Free Practice Questions for CTA Accounting CBE

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Key Facts: CTA Accounting CBE Exam

100

Practice Questions

OpenExamPrep

Official CBE Questions

CIOT CBEs page / ATT About Examinations

1 hour

Time Limit

CIOT CBE Guidance on Success

60%

Pass Mark

CIOT CBE FAQs / Guidance on Success

£127

Fee per CBE Attempt

CIOT CTA Student Fees 2026

£70

Principles of Accounting Manual

CIOT CTA Student Fees 2026

CTA Accounting CBE: 40 questions, 1 hour, 60% pass, £127 per attempt via Prometric. Compulsory CBE alongside Law and Ethics. Syllabus is the Principles of Accounting manual. Sit CIOT sample CBEs, then use these 100 free practice questions for deeper revision.

Sample CTA Accounting CBE Practice Questions

Try these sample questions to review concepts for the CTA Accounting CBE exam. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1Under the accounting equation used in the Principles of Accounting CBE, which restatement is correct for a sole trader?

A.Assets − Liabilities = Capital + Profits − Drawings

B.Assets + Liabilities = Capital − Profits + Drawings

C.Assets = Capital − Liabilities − Profits

D.Liabilities − Assets = Capital + Drawings

Explanation: The accounting equation can be rearranged as Assets − Liabilities = Capital + Profits − Drawings. Net assets equal the proprietor's interest after profits and drawings.

2Amounts due to suppliers for goods purchased on credit are classified as:

A.Revenue for the period

B.A liability

C.An asset

D.Drawings

Explanation: Trade payables (creditors) are amounts owed by the business and are liabilities.

3Drawings by a sole trader are part of:

A.Revenue

B.Non-current assets

C.Proprietor's funds (capital)

D.Trade payables

Explanation: Drawings reduce the proprietor's interest and are treated within capital/proprietor's funds.

4A trial balance still balances after which type of error?

A.A single-sided entry posted to one account only

B.A transposition that affects only one account

C.Posting a debit as a credit with no compensating entry

D.An error of omission where a transaction is completely omitted from both sides

Explanation: Complete omission of a transaction (neither debit nor credit recorded) leaves the trial balance in balance, though the accounts are incomplete.

5Discounts allowed to customers are treated in the profit and loss account as:

A.An expense

B.Income

C.A capital introduction

D.A direct reduction of share capital in company accounts only

Explanation: Discounts allowed are an expense. Discounts received from suppliers are income.

6Discounts received from suppliers are treated in the profit and loss account as:

A.A fixed asset

B.Income

C.An expense

D.Drawings

Explanation: Discounts received are recognised as income in the profit and loss account.

7Which of the following is capital expenditure?

A.Buying food for staff lunches

B.Paying the electricity bill for the quarter

C.Purchase of a delivery van for long-term business use

D.Paying the monthly office rent

Explanation: Capital expenditure acquires or improves a non-current asset that will benefit future periods. Rent, food and electricity are revenue expenses.

8The cost of purchasing goods for resale is recorded by debiting:

A.Sales

B.Retained earnings

C.Drawings

D.Purchases

Explanation: Goods bought for resale are debited to Purchases. The purchases account accumulates cost of goods bought.

9The cost of a new machine acquired for use in the business is debited to:

A.A non-current (fixed) asset account

B.Purchases of goods for resale

C.Drawings

D.Sales returns

Explanation: Acquisition cost of a fixed asset is capitalised by debiting the relevant non-current asset account.

10Receiving cash of £400 from a credit customer is recorded by:

A.Debiting drawings and crediting sales

B.Debiting bank/cash and crediting receivables (debtors)

C.Debiting receivables and crediting bank

D.Debiting purchases and crediting bank

Explanation: Cash received increases the bank (debit) and clears the customer's receivable (credit to debtors).

About the CTA Accounting CBE Exam

The CTA Principles of Accounting CBE is a compulsory one-hour computer-based examination of 40 questions for Chartered Tax Adviser students. It tests accounting areas that impact tax practitioners — double entry, financial statements for sole traders/partnerships/companies, depreciation, inventory, receivables, tax accounting (including deferred tax timing differences), cash flows and performance analysis — based entirely on the Principles of Accounting manual. The pass mark is 60%. Each CBE attempt costs £127 (CIOT CTA student fees 2026). A basic calculator (non-Accounting, non-Scientific) is allowed at test centres for Accounting only; an onscreen calculator is also available.

