9706_w13_qp_23
A paper of Accounting, 9706
Questions:
3
Year:
2013
Paper:
2
Variant:
3
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1
The Cardio Health Club operates a fitness centre and a shop and has the following assets and liabilities. 1 June 2012 31 May 2013 $ $ Premises 100 000 100 000 Sports equipment (at cost) 30 000 115 000 Sports equipment – depreciation provision 5 000 14 400 Shop inventory 8 500 4 800 Cash Bank (current account) 10 000 ? Bank (deposit account) 2 000 ? Subscriptions outstanding 4 200 5 600 Subscriptions paid in advance 4 000 3 500 Shop staff wages accrued 1 000 3 000 Insurance paid in advance 1 000 Loan from sports association 40 000 The receipts and payments in the bank current account for the year ended 31 May 2013 were: Receipts $ Shop revenue 120 000 Subscriptions 44 000 Loan from sports association 40 000 Donations Payments $ Wages of fitness coaches 16 000 Sports equipment 85 000 Printing and stationery 5 500 Transfer to deposit account Sundry expenses Insurance 12 000 Heating and lighting 20 000 Wages of shop staff 27 000 Shop purchases for resale 32 500 Additional information The wages of shop staff are treated as a direct cost. Insurance and heating and lighting are apportioned 80:20 between the fitness club and the shop. The loan from the sports association was received on 1 December 2012. Interest is payable at 6% per year. Donations are treated as revenue. During the year interest amounting to $90 had been credited to the bank deposit account. For Examiner's Use REQUIRED Prepare the shop income statement for the year ended 31 May 2013. For Examiner's Use Prepare the income and expenditure account of the Cardio Health Club for year ended 31 May 2013. For Examiner's Use Prepare the statement of financial position of the Cardio Health Club at 31 May 2013.
3. Financial accounting (A Level)  →  3.1. 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 Luing Limited’s financial information for the year ended 31 December 2012 revealed the following: Gross profit ratio 35% Net profit ratio 14% Rate of inventory turnover 10 times Trade payables turnover 42 days Trade receivables turnover 58 days Current ratio 3:1 Inventory at 1 January 2012 $7 800 000 Total revenue (all on credit) for 2012 $85 000 000 All purchases were on credit. REQUIRED For the year ended 31 December 2012, calculate Gross profit Cost of sales Closing inventory Ordinary goods purchased For Examiner's Use Profit for the year Expenses Trade payables Trade receivables For Examiner's Use Identify three possible users of accounting ratios other than the directors of the company. State what information the users would obtain from the ratios.
1. Financial accounting (AS Level)  →  1.6. Analysis and communication of accounting information
3. Financial accounting (A Level)  →  3.5. Analysis and communication of accounting information
3. Financial accounting (A Level)  →  3.1. Preparation of financial statements
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3
For Examiner's Use Argon is a manufacturing business divided into three separate departments, machining, finishing and stores. The total estimated costs for the three months ending 31 October 2013 are as follows: $ Depreciation of plant 6 000 Lighting and heating 4 500 Plant insurance 4 800 Rent 18 000 Supervision 25 000 The following information is available for the three departments: Machining Finishing Stores Floor area (sq metres) Number of employees Value of plant ($000’s) Number of orders from Stores - Budgeted machine hours - Budgeted direct labour hours - REQUIRED Apportion the costs to the three departments using the most suitable basis. Clearly state the basis you have used. For Examiner's Use Re-apportion stores costs to each production department on the basis of the number of orders. Calculate to two decimal places the forecast overhead absorption rate for the machining and finishing departments for the three months ending 31 October 2013. For Examiner's Use Actual figures for the three months ended 31 October 2013 are: Machining Finishing Direct labour hours 1 430 5 000 Machine hours 6 000 Overheads incurred $48 340 $22 780 REQUIRED Calculate the amount of overhead absorbed for each production department for the three months ended 31 October 2013. Calculate the amount of under or over absorption for each production department. For Examiner's Use Explain what is meant by over and under absorption of overheads and how each will arise.
2. Cost and management accounting (AS Level)  →  2.2. Traditional costing methods
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