1. Financial accounting (AS Level)
A section of Accounting, 9706
Listing 10 of 1775 questions
The following information is given about the Schubert Music Club. Schubert Music Club Balance Sheet at 31 December 2008 Cost Depreciation Net Book Value Non-current (Fixed) Assets $ $ $ Clubhouse 50 000 10 000 40 000 Instruments 06 000 05 000 01 000 56 000 15 000 41 000 Current Assets Inventory of cafe supplies 4 000 Subscriptions in arrears Cash and cash equivalents 2 100 6 500 Current Liabilities Trade payables for cafe supplies 3 000 Cafe expenses owing 1 200 Subscriptions in advance 0 300 4 500 02 000 43 000 Accumulated fund 41 000 Life subscriptions 02 000 43 000 Schubert Music Club Receipts and Payments Account for the year ended 31 December 2009 $ $ Balance b/d 2 100 Suppliers for cafe 8 400 Subscriptions – 2008 Cafe expenses 4 200 Subscriptions – 2009 2 200 Wages – cafe staff 5 000 Life subscriptions 4 000 Clubhouse repairs 6 000 Cafe takings 18 500 Sundries 2 500 Balance c/d 01 000 27 100 27 100 Additional information at 31 December 2009 Inventory for the cafe was $2 000. Suppliers for cafe purchases were owed $2 200. Cafe expenses of $50 were owing. Depreciation is to be charged on a straight line basis: Clubhouse: 4% on cost per annum Instruments: $1 000 per annum Life subscriptions are available under a scheme which started 8 years ago. The cost remains at the original $500 per person. At 31 December 2008 there were six members with life subscriptions. The life subscriptions are brought into income over 20 years commencing from the year in which payment of life subscription takes place. The ordinary subscription rate for 2009 was $100 per person. This is to be increased by 50% in 2010. No subscriptions are prepaid for 2010. $300 remained owing from 2009 but these are expected to be received during January 2010. Subscriptions owing at 31 December 2008, which were not received during 2009, are to be written off as bad debts. REQUIRED Prepare a Subscriptions Account for ordinary members for the year ended 31 December 2009 (a life subscriptions account is not required). Prepare a Cafe Trading Account for the year ended 31 December 2009. Prepare an Income and Expenditure Account for the year ended 31 December 2009. The treasurer had suggested increasing cafe prices and the rate of lifetime subscriptions but the club committee refused to do this. Instead, the committee decided to raise the ordinary subscriptions by 50%. REQUIRED Suggest three additional ways in which the club could try to minimise or eliminate the deficit in future years.
9706_w10_qp_21
THEORY
2010
Paper 2, Variant 1
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Questions Discovered
1775