QUESTION: 45

Which of the following is a feature of value added tax (VAT)?

Only registered entities can charge VAT on sales or recover VAT paid on purchases.
The value of all supplies must be taken into account when determining whether the registration threshold has been exceeded.
Entities cannot register for VAT if the value of their taxable supplies is below the registration threshold.
Entities that make only standard-rated or zero-rated supplies have their right to recover input tax restricted.

Answer(s): A

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QUESTION: 46

PZ has the following working capital ratios:

Which of the following could be the reason for the movements?

PZ has introduced a new policy to take discounts from suppliers during 20X1.
The workforce of PZ have been on strike for a month during 20X1 but deliveries of inventory have still been received by the entity.
A new credit controller has been employed who has been more rigorous with their collection procedure of receivables.
PZ has implemented a just-in-time system of ordering inventory during 20X1.

Answer(s): B

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QUESTION: 47

Which of the following is the responsibility of the International Financial Reporting Standards Interpretations Committee?

The development and publication of new international financial reporting standards.
To provide a forum for interested parties to participate in the formulation of international financial reporting standards.
To provide authoritative guidance on the application of international financial reporting standards where conflicting practice has developed.
To advise the International Accounting Standards Board on the agenda and priorities for future work.

Answer(s): C

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CORRECT TEXT
PP supplies zero-rated and standard-rated goods. During the year ended 30 March 20X3, the standard-rated goods made up 50% of the total supplies. During the year ended 30 March 20X4 this percentage increased to 60%.
What percentage of input tax suffered can PP claim back in the year ended 30 March 20X4? Give your answer as a whole number.

100%

Answer(s): A

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QUESTION: 48