9706_w23_qp_11
A paper of Accounting, 9706
Questions:
30
Year:
2023
Paper:
1
Variant:
1
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6
New equipment costing $40 000, with an estimated residual value of $6000, was acquired at the beginning of the year on 1 January. On the same date the business made the following payments in respect of the equipment. $ delivery installation 8-year maintenance contract The equipment has an estimated life of 8 years. The business uses the straight-line method of depreciation. What would be the carrying amount for this item at the end of the year on 31 December?
1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
Open
8
During the year a sole trader withdrew $3000 cash from the business bank account. Accounting entries made were a debit of $300 to the drawings account and a credit of $3000 to the bank account. In addition, $500 had been omitted from the discount received account in the trial balance. What was the balance on the suspense account before these errors were corrected?
1. Financial accounting (AS Level)  →  1.4. Reconciliation and verification
1. Financial accounting (AS Level)  →  1.2. The accounting system
Open
11
The purchases ledger control account showed a balance of $79 500 before the following errors were taken into account. A contra of $5300 between the purchases and sales ledger control accounts had been omitted. Cash purchases of $1200 made on the last day of the period had not been recorded. The discount received column in the cash book had been overcast by $6200. The returns inwards journal had been undercast by $1500. Which figure for trade payables should be included in the statement of financial position?
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements
1. Financial accounting (AS Level)  →  1.4. Reconciliation and verification
Open
12
A business has trade receivables of $52 000 at the year-end. The allowance for irrecoverable debts in the draft statement of financial position is $3000. The allowance for irrecoverable debts is to be changed to 5% of trade receivables. What is the effect of changing the allowance?
1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements
1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
Open
14
A sole trader calculated her draft profit for the year as $50 000. She asked her accountant for advice regarding four issues which she thought might affect the draft profit. A customer debt of $2000 needs to be written off as irrecoverable. She accounted for her drawings of $10 000 as if they were staff salaries. She wants to increase the value of a non-current asset by $20 000. The existing charge for depreciation is overstated by $5000. What was the profit for the year?
1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
Open
16
L and M are in partnership, sharing profits and losses in proportion to their capital invested. The following information is available. $ capital: L 68 000 M 102 000 profit for the year before appropriation 28 900 drawings: L 8 000 M 12 000 No interest is charged on drawings up to $10 000 for each partner. Interest at a rate of 5% is charged on any drawings in excess of $10 000. What was L’s share of residual profit?
1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
Open
18
The following information is available for a limited company’s financial year ended 31 December. At 1 January the total equity was $350 000. This included 100 000 ordinary shares of $1 each. On 30 June there was a rights issue of 10 000 ordinary shares for $1.50 each. This was fully subscribed. On 1 October the company paid a dividend of $0.10 per ordinary share. On 1 December a dividend was proposed totalling $20 000. Profit for the year was $26 500. What was the total equity on 31 December?
1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements
Open
26
A company is asked to make a new machine for a customer. It provides the following estimates. Materials will cost $1100. Labour will be 30 hours at a cost of $14 per hour. The company charges overheads at $10 per labour hour and has a mark-up of 30% on total cost. What is the price on the job cost sheet?
2. Cost and management accounting (AS Level)  →  2.1. Costs and cost behaviour
4. Cost and management accounting (A Level)  →  4.3. Budgeting and budgetary control
4. Cost and management accounting (A Level)  →  4.1. Activity based costing (ABC)
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29
A company makes and sells a single type of product. The following budgeted information is available. selling price $10 per unit sales volume 10 000 units variable costs $5 per unit fixed costs $25 000 The sales director has recommended a 20% reduction in the selling price of the product. Variable costs will reduce to $4 per unit. The sales volume would be expected to increase by 5%. What will be the new budgeted profit?
2. Cost and management accounting (AS Level)  →  2.2. Traditional costing methods
4. Cost and management accounting (A Level)  →  4.3. Budgeting and budgetary control
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