in the company's statement of profit or loss for the year ended 30 June 20X5? A $84,000 B $83,400 C $80,600 D $85,800 Rental income = 2,400 + 83,700 + 4,700 – 3,800 – 3,000 = $84,000 Which of the following are correct? (i) The statement of financial position value of inventory should be as close as possible to net realisable value (ii) The valuation of finished goods inventory must include production overheads (iii) Production overheads included in valuing inventory should be calculated by reference to the company's normal level of production during the period (iv) In assessing net realisable value, inventory items must be considered separately, or in groups of similar items, not by taking the inventory value as a whole A i and ii only B iii and iv only C i and iii only D ii, iii and iv Page of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn The figures shown inAcademy the table below are an extract from the accounts of Ridgeway SAPP Tel: 0166 7703 493 No 20, 198 alley, Xa Dan street, Ha Noi Sapp.edu.vn (capital employed is $1.5m) $ Revenue 1,000,000 Cost of sales 400,000 Gross profit 600,000 Distribution expenses and administration cost 300,000 Profit before interest and tax 300,000 Finance cost 50,000 Profit before tax 250,000 Income tax expense 100,000 Profit after tax 150,000 What is the return on capital employed (ROCE)? A 7% B 10% C 40% D 20% Answer: ROCE = $300,000/$1.5m = 20% Ordan received a statement from one of its suppliers, Alta, showing a balance due of $3,980 The amount due according to the payables ledger account of Alta in Ordan's records was only $230 Comparison of the statement and the ledger account revealed the following differences:  A cheque sent by Ordan for $270 has not been allowed for in Alta's statement  Alta has not allowed for goods returned by Ordan $180  Ordan made a contra entry, reducing the amount due to Alta by $3,200, for a balance due from Alta in Ordan's receivables ledger No such entry has been made in Alta's records What difference remains between the two companies' records after adjusting for these items? A $460 B $640 C $6,500 D $100 Page of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn Which of the following statements are correct? SAPP Academy Tel: 0166 7703 493 No 20, 198 alley, Xa Dan street, Ha Noi Sapp.edu.vn (i) Contingent assets are included as assets in financial statements if it is probable that they will arise (ii) Contingent liabilities must be provided for in financial statements if it is probable that they will arise (iii) Material non-adjusting events are disclosed by note in the financial statements A i only B i and iii C ii and iii D iii only 10 At January 20X5 a company had an allowance for receivables of $18,000 At 31 December 20X5 the company's trade receivables were $458,000 It was decided:  To write off debts totalling $28,000 as irrecoverable  To adjust the allowance for receivables to the equivalent of 5% of the remaining receivables What figure should appear in the company's statement of profit or loss for the total of debts written off as irrecoverable and the movement in the allowance for receivables for the year ended 31 December 20X5? A $49,500 B $31,500 C $32,900 D $50,900 11 The following information is available about the transactions of Razil, a sole trader who does not keep proper accounting records: $ Opening inventory 77,000 Closing inventory 84,000 Purchases 763,000 Gross profit as a percentage of sales 30% Based on this information, what is Razil's sales revenue for the year? A $982,800 B $1,090,000 C $2,520,000 D $1,080,000 Page of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn 12 Tinsel Co has million $1 issued ordinary shares At May 20X0 Fairy CoTel: purchased 60% SAPP Academy 0166 7703 493 No 20, 198 alley, Xa Dan street, Ha Noi Sapp.edu.vn of Tinsel Co’s $1 ordinary shares for $4,000,000 At that date Tinsel Co had net assets with a fair value of $4,750,000 and a share price of $1.10 Fairy Co valued the noncontrolling interest in Tinsel Co at acquisition as $2,200,000 What is the total goodwill on acquisition at May 20X0? A $1,150,000 B $1,750,000 C $750,000 D $1,450,000 13 On September 20X6, a business had inventory of $380,000 During the month, sales totaled $650,000 and purchases $480,000 On 30 September 20X6 a fire destroyed some of the inventory The undamaged goods in inventory were valued at $220,000 The business operates with a standard