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1. Financial accounting (AS Level)
A section of Accounting, 9706
Listing 10 of 1775 questions
Eleni owns a business selling computers. She does not maintain full accounting records. The following information is available. At 30 June $ At 1 July $ Equipment at valuation Inventory Trade receivables Provision for doubtful debts ? Other receivables: rent prepaid Trade payables Other payables: wages Bank 1420 Credit 860 Credit Cash in hand – Bank loan – A summary of receipts and payments made through the bank for the year ended 30 June 2021 was as follows: Receipts $ Receipts from credit customers 58 960 Cash sales banked 3 980 Sale of equipment Payments $ Payments to credit suppliers 39 750 Purchase of equipment General expenses Rent 6 860 Bank loan repayments 1 390 Bank charges Cash withdrawn 14 080 All cash sales are banked. REQUIRED Calculate total revenue for the year ended 30 June 2021. Additional information Of the cash withdrawn from the bank, Eleni took $450 each month for drawings and paid total wages of $7620 for the year. The remaining cash from the