9706_s20_qp_12
A paper of Accounting, 9706
Questions:
30
Year:
2020
Paper:
1
Variant:
2
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3
A company purchased a machine on 1 April 2017 for $25 000. It was depreciated at 20% per annum using the straight-line method. A full year’s depreciation is charged in the year of purchase but none in the year of sale. On 30 June 2019 the machine was sold for $12 500. The company year-end is 31 December. What was the profit or loss on the disposal of the machine?
1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
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5
A trader’s trial balance did not agree at the end of the financial period and a suspense account was opened. The following errors were discovered. No entry had been made in the books of account for a purchase of inventory, $650. Purchase of a vehicle by cheque had been credited to bank but debited to motor expenses. The discount received of $300 had been correctly recorded in the purchases ledger control account and was debited to discount allowed account. The purchases account for the year had been incorrectly totalled. Which errors would affect the suspense account?
1. Financial accounting (AS Level)  →  1.4. Reconciliation and verification
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10
On 1 March a company has prepaid $3600 for 12 months’ travel costs. It also has an outstanding hotel bill of $180. During March it pays the outstanding hotel bill and a further $700 for airline tickets for the month. At 31 March it has an outstanding hotel bill of $220. What is the correct cost of travel in the income statement for March?
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements
4. Cost and management accounting (A Level)  →  4.3. Budgeting and budgetary control
Open
14
L and M are in partnership, sharing profits and losses in the ratio of 3 : 2. They have the following current account balances. L $ M $ 31 March 2019 3 000 credit 4500 debit 31 March 2020 14 200 credit 6200 debit The balances at 31 March 2020 are after taking into account the following. L $ M $ interest on drawings 1 000 1 500 interest on capital 3 000 2 000 drawings 10 000 15 000 What was the residual profit to be shared between L and M for the year ended 31 March 2020?
1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
Open
16
On 1 December 2019 a company’s statement of financial position included the following. $ ordinary shares of $5 each 2 500 000 share premium 850 000 retained earnings 710 000 15 December paid an ordinary share interim dividend of $0.15 per share 23 December made a bonus issue of 25 000 ordinary shares Reserves were kept in their most flexible form. What were the balances on the revenue reserves and capital reserves accounts after these transactions?
1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements
1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets
Open
18
The rate of inventory turnover of a company has been calculated for two successive periods. current period 5.6 times previous period 4.8 times The following statements have been made about the change. Inventory is moving more slowly in the current period. Inventory is moving more quickly in the current period. Management of inventory has been more efficient in the current period. Which statements may explain the change?
2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
Open
19
The following items appear on a statement of financial position. $ inventory 20 000 cash and cash equivalents 3 500 trade payables 11 000 provision for doubtful debts The current ratio is 3 : 1. How much do the trade receivables owe?
1. Financial accounting (AS Level)  →  1.6. Analysis and communication of accounting information
1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
Open
21
A business provided the following information. budgeted overheads $20 000 budgeted direct labour hours direct labour rate $20 per hour A job used materials costing $45 and 6 hours of direct labour. Overheads are charged on the basis of direct labour hours used. What was the cost of the job before adding any profit?
2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour
4. Cost and management accounting (A Level)  →  4.2. Standard costing
2. Cost and management accounting (AS Level)  →  2.2. Traditional costing methods
Open
29
A manufacturer produces a single product. The following information is available. $ selling price per unit variable costs per unit fixed costs per annum 96 000 There are plans to reduce the selling price by $3 per unit and to reduce variable costs by $1 per unit. Fixed costs will remain unchanged. What will be the new break-even point?
2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour
2. Cost and management accounting (AS Level)  →  2.2. Traditional costing methods
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