KPMG Entrance Intern Test I. Multiple Choice Question

ACE THE FUTURE ENGLISH KPMG TEST
KPMG ENTRANCE INTERN TEST

I. MULTIPLE CHOICE QUESTION
Question 1: If there is a debit balance of $1,250 on X’s account in the books of Y, what does
it mean?
A. X owes $1,250 to Y
B. Y owes $1,250 to X
C. X has returned goods worth $1,250 to Y
D. X is owed $1,250 by Y.
Question 2: Which is not included in Audit Risk Equation?
A. Inherent Risk
B. Control Risk
C. Business Risk
D. Detection Risk
Question 3: What is the level of assurance and type of opinion that can be provided on
review engagement?
Level of assurance Report wording
A. Reasonable Positive
B. Reasonable Negative
C. Limited Positive
D. Limited Negative
Question 4: While reviewing purchases cycle, you identified that goods received notes for
raw materials purchases are not sequentially numbered. Which of the following areas would
you consider to be most at risk of material misstatement, as a result of this internal control
deficiency?
A. Rights and obligations of inventory
B. Valuation of payables
C. Existence of inventory
D. Completeness of payables
Question 5: Which of the following statements best reflects the auditors ‘s duty of
confidentiality?
A. Auditors must never, under any circumstances, disclose any matters of which they
become aware during the course of the audit to third parties, without the permission of the
client.
B. Auditors may disclose any matters in relation to criminal activities to the police or taxation
authorities, if requested to do so by the police or a tax inspector.
C. Auditors may disclose matters to third parties without their client’s consent if it is in the
public interest, and they must do so if there is a statutory duty to do so.
D. Auditors may only disclose matters to third parties without their client’s consent if the public
interest or national security is involved.
Question 6: Which of the following is not a component of an entity’s internal control?

A. The control environment
B. Control activities relevant to the audit
C. The selection and application of accounting policies
D. The information system relevant to financial reporting.
Question 7: Which one of the following journal entries is required to record goods taken from
inventory by the owner of a business?
A. Debit Drawings, Credit Purchases
B. Debit Sales, Credit Drawings
C. Debit Drawings, Credit Inventory
D. Debit Purchases, Credit Drawings
Question 8: Which of the following assertions are relevant to the audit of tangible non-current
assets?
1. Existence
2. Occurrence
3. Classification
4. Presentation
A. 1 only
B. 1, 3 and 4
C. 2, 3 and 4
D. 1, 2, 3 and 4
Question 9: You are working as a graduate trainee in a large bank. Whilst undertaking your
placement with the customer service team, you take a call from an upset client. He is claiming
that he was expecting a refund on some banking fees he was wrongly charged for but he was
not received them. He explains that a colleague of yours promised the refund would be in his
account today but the money has not arrived yet. He is getting more upset and is raising his
voice to you. What would you say to him to give the best result?
A. I will do all I can to help you with this issue. If you give me your account details I will
investigate what has happened here.
B. Let me check with the colleague you mentioned about what the situation is. If you can hold
for a couple of minutes I will speak to them and will be back with you in no time.
C. Sir, I can hear that you are really upset but I need you to calm down so that I can help
you.
D. I am sure there is a logical explanation for this. If you give me details I will look into it for
you.
Question 10: You recently submitted a paper to an upcoming professional conference that
will be attended by many people from your industry and from universities globally. You have
attended the conference in the past and it is very well attended and highly regarded in the
industry. The paper is a summary of some very complex research you have been undertaking
with some key findings that you believe people will find very interesting and useful. Upon
learning that it has been accepted, your manager asks you to think about how you will present
your findings in order to make the biggest impact. You only have a short time slot for your
presentation. How would you respond?
A. Say that you intend to use a lot of graphics and images to try and draw out a handful of
key messages.
B. Say that you intend to create a presentation that mirrors the wider research paper that you
wrote with similar section headers.
C. Ask your manager what they think would be the best approach to use based on their
experience
D. Say that you will spend a small amount of time introducing your approach to the research
but will mainly discuss your key findings and conclusions.
Question 11: Mary had a number of cookies. After eating one, she gave half the remainder
to her sister. After eating another cookie, she gave half of what was left to her brother. Mary
now had only five cookies left. How many cookies did she start with?
A. 11
B. 23
C. 22
D. 45
Question 12: The following bank reconciliation statement has been prepared for a
company:
Overdraft per bank statement $39,800
Add: Deposits credited after date $64,100
Less: Unpresented cheques presented after date $44,200

Assuming the amount of the overdraft per the bank statement of $39,800 is correct, what
should be the balance in the cash book?
A. $158,100 overdrawn
B. $19,900 overdrawn
C. $68,500 overdrawn
D. $59,700 overdrawn
Question 13: 24, 30, ?, 60, 84, 114

What number should replace the question mark?
A. 42
B. 45
C. 36
D. 40
Question 14: Which of the following costs should be included in valuing inventories of finished
goods held be a manufacturing company, according to IAS 2 Inventories?
1. Carriage inwards
2. Carriage outwards
3. Depreciation of factory plant
4. Accounts department cost relating to wages for production employees.
A. All four items
B. 2 and 3 only
C. 1, 3 and 4 only
D. 1 and 4 only
Question 15: Prisha has not kept accurate accounting records during the financial year. She
had opening inventories $6,700 and purchases goods costing $84,000 during the year. At the
year end she had $5,400 left inventories. All sales are made at a mark up on cost of 20%.
What is Prisha’s gross profit for the year?
A. $13,750
B. $17,060
C. $16,540
D. $20,675
Question 16:
1 2 4 2
3 6 12 18
1 10 28 58
1 13 51 ?
What number should replace the question mark?
A. 80
B. 109
C. 129
D. 137
Question 17: If the current ratio for a company is equal to its quick ratio, which of the following
statement is true?
A. The current ratio must be greater than one
B. The company does not carry any inventories
C. Receivables plus cash is greater than payables minus inventories
D. Working capital is positive
Question 18: Which number is the odd one out?
84129, 32418, 47632, 36119, 67626, 72927
A. 84129
B. 32418
C. 47632
D. 36119
E. 67626
F. 72927
Question 19: Which body is responsible for issuing International Financial Reporting
Standard (IFRS)?
A. IFRS Interpretations Committee
B. IFRS Advisory Council
C. International Accounting Standard Board
D. The United Nations
Question 20: The annual sales of a company are $235,000 including sales tax at 17.5%. Half
of the sales are on credit terms, half are cash sales. The receivables in the statement of
financial position are $23,500. What is the output tax?
A. $17,500
B. $20,562.5
C. $35,000
D. $41,125
II. ESSAY
At KPMG, our global core values guide the way that we interact with each other to create our
open, supportive and friendly culture. Demonstrate one of your personal values that matches
KPMG core values.

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ACE THE FUTURE ENGLISH KPMG TEST

KPMG ENTRANCE INTERN TEST

Question 6: Which of the following is not a component of an entity’s internal control?

Less: Unpresented cheques presented after date $44,200

Question 13: 24, 30, ?, 60, 84, 114

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