100+ Free ICAEW ACA Accounting Practice Questions

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2026 Statistics

Key Facts: ICAEW ACA Accounting Exam

26 questions

24 short-form objective questions plus two scenario-based questions

ICAEW — Accounting Fundamentals exam overview

60% / 40%

Short-form questions carry 60% of the marks and the two scenario questions 40%

ICAEW — Accounting Fundamentals exam overview

2 hours

Duration of the computer-based Accounting Fundamentals exam

ICAEW — Accounting Fundamentals exam overview

55%

Pass mark for ICAEW ACA Certificate Level exams

ICAEW / Kaplan — ACA exam structure

Certificate Level

Accounting Fundamentals is one of the Certificate Level (and ICAEW CFAB) exams

ICAEW — Certificate Level exam resources

September 2025

Renamed from 'Accounting' to 'Accounting Fundamentals' under Next Generation ACA

ICAEW — Next Generation ACA syllabus 2025/2026

Computer-based

Taken on demand at a test centre or by remote invigilation

ICAEW — How to book an exam

100

Free original practice questions in this bank

OpenExamPrep

ICAEW ACA Accounting Fundamentals (formerly 'Accounting') is a Certificate Level exam in the ICAEW ACA qualification, introduced under the Next Generation ACA syllabus from September 2025. The computer-based exam lasts 2 hours and has 26 questions: 24 short-form objective questions worth 60% of the marks and two scenario-based questions worth 40%. The pass mark is 55%. It covers double-entry bookkeeping, the trial balance, correction of errors and the suspense account, inventory valuation, irrecoverable debts and allowances, accruals and prepayments, depreciation, bank and control account reconciliations, and preparing financial statements for sole traders, partnerships and limited companies. This 100-question bank provides original IFRS-aligned UK practice across all of these areas, with many computational items and full worked explanations.

Sample ICAEW ACA Accounting Practice Questions

Try these sample questions to test your ICAEW ACA Accounting exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1The accounting equation can be expressed as:

A.Assets = Capital + Liabilities

B.Assets = Capital - Liabilities

C.Capital = Assets + Liabilities

D.Liabilities = Assets + Capital

Explanation: The accounting equation states that a business's assets are funded by amounts owed to the owner (capital) and amounts owed to outsiders (liabilities). It always balances: Assets = Capital + Liabilities.

2A business has assets of £80,000 and liabilities of £30,000. What is the owner's capital?

A.£110,000

B.£50,000

C.£30,000

D.£80,000

Explanation: Rearranging the accounting equation, Capital = Assets - Liabilities = £80,000 - £30,000 = £50,000. Capital represents the owner's residual interest in the business.

3Which of the following correctly records a business buying goods for resale on credit?

A.Debit purchases, credit cash

B.Debit purchases, credit payables

C.Debit payables, credit purchases

D.Debit inventory, credit sales

Explanation: A credit purchase increases the expense of purchases (debit) and creates an amount owed to the supplier (credit to payables). No cash moves at the point of purchase.

4In which book of prime entry is a credit sale first recorded?

A.Cash book

B.Sales day book

C.Purchases day book

D.Journal

Explanation: Credit sales are first listed in the sales day book (sales journal) from sales invoices, before being posted to the receivables and sales ledger accounts.

5Which of the following is an example of a current asset?

A.A delivery van

B.Trade receivables

C.A bank loan

D.Owner's capital

Explanation: Trade receivables are amounts owed by customers and are expected to be recovered within one year, so they are current assets. A delivery van is a non-current asset.

6A business pays £600 cash for office rent. What is the double entry?

A.Debit cash, credit rent expense

B.Debit rent expense, credit cash

C.Debit rent expense, credit payables

D.Debit cash, credit capital

Explanation: Paying rent increases an expense (debit rent expense) and reduces the cash asset (credit cash). Expenses are debits; cash going out is a credit.

7Which statement about debits and credits is correct?

A.A debit entry increases a liability

B.A credit entry increases income

C.A debit entry decreases an asset

D.A credit entry increases an expense

Explanation: Income (revenue) has a credit balance, so a credit entry increases it. Assets and expenses increase with debits; liabilities, capital and income increase with credits.

8A customer who bought goods on credit returns some of them. In the seller's records, this is recorded as:

A.Debit sales returns, credit receivables

B.Debit receivables, credit sales returns

C.Debit purchases returns, credit payables

D.Debit sales returns, credit cash

Explanation: Goods returned by a credit customer reduce the amount they owe (credit receivables) and are recorded as sales returns (debit), which reduces net sales.

9The owner withdraws £500 from the business bank account for personal use. This is recorded as:

A.Debit drawings, credit bank

B.Debit bank, credit drawings

C.Debit wages, credit bank

D.Debit drawings, credit capital

Explanation: Drawings reduce the owner's capital and are recorded by debiting drawings and crediting bank (cash leaving the business). Drawings are not a business expense.

10A trial balance is prepared in order to:

A.Calculate the business's profit

B.Check that total debits equal total credits

C.List only the asset balances

D.Prove there are no errors at all

Explanation: A trial balance lists all ledger balances and checks that total debits equal total credits. It is an arithmetic check on the double entry, not a guarantee that no errors exist.