Exam sponsor: Chartered Institute of Taxation (CIOT). The requirements and fees below concern the certification or admission exam, separate from our free practice resources.

Assessment

Compulsory computer-based exam for CTA candidates (unless exempt). Book via CIOT/Prometric; mix of MCQ, multiple response, drag-and-drop and select-from-list. Immediate on-screen result. Two official sample exams (40Q each).

Time Limit

1 hour

Passing Score

60% (24 of 40)

Exam / Certification Fees

£127 per attempt

Exam sponsor website

Fees, eligibility, and exam policies can change. Confirm them with the exam sponsor before applying or paying.

Official sources

Our practice resources: topics covered

We aim to reflect publicly available exam outlines and topic information in our study resources. Coverage, format, and difficulty may differ from the actual exam, and we cannot guarantee that every detail is accurate or current. Confirm exam requirements, fees, and policies with the official exam sponsor.

22%

Double entry and bookkeeping basics

Equation, journals, TB/errors, discounts, capital vs revenue, VAT

Accruals and prepayments

Accruals, prepayments, deferred income, overdrafts

10%

Non-current assets and depreciation

Cost, depreciation methods, disposals, tax add-back

Intangibles and grants

R&D, goodwill, government grant models

Inventory

Cost/NRV, COS, FIFO, write-downs

Receivables and provisions

Bad/doubtful debts, recoveries, debtor days

14%

Business entities and equity

Sole traders, partnerships, company equity, contingencies

10%

Tax accounting

CT charge/liability, temporary vs permanent differences

Cash flow statements

Operating/investing/financing and indirect method

Ratios and performance

Margins, liquidity and activity ratios

Preparing for the CTA Accounting CBE Exam

What You Need to Know

Passing score: 60% (24 of 40)
Assessment: Compulsory computer-based exam for CTA candidates (unless exempt). Book via CIOT/Prometric; mix of MCQ, multiple response, drag-and-drop and select-from-list. Immediate on-screen result. Two official sample exams (40Q each).
Time limit: 1 hour
Exam / certification fees: £127 per attempt Official sources

Using Our Practice Resources

Work through all 100 available questions
Review every answer and explanation
Track weak areas and revisit them
Use our AI tutor for tough concepts

CTA Accounting CBE: Suggested Study Strategy

1Buy and work the current Principles of Accounting manual — CIOT CBEs are book-syllabus assessments

2Sit both official sample Accounting CBEs under timed conditions before booking the live exam

3Memorise temporary vs permanent differences: depreciation/CA differences reverse; much business entertaining does not

4Drill cash flow classifications: share and debenture proceeds are financing; asset sale proceeds are investing

5Practise provision and inventory NRV calculations with the onscreen calculator under time pressure

6Aim for ~90 seconds per question to match the live 40 questions / 60 minutes pace

Frequently Asked Questions

How many questions are on the CTA Principles of Accounting CBE?

The official Accounting CBE has 40 questions in one hour (unlike Law and Ethics, which have 50). This practice set has 100 MCQs for broader syllabus coverage.

What is the pass mark for CTA Accounting?

You need 60% to pass each CIOT CBE, including Accounting (24 correct out of 40).

How much does the Accounting CBE cost?

Each attempt at Law, Professional Responsibilities & Ethics, or Principles of Accounting costs £127 according to the CIOT CTA student fees page for 2026. Confirm the current figure on tax.org.uk/CTA-student-fees before booking.

What should I study for Accounting?

CIOT states questions are drawn entirely from the Principles of Accounting manual. Topics include double entry, financial statements for sole traders/partnerships/companies, and analysis of business performance — reflected in the official sample Accounting CBEs.

Are calculators allowed?

For the Accounting CBE only, you may take a basic calculator (non-Accounting, non-Scientific) into a test centre. An onscreen calculator is also available for Accounting questions.

How should I use this free practice bank?

After reading the manual and sitting both official 40-question sample Accounting CBEs, work through all 100 questions by category, review every miss, and re-test weak areas (tax timing differences, cash flow classification and provisions are frequent trip-ups).