9706_s12_qp_23
A paper of Accounting, 9706
Questions:
2
Year:
2012
Paper:
2
Variant:
3
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1
Shaun is a sole trader. He pays all the sales receipts into the business bank account. He provided his accountant with the following information for the year ended 31 December 2011. Bank account summary for the year ended 31 December 2011 Dr. $ Cr. $ Rent received 16 800 Balance b/d 5 620 Trade receivables 203 200 Trade payables 122 460 Cash sales 18 510 General expenses 22 000 Wages 32 560 Motor vehicles 19 200 Equipment 17 400 Drawings 27 560 Shaun’s remaining assets and liabilities were: 1 January 2011 31 December 2011 $ $ Inventory (at cost) 22 300 17 400 Premises (at cost) 100 000 100 000 Equipment (net book value) 28 400 27 600 Motor vehicles (net book value) 65 000 68 200 Trade receivables 22 400 28 600 Trade payables 17 500 19 470 General expenses prepaid 1 100 Rent received prepaid – Rent received owing – 1 300 Wages owing 2 400 Additional information: Shaun allowed his customers discounts of $4000. Discounts received from suppliers were $3100. Shaun has decided to create a provision for doubtful debts of 2% of the trade receivables outstanding at 31 December 2011. General expenses in the bank account summary include an amount of $660 which relates to the payment of Shaun’s private house insurance. Shaun had taken goods at a cost price of $3700 for his personal use. For Examiner's Use REQUIRED Calculate the value of Shaun’s sales and ordinary goods purchased for the year ended 31 December 2011. Sales Ordinary goods purchased For Examiner's Use Prepare Shaun’s income statement for the year ended 31 December 2011. For Examiner's Use Prepare Shaun's statement of financial position at 31 December 2011.
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)  →  1.3. Accounting for non-current assets
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2
For Examiner's Use Amirtha commenced business on 1 January 2010. During the first two years of business the following non-current assets were purchased on the dates shown: Motor vehicles $ 1 January MV1 26 000 1 July MV2 18 000 1 April MV3 24 000 Equipment 1 January EQ1 30 000 1 January EQ2 44 000 Amirtha has a policy to depreciate motor vehicles at 20% per annum on cost (straight line method) and equipment at 15% per annum on cost (straight line method), rates being charged for each month of ownership. REQUIRED Calculate the total depreciation for each of the years 2010 and 2011. Motor vehicles Equipment For Examiner's Use Early in 2012, consideration was given to changing to the reducing balance method, with the following rates applying to the balance at the end of each year. Motor vehicles 25% Equipment 20% A full year’s depreciation would be charged irrespective of the date of purchase. REQUIRED Calculate the total depreciation for each of the years 2010 and 2011, using the reducing balance method for: Motor vehicles Equipment. For Examiner's Use The original profits for the first two years in business were: $86 000 $94 000 REQUIRED Prepare a statement to show the revised profits for the years 2010 and 2011, if the reducing balance method had been used. Explain why it is appropriate to use the reducing balance method for motor vehicles. For Examiner's Use The following information is also available from the books of Amirtha. 1 January 2011 31 December 2011 $ $ Wages 2 040 accrued 2 130 accrued Insurance 130 accrued 610 prepaid Rent received 1 490 prepaid 1 320 prepaid During the year ended 31 December 2011 the following transactions took place. $ Wages paid 24 100 Insurance paid 1 400 Rent received 14 000 All transactions are through the bank account. REQUIRED Prepare the following ledger accounts for the year ended 31 December 2011, showing the closing entry to the financial statements at the end of the year. Dates are not required. Wages account For Examiner's Use Insurance account Rent received account For Examiner's Use 3 Wigmore Ltd uses one factory overhead recovery rate which is a percentage of total direct labour costs. The rate is calculated from the following budgeted data. Department Factory overheads Direct labour costs Direct labour hours Direct machine hours $ $ Production 150 000 500 000 120 000 7 000 Assembly 450 000 1 000 000 225 000 10 000 Packing 360 000 900 000 200 000 – The cost sheet for job 787 shows the following information. Department Direct labour costs Direct labour hours Direct machine hours Direct material costs $ $ Production 2 400 Assembly 1 100 Packing 1 000 – General administration expenses of 20% are added to the total factory cost. The selling price to the customer is based on a 25% net profit margin. REQUIRED Calculate the current factory overhead rate for Wigmore Ltd. For Examiner's Use Prepare a detailed cost statement to calculate the selling price for job 787. Calculate the overhead rate for each department using the following methods: Percentage of direct labour cost Production Assembly Packing For Examiner's Use Direct labour hour rate Production Assembly Packing Using the direct labour hour rates calculated in , prepare a detailed cost statement to calculate the new selling price for job 787. For Examiner's Use Discuss the problems associated with using predetermined overhead absorption rates. State the effect on profits if the factory does not operate at full capacity.
1. Financial accounting (AS Level)  →  1.3. Accounting for non-current assets
1. Financial accounting (AS Level)  →  1.5. Preparation of financial statements
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
Open