About the ICAEW ACA Accounting Exam

Accounting Fundamentals is a Certificate Level exam in the ICAEW ACA qualification (and is also part of ICAEW CFAB). Renamed from 'Accounting' under the Next Generation ACA syllabus introduced from September 2025, it introduces the principles of double-entry bookkeeping and teaches students how to maintain accounting records and prepare simple financial statements. The syllabus covers the accounting equation, recording transactions through books of prime entry and ledgers, extracting and correcting a trial balance, period-end adjustments (inventory, irrecoverable debts and allowances, accruals and prepayments, depreciation), bank and control account reconciliations, and the preparation of the income statement and statement of financial position for sole traders, partnerships and limited companies. The computer-based exam lasts two hours and contains 24 objective short-form questions plus two scenario-based questions.

Assessment

26 questions in total: 24 short-form questions worth 60% of the marks (multiple-choice, multi-part multiple-choice or multiple-response) and two scenario-based questions worth 40% of the marks.

Time Limit

2 hours (120 minutes). From March 2026 the booked appointment includes an extra five minutes for an optional survey that does not count as exam time.

Passing Score

55% — the standard pass mark for ICAEW ACA Certificate Level exams.

Exam Fee

Set by ICAEW and payable per sitting; the Accounting Fundamentals exam fee is around £85 per attempt. Fees are reviewed annually, so confirm the current amount on the ICAEW fees schedule. (Institute of Chartered Accountants in England and Wales (ICAEW))

ICAEW ACA Accounting Exam Content Outline

30%

Maintaining financial records

The accounting equation (assets = capital + liabilities), books of prime entry, the general and subsidiary ledgers and double-entry bookkeeping. Practice covers recording transactions for cash, sales, purchases, receivables, payables, inventory, non-current assets and capital, posting to ledger accounts, and extracting a trial balance.

35%

Adjustments to accounting records and financial statements

Period-end adjustments and reconciliations. Practice covers inventory valuation (FIFO and weighted average AVCO, and lower of cost and net realisable value), irrecoverable debts and the allowance for receivables, accruals and prepayments, depreciation (straight-line and reducing balance) and disposals, correction of errors and the suspense account, and bank and control account reconciliations.

35%

Preparing financial statements

Preparing the income statement and statement of financial position. Practice covers sole traders, partnerships (profit appropriation, capital and current accounts, drawings) and limited companies, calculating gross and net profit, applying adjustments to the trial balance, and presenting figures using IFRS-aligned UK terminology (receivables, payables, statement of financial position).

How to Pass the ICAEW ACA Accounting Exam

What You Need to Know

Passing score: 55% — the standard pass mark for ICAEW ACA Certificate Level exams.
Assessment: 26 questions in total: 24 short-form questions worth 60% of the marks (multiple-choice, multi-part multiple-choice or multiple-response) and two scenario-based questions worth 40% of the marks.
Time limit: 2 hours (120 minutes). From March 2026 the booked appointment includes an extra five minutes for an optional survey that does not count as exam time.
Exam fee: Set by ICAEW and payable per sitting; the Accounting Fundamentals exam fee is around £85 per attempt. Fees are reviewed annually, so confirm the current amount on the ICAEW fees schedule.

Keys to Passing

Complete 500+ practice questions
Score 80%+ consistently before scheduling
Focus on highest-weighted sections
Use our AI tutor for tough concepts

ICAEW ACA Accounting Study Tips from Top Performers

1Master the double-entry rules first: debits increase assets and expenses, credits increase liabilities, capital and income. Almost every question depends on getting the debit and credit the right way round.

2Practise the full sequence from trial balance to financial statements so you can slot accruals, prepayments, depreciation and irrecoverable debts into the right place quickly.

3Be confident with both inventory methods: FIFO assumes the oldest units are sold first, while AVCO recalculates a weighted average cost; apply the lower of cost and net realisable value at the end.

4Learn the suspense account: a debit-heavy trial balance imbalance needs a credit to suspense, and clearing the suspense account is how you correct one-sided and transposition errors.

5For depreciation, separate straight-line (cost less residual, spread evenly) from reducing balance (a fixed percentage on the carrying amount), and watch for part-year and disposal adjustments.

6Use the ICAEW pilot and sample exams to get used to the on-screen calculator, the answer-entry format for scenario questions, and pacing across 26 questions in two hours.

Frequently Asked Questions

What is the ICAEW ACA Accounting Fundamentals exam?

It is a Certificate Level exam in the ICAEW ACA qualification (and ICAEW CFAB) that introduces double-entry bookkeeping and the preparation of simple financial statements. It was renamed from 'Accounting' to 'Accounting Fundamentals' under the Next Generation ACA syllabus from September 2025.

How many questions are on the exam and how is it marked?

The exam has 26 questions. Twenty-four are short-form objective questions (multiple-choice, multi-part multiple-choice or multiple-response) worth 60% of the marks, and two are scenario-based questions worth 40% of the marks.

What is the pass mark for Accounting Fundamentals?

The pass mark is 55%, which is the standard pass mark for all ICAEW ACA Certificate Level exams.

How long is the exam?

The exam lasts 2 hours (120 minutes). From March 2026 the booked appointment length includes an extra five minutes for an optional post-exam survey, which does not form part of the exam time.

What terminology does the exam use?

It uses IFRS-aligned UK terminology, such as 'statement of financial position' rather than 'balance sheet', and 'receivables' and 'payables' rather than 'debtors' and 'creditors'. Inventory is valued at the lower of cost and net realisable value.

Are these official ICAEW practice questions?

No. These are original OpenExamPrep questions modelled on the official syllabus skills. ICAEW provides its own question bank, pilot exam and sample exams through its learning materials and practice software.