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ACCA Applied Knowledge Practice Questions
Original practice questions for the ACCA Applied Knowledge exams (BT, MA, FA) (Association of Chartered Certified Accountants (ACCA)), mixed across 3 topics with instant answers and explanations. Practise by topic below or take the timed mock test.
ACCA Applied Knowledge mixed practice
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Q1.Accounting & FinanceDiversification mainly reduces:
Show answer & explanation
Answer: D — Unsystematic (specific) risk
Holding many assets reduces company-specific risk, not market risk.
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Q2.Simple & Compound InterestFind the compound interest on £4,000 at 20% per annum for 2 years, compounded annually.
Show answer & explanation
Answer: B — £1,760
A = P(1 + R/100)^T = 4,000 × 1.20^2 = 5,760; CI = A − P = £1,760.
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Q3.Economy & Banking AwarenessA bear market is characterised by:
Show answer & explanation
Answer: C — Falling prices
A bear market is a sustained decline in asset prices (often 20% or more).
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Q4.Accounting & FinanceWhat is the present value of £3,000 received in 2 years at a 8% discount rate?
Show answer & explanation
Answer: D — £2,572
PV = FV/(1 + r)ⁿ = 3,000 / 1.08^2 = £2,572.
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Q5.Simple & Compound InterestFind the simple interest on £55,000 at 4% per annum for 4 years.
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Answer: B — £8,800
SI = P × R × T / 100 = 55,000 × 4 × 4 / 100 = £8,800.
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Q6.Economy & Banking AwarenessWhich instrument is used for transferring money electronically in real time for large values in India?
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Answer: B — RTGS
RTGS settles individual large-value transactions in real time.
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Q7.Accounting & FinanceThe time value of money means:
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Answer: D — A sum today is worth more than the same sum in the future
Money available now can be invested to earn a return.
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Q8.Simple & Compound InterestFind the compound interest on £12,000 at 20% per annum for 2 years, compounded annually.
Show answer & explanation
Answer: A — £5,280
A = P(1 + R/100)^T = 12,000 × 1.20^2 = 17,280; CI = A − P = £5,280.
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Q9.Economy & Banking AwarenessA cheque that is presented more than three months after its date is:
Show answer & explanation
Answer: B — Stale
In India a cheque is valid for three months; after that it is stale.
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Q10.Accounting & FinanceWhat is the present value of £16,000 received in 7 years at a 8% discount rate?
Show answer & explanation
Answer: D — £9,336
PV = FV/(1 + r)ⁿ = 16,000 / 1.08^7 = £9,336.
About ACCA Applied Knowledge
ACCA Applied Knowledge exams (BT, MA, FA) — conducted by Association of Chartered Certified Accountants (ACCA). The first ACCA level: Business & Technology, Management Accounting and Financial Accounting.
Original practice questions written for this site in the style and difficulty of each exam’s syllabus. They are not past papers and the site is not affiliated with any exam body. Exam patterns, marking schemes and syllabi change — always check the latest official notification.
Practise by topic
- Accounting & Finance questions — Master the accounting equation, the three financial statements and time value of money: FV = PV(1 + r)ⁿ, PV of an annuity = PMT × [1 − (1 + r)⁻ⁿ]/r.
- Simple & Compound Interest questions — Simple interest grows linearly (PRT/100); compound interest multiplies by (1 + r/100) each period.
- Economy & Banking Awareness questions — Know what each regulator does (RBI, SEBI, IRDAI, PFRDA), the policy tools (repo, CRR, SLR) and the definitions behind GDP, inflation and fiscal deficit.
- ACCA Applied Knowledge mock test — 25 timed questions.
ACCA Applied Knowledge practice topics
| Topic | Section | Question source |
|---|---|---|
| Accounting & Finance | Finance | Calculated + question bank |
| Simple & Compound Interest | Quantitative aptitude | Calculated (new numbers every set) |
| Economy & Banking Awareness | General awareness | Question bank |