CIMA BA3 : Fundamentals of Financial Accounting

  • Exam Code: BA3
  • Exam Name: Fundamentals of Financial Accounting
  • Updated: Oct 26, 2026
  • Q & A: 395 Questions and Answers

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CIMA BA3 Exam Syllabus Topics:

SectionWeightObjectives
Preparation of Accounts for Single Entities30%- Adjusting entries and trial balance
- Preparation of income statement
- Preparation of simple cash flow statement
- Preparation of statement of financial position
- Manufacturing and inventory accounting
Analysis of Financial Statements10%- Interpretation using accounting ratios
- Limitations of financial statements
- Liquidity, profitability and solvency analysis
Recording Accounting Transactions50%- Accounting for assets, liabilities, equity and expenses
- Reconciliations (bank, receivables, payables)
- Sources of records and books of prime entry
- Correction of errors and control accounts
- Double-entry bookkeeping and ledger accounts
Accounting Principles, Concepts and Regulations10%- Nature and objective of financial accounting
- Accounting standards and principles
- Conceptual and regulatory framework
- Elements of financial statements

CIMA Fundamentals of Financial Accounting Sample Questions:

Question #1

Which one of the following is an error of principle?

  • A. The purchase of a non-current asset debited to the purchases account and credited to the payable's account
  • B. The purchase of a non-current asset credited to the asset at cost account and debited to the payable's account
  • C. The payment of wages debited and credited to the correct accounts, but using the wrong amount
  • D. A gas bill credited to the gas account and debited to the bank account
Reveal Solution  Discussion  0

Correct Answer: A  🗳️

Question #2

A public limited company declares a 10% final dividend.
The nominal value of the shares is 50p and the shares are currently trading, in the stock market, at a price of £2.
A shareholder who purchased 1000 shares at a price of £1.00 per share, will receive a dividend of:
Give your answer to 2 decimal places.

Reveal Solution  Discussion  0

Correct Answer:

£49.99

Question #3

Refer to the Exhibit.

A club receives the following fees in its first two years of operations:
Entrance fees are to be recognized over a period of 5 years while life membership fees are to be credited over a period of 10 years.
The total amount of fees which will be recognized in the income and expenditure account for each of the two years is:

  • A. Year 1 - £27000 Year 2 - £45500
  • B. Year 1 - £27000 Year 2 - £44500
  • C. Year 1 - £36000 Year 2 - £49000
  • D. Year 1 - £27000 Year 2 - £38500
Reveal Solution  Discussion  0

Correct Answer: A  🗳️

Question #4

Which of the following transactions would be classified as a revenue transaction?

  • A. Purchase of inventory for resale
  • B. Issue of share capital
  • C. Purchase of plant and machinery
  • D. Payments made to trade payables
Reveal Solution  Discussion  0

Correct Answer: A  🗳️

Question #5

Company A has a receivables turnover ratio of six times, while Company B, which operates in the same market sector, has a receivables turnover ratio of five times.
This suggests that

  • A. Company A has a lower level of receivables than Company B and is, therefore, more efficient than Company B.
  • B. Company A has a lower level of receivables than Company B and is, therefore, less efficient than Company B.
  • C. Company A has a higher level of receivables than Company B and is, therefore, more efficient than Company B.
  • D. Company A has a higher level of receivables than Company B and is, therefore, less efficient than Company B.
Reveal Solution  Discussion  0

Correct Answer: A  🗳️

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