Cisco
CompTIA
ISC
EC-Council
EXIN
Fortinet
ITIL
Juniper
Microsoft
VMware
Avaya
SAP
Google
NVIDIA
Salesforce
Amazon
Palo Alto Networks
ISC2
Splunk
ServiceNow
All Vendors
  2. Home
  3. Exams
  4. CIMA
  5. BA3

CIMA BA3 Exam
Fundamentals of Financial Accounting (Page 6 )

Updated On: 1-Feb-2026
Page 6 of 80
PDF with 393 Questions

A company's financial statements show a gross profit of $15 million. A major error in the inventory value system has been discovered resulting in an overstatement on opening inventory of $1.2 million and an understatement in closing inventory of $1.5 million.

What is the correct gross profit figure for the period?

  1. $17.7 million
  2. $15.3 million
  3. $14.7 million
  4. $12.3 million

Answer(s): A



The financial accounts, as prepared by the directors of a company, are required to show a 'true and fair view'. This means that:

  1. The accounts are accurate
  2. The accounts are prepared in accordance with the Companies Act and comply with relevant reporting standards
  3. The accounts contain no fraudulent transactions
  4. No errors were detected during the audit of the accounts

Answer(s): B



CORRECT TEXT

A company uses the reduced balance method of depreciation for its company vehicles. The vehicles are depreciated at a rate of 30% per annum.

On 31 March 2003 the company purchased a number of vehicles with a total cost of $200,000. The company's year-end is 31 December and it is company policy to charge a full year's depreciation in the year of acquisition.

The carrying value of the vehicles at 31 December 2006 will be

  1. See Explanation section for answer.

Answer(s): A

Explanation:

CORRECT TEXT IS: $48024



If closing inventory at the end of an accounting period is overvalued by $2000 and no adjustment is made, the net profit in the following accounting period will be:

  1. $2,000 overstated
  2. $2,000 understated
  3. $4,000 overstated
  4. $4,000 understated

Answer(s): B



HOTSPOT
In which section of the statement of cash flow would cash from share issues be included? Select one of the following

Statement of cash How for the year ended.......

  1. See Explanation section for answer.

Answer(s): A

Explanation:



Viewing page 6 of 80
Viewing questions 26 - 30 out of 393 questions



Post your Comments and Discuss CIMA BA3 exam prep with other Community members:

Join the BA3 Discussion