9706_w11_qp_23 - revisedeck

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For Examiner’s Use Carl and Daniel are in partnership. Their partnership agreement provides that: Daniel has a partnership salary of $3000 per annum Interest on capital is 6% per annum Interest on drawings is charged Residual profits / losses are shared 3:2 respectively. The partners have never kept full accounting records but provided the following information: Cash book summary for the year ended 31 December 2010 $ $ Balance b/d 2 178 Trade payables 195 911 Trade receivables 44 049 Wages 63 156 Cash sales 332 467 Purchase of machine 8 800 Rent received 7 000 General expenses 56 676 Drawings – Carl 35 660 Drawings – Daniel 26 480 The assets and liabilities were: 1 January 2010 31 December 2010 $ $ Fixed capital account – Carl 100 000Cr 100 000Cr Fixed capital account – Daniel 70 000Cr 70 000Cr Current account – Carl 3 210Cr ? Current account – Daniel 1 304Cr ? Machinery (Net Book Value) 147 000 145 000 Motor vehicle (Net Book Value) 16 000 8 000 Inventory 14 003 13 471 Trade receivables Trade payables 4 872 5 163 Wages accrued Rent receivable accrued – Rent receivable prepaid – Additional information: 1. During the year, an old machine which had cost $10 000 was traded in for $3200 in part exchange for a new machine costing $12 000. The old machine had been depreciated by $6000 over its lifetime. 2. Interest on drawings for the year amounted to: Carl – $230 Daniel – $100 For Examiner’s Use REQUIRED Prepare the income statement (trading and profit and loss account) and appropriation account for Carl and Daniel for the year ended 31 December 2010. For Examiner’s Use Prepare the partners’ current accounts (in columnar format) for the year ended 31 December 2010.

1. Financial accounting (AS Level) → 1.5. Preparation of financial statements

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For Examiner’s Use Answer Sections A and B. A Sarah runs a wholesale business. An extract from her statement of financial position (balance sheet) at 31 December 2009 shows: Motor vehicles at cost $371 000 Motor vehicle accumulated depreciation $130 000 During the financial year ended 31 December 2010 the following transactions took place. A motor vehicle purchased on 1 January 2006 for $9200 was sold on 30 June 2010 for $500. A motor vehicle was purchased on 1 April 2010 for $15 000. Depreciation is charged at 20% per annum on cost, with the rate being applied for each part of the year. No allowance is made for any residual value. All motor vehicles held by the company at 31 December 2010 had been purchased within the previous five years. All transactions are by cheque. REQUIRED Prepare the following ledger accounts for the year ended 31 December 2010. Motor vehicles account Provision for depreciation of motor vehicles account For Examiner’s Use Motor vehicle disposal account Prepare an extract from the statement of financial position (balance sheet) for non-current assets at 31 December 2010. Explain why businesses provide for depreciation on their non-current assets. For Examiner’s Use B The treasurer of Hamilton Social Club has provided the following information for the year ended 31 March 2011. 31 March 2010 31 March 2011 $ $ Café inventory at cost Café trade payables Subscriptions in arrears Equipment (net book value) Stock of stationery at cost Cash at bank 5% loan (repayable 2015) – Equipment costing $5000 was purchased on 1 April 2010. It was financed by the 5% loan. At the year end 31 March 2011, no payment of interest had been made. Included in the café inventory at 31 March 2011 were items costing $120 that were out of date. They had a net realisable value of $30. REQUIRED Prepare a statement of financial position (balance sheet) for Hamilton Social Club at 31 March 2011. Show clearly the surplus or deficit for the year. An income and expenditure account is not required.

1. Financial accounting (AS Level) → 1.3. Accounting for non-current assets

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For Examiner’s Use Redwood Manufacturing Ltd started in business on 1 January 2008 to manufacture furniture to customers’ special requirements. The following information is available for its first three years in business. $ $ $ Fixed Costs 60 000 66 000 70 000 Direct materials (per unit) Direct labour (per unit) Variable overheads (per unit) Selling price (per unit) The production and sales quantities during the period were: Production 15 000 12 000 16 000 Sales 12 000 13 000 16 000 All inventory has been valued using FIFO. REQUIRED Prepare a statement showing the gross profit for each of the three years if the company used marginal costing principles to valuing inventory ; For Examiner’s Use absorption costing principles to valuing inventory . For Examiner’s Use Prepare a statement to reconcile the amounts of profit for each of the three years calculated under both marginal costing and absorption costing principles.

2. Cost and management accounting (AS Level) → 2.2. Traditional costing methods

3. Financial accounting (A Level) → 3.1. Preparation of financial statements

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