gross profit margin of 30% Based on this information, what is the cost of the inventory destroyed in the fire? A $185,000 B $140,000 C $405,000 D $360,000 14 A business received a delivery of goods on 29 June 20X6, which was included in inventory at 30 June 20X6 The invoice for the goods was recorded in July 20X6 (i) Profit for the year ended 30 June 20X6 will be overstated (ii) Inventory at 30 June 20X6 will be understated (iii) Profit for the year ending 30 June 20X7 will be overstated (iv) Inventory at 30 June 20X6 will be overstated What effect will this have on the business? A i and ii B ii and iii C i only D i and iv Page of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn 15 Which of the following statements about the requirements of VASTel:18 SAPP Academy 0166Provisions, 7703 493 No 20, 198 alley, Xa Dan street, Ha Noi Sapp.edu.vn Contingent Liabilities and Contingent Assets are correct? (i) Contingent assets and liabilities should not be recognised in the financial statements (ii) A contingent asset should only be disclosed in the notes to a financial statement where an inflow of economic benefits is probable (iii) A contingent liability may be ignored if the possibility of the transfer of economic benefits is remote A All three statements are correct B i and ii only C i and iii only D ii and iii only 16 Carter, a limited liability company, has non-current assets with a carrying value of $2,500,000 on December 20X7 During the year ended 30 November 20X8, the following occurred:  Depreciation of $75,000 was charged to the statement of profit or loss  Land and buildings with a carrying value of $1,200,000 were revalued to $1,700,000  An asset with a carrying value of $120,000 was disposed of for $150,000  The carrying value of non-current assets at 30 November 20X8 was $4,200,000 In accordance with VAS 24 Statement of Cash Flows, what net cash flows from the above transactions would be included within ‘net cash flows from investing activities’ for the year ended 30 November 20X8? A $(1,395,000) B $(1,365,000) C $150,000 D $(1,245,000) Page of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn 17 A newly registered company adopt SAPP Academy is considering the accounting policies it should Tel: 0166 7703 493 No 20, 198 alley, Xa Dan street, Ha Noi Sapp.edu.vn Policies under consideration are: (i) Research and development expenditure should be capitalised and amortised over the years in which the resultant product is sold or used (ii) Inventory should be valued at the lower of cost and net realisable value (iii) Goodwill arising in a business combination should be written off immediately to the statement of profit or loss Which of these possible accounting policies would, if adopted, contravene International Financial Reporting Standards? A i and ii only B ii and iii only C i and iii only D i, ii and iii 18 Which of the following costs should be included in valuing inventories of finished goods held by a manufacturing company, according to VAS Inventories? (i) Carriage inwards (ii) Carriage outwards (iii) Depreciation of factory plant (iv) Accounts department costs relating to wages for production employees A All four items B ii and iii only C i, iii and iv only D i and iv only 19 The increase in net assets is $173, drawings are $77 and capital introduced is $45 What is the net profit for the year? A $295 B $205 C $51 D $141 20 Capital introduced is $50 Profits brought forward at the beginning of the year amount to $100 and liabilities are $70 Assets are $90 What is the retained profit for the year? A $130 profit B $130 loss C $10 profit D $10 loss Page of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn II AUDITING (15 questions) SAPP Academy Tel: 0166 7703 493 No 20, 198 alley, Xa Dan street, Ha Noi Sapp.edu.vn 21 Which one of the following procedures should NOT be carried out after the audit firm has decided to accept appointment as auditor? A Ensure that the outgoing auditors’ removal/ resignation has been properly conducted B Ensure that a resolution has been passed at the general meeting to appoint the new auditors C Perform checks to ensure that there are no legal or ethical reasons why the new audit firm cannot act as auditor D Submit a letter of engagement to the directors 22 Which one of the following NOT constitute analytical procedures? A Consideration of comparable information for period periods B Consideration of relationships between elements of financial information that are expected to conform to a predicted pattern C Consideration of whether a balance has been calculated correctly D Consideration of similar industry information 23 What is the primary difference between fraud and errors in financial statement reporting? A The materiality of the misstatement B The intent to deceive C The level of management involved D The type of transaction effected 24 Which two of the following characteristics apply to internal audit? (i) The purpose is to improve the company’s operations (ii) Reports to shareholders on whether the financial statements give a true and fair view of affairs (iii) Auditors may be employees of the company (iv) Evidence is collected in accordance with relevant regulations A i and iii B ii and iv C i and iv D ii and iii Page of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn SAPP Academy No 20, 198 alley, Xa Dan street, Ha Noi Tel: 0166 7703 493 Sapp.edu.vn 25 What are the two elements of the risk of material misstatement at the assertion level? A Inherent risk and detection risk B Audit risk and detection risk C Inherent risk and control risk D Detection risk and control risk 26 The auditor of Z Co has set performance materiality at $100,000 Which of the following could be the materiality level set for the financial statements as a whole for Z Co? A $80,000 B $95,000 C $100,000 D $120,000 27 Due to disruptions caused by the recent transition to a new accounting system, one month of H Co's inventory records have been lost The auditors performing the statutory audit for the twelve month period have determined that the possible effects of undetected misstatements could be material, but not pervasive What form of audit opinion would the auditor give? A Unmodified opinion with an emphasis of matter paragraph B Qualified opinion C Adverse opinion D Disclaimer of opinion 28 The auditor of A Co wishes to reduce audit risk Which of the following actions could the auditor take to achieve this? (i) Increase sample sizes (ii) Reduce control risk (iii) Assign more experienced staff to the engagement team A i only B ii only C i and iii D ii and iii Page of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn 29 The auditor of Mondays Ltd is performing a test to ensure that there are no omissions SAPP Academy Tel: 0166 7703 493 No 20, 198 alley, Xa Dan street, Ha Noi Sapp.edu.vn from the non-current asset register In respect of which of the following assertions will this procedure provide audit evidence? A Cut-off B Valuation C Completeness D Existence E Classification 30 Which of the following financial statement assertions will be supported by a sample check on the numberical sequence of despatch notes and invoices? A Allocation B Occurrence C Completeness D Valuation 31 What is the objective of external audit of a limited company? A To protect the interests of minority shareholders B To detect fraud and other irregularities C To assess the effectiveness of the company’s performance D To provide assurance on the directors’ assertion about the financial statements 32 Who would approve the appointment of a company’s auditor? A The statutory authorities B The directors C The shareholders D The company’s bank Page 10 of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn SAPP Academy No 20, 198 alley, Xa Dan street, Ha Noi Tel: 0166 7703 493 Sapp.edu.vn 33 As an audit team member with two years of experience, you were assigned to carry out a substantive test on directors’ expenses The result of the test showed that in several cases involving the same director, the Chief Financial Officer (CFO) had authorised the over payment of his expenses Each expense item was less than the performance materiality level What action should be taken? A Draw conclusion B Discuss with a senior member of the audit team C Extend sample D Discuss with the CFO 34 Talland &Co is the external auditor of Huntley Co, a retailer The managing partner has been called to a meeting with the board of directors of Huntley Co At that meeting the firm has been asked if it can provide the following non-audit services Huntley Co plans to implement a new sales system The board proposes that Talland & Co takes on a consultancy project to evaluate several possible systems, advise on which system should be selected, and oversee the installation of the new system Which of the following threats would arise from the above scenario, if the project was accepted by Talland & Co? A Advocacy B Familiality C Self-review D Intimidation 35 Which of the following statement are true with respect to use of analytical procedures in audits? (1) They are used at the planning stage (2) They involve tracing transactions from documentation to accounting records (3) They are used to provide substantive evidence (4) They are used to provide evidence of the operation of control A B C D (2), (3), (4) only (2) and (4) (1) and (3) (1), (2), and (3) only Page 11 of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi III TAX (15 questions) SAPP Academy No 20, 198 alley, Xa Dan street, Ha Noi 36 Current standard CIT rate is: A 27% (applicable from January 2014) B 22% (applicable from January 2015) C 20% (applicable from January 2016) D 23% (applicable from Jannuary 2014) Tel 096 972 94 63 Sapp.edu.vn Tel: 0166 7703 493 Sapp.edu.vn 37 FCT rate for transfer of securities A 5% CIT, 3% VAT B 2% CIT C 0.1% CIT D 1% CIT 38 Which is (are) the requirement(s) for PE conditions? A A production or business estalishment through which a foreign company carries out part or the whole of business activities in Vietnam and earn income B A production or business estalishment through which a foreign company carries out part of business activities in Vietnam and earn income C A production or business estalishment through which a foreign company carries out the whole of business activities in Vietnam and earn income D A production or business estalishment through which a foreign company carries out part or the whole of business activities in Vietnam and have profit 39 Tax rate applied to non-tax residents A Progressive tax rates based on income levels B 10% tax rate C 20% tax rate for employment income D 2% of the sales proceeds 40 Company A is liable to pay value-added tax by the credit method The added-value invoice contains the following items: Selling price: VND 100,000 VAT (10%): VND 10,000 Payment price: VND 110,000 What is the turnover for calculating taxable income? A VND 110,000 B VND 100,000 C VND 111,111 D VND 90,000 Page 12 of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn 41 Company A, which is Academy a business organization that pays tax using credit-invoice method, SAPP Tel: 0166 7703 493 No 20, 198 alley, Xa Dan street, Ha Noi Sapp.edu.vn buys coffee beans from farmers, then sells them to business household H VAT shall be levied on: A 5% the profit from selling coffee beans to business household H B 5% the revenue from selling coffee beans to business household H C 10% the revenue from selling coffee beans to business household H D 10% the profit from selling coffee beans to business household H 42 Mrs C earns an income of 40 million VND from wages and remuneration in the month, and pay 7% of wages for social insurance premium, 1.5% of wages for health insurance premium Mrs C has children under the age of 18, and makes no charitable donations The assessable income of Mrs.C A 29.4 million VND B 20.4 million VND C 24 million VND D 23.8 million VND 43 Non-business unit A leases a house and earns an annual turnover of VND 100 million It cannot determine the cost of and income from this activity, so it chooses to declare and pay enterprise income tax at a percentage of the turnover from the sale of goods and services as follows A million VND B million VND C million VND D 25.15 million VND 44 When would they determine of VAT/CIT for goods A Transfer of ownership B Money collection C Invoice issuance D Others 45 Mr D directly signs a contract with lottery company X to act as a level I agent of company X In 2015, Mr D receives a total commission of VND 240 million (> VND 100 million) In this case, what is the revenue to calculate tax from lottery agent activities? A 100 million VND B 240 million VND C 140 million VND D None of above Page 13 of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi IV GENERAL (10 questions) SAPP Academy No 20, 198 alley, Xa Dan street, Ha Noi 46 The first female Chairman of National Assembly of Vietnam is A Nguyen Thi Kim Ngan B Tong Thi Phong C Truong My Hoa D Nguyen Thi Doan 47 Seagame 29 will be hosted in? A Vietnam B Cambodia C Brunei D Malaysia 48 Where is the origin of the Zika virus? A Brazin B Uganda C Brunei D Mexico 49 How many deputy prime ministers are there in Vietnam? A B C D 50 How many times did Vietnam participate in FIFA U-20 WorldCup? A B C D 51 Who is the minister of Industry and Trade in Vietnam? A Truong Minh Tuan B Vu Huy Hoang C Dinh Tien Dung D Tran Tuan Anh Page 14 of 17 Tel 096 972 94 63 Sapp.edu.vn Tel: 0166 7703 493 Sapp.edu.vn SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi 52 When did the Uber enter to the Vietnamese market? SAPP Academy No 20, 198 alley, Xa Dan street, Ha Noi A 5/2014 B 6/2014 C 7/2014 D 8/2014 53 Which of the following Vietnamese films broke the box office record? A Vu em tap su B Em chua 18 C Ve si Sai Gon D Bui doi cho lon 54 Who is the winner at The VoiceVietnam 2017: A Dao Tin B Ali Hoang Duong C Mai Anh D Milana 55 TPP signed at A Rusia B Japan C New Zealand D Canada Page 15 of 17 Tel 096 972 94 63 Sapp.edu.vn Tel: 0166 7703 493 Sapp.edu.vn SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi V IQ, EQ (5 questions) SAPP Academy No 20, 198 alley, Xa Dan street, Ha Noi 56 The numbers in the grid to together in a certain way Which number should be in the square marked by the question mark? 35 30 27 A B C D 31 26 23 28 23 ? Tel 096 972 94 63 Sapp.edu.vn Tel: 0166 7703 493 Sapp.edu.vn 19 20 21 22 57 27, 24, 30, 27, 33, … A 48 B 27 C 30 D 24 58 The present age of Ram is 20 years and of his father is 40 years How many years ago the age of his father was three times of his age? A 10 years B years C years D years 59 Which is the difference againts others? J, E, O, A A J B E C O D A 60 Three friends had dinner at a restaurant When the bill was received, Amita paid 2/3 as much as Veena paid, and Veena paid 1/3 as much as Tanya paid What fraction of the bill did Veena pay? A 1/3 B 3/11 C 3/14 D 5/8 Page 16 of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp.edu.vn VI ESSAY SAPP Academy Tel: 0166 7703 493 No 20, 198 alley, Xa Dan street, Ha Noi Sapp.edu.vn More and more people decide to have children later in their life nowadays By an essay of at least 250 words, discuss the reasons and effects on society and family life? Suggested solution: In recent years, the decision of parents to start a family later in life has become an increasingly popular trend There are a number of reasons for this trend, which is having a significant impact on both family life and on the community as a whole There are two important reasons why more people nowadays are deciding against having children when they are young Firstly, rather than embarking on parenthood, many individuals consider that building their own successful careers is top-priority If they had to split their time between working and bringing up their offspring when they were in the early stages of their careers, their performance at work and promotion prospects could be negatively affected Secondly, delaying childbirth could give young people countless opportunities to enjoy their lives For example, this choice may let young couples have a richer social life, pursue their interests and hobbies or even to travel the world However, this tendency could have negative consequences in terms of both family life and society An important concern for a family is that raising children could be a huge challenge for older parents Even though they might have a high socioeconomic status, as well as great experience and knowledge, it may not be easy for them to communicate with and relate to their children, due to the generation gap Another negative factor is that getting pregnant after 35 years of age oftentimes carries more potential health risks Specifically, this could increase the danger of having a miscarriage or stillbirth for older mothers, and babies might be at greater risk of having Down’s syndrome Consequently, this could negatively affect the quality of the future workforce In conclusion, there are a number of reasons why more and more people prefer giving birth later in life As a result, there could be negative influences on individual families and the society at large Page 17 of 17 ... Page of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp. edu.vn SAPP Academy No 20, 198 alley, Xa Dan street, Ha Noi Tel: 0166 7703 493 Sapp. edu.vn... 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp. edu.vn 29 The auditor of Mondays Ltd is performing a test to ensure that there are no omissions SAPP. .. Page 10 of 17 SAPP Academy Floor, No 2, Trai Ca Valley, Truong Dinh street, Ha Noi Tel 096 972 94 63 Sapp. edu.vn SAPP Academy No 20, 198 alley, Xa Dan street, Ha Noi Tel: 0166 7703 493 Sapp. edu.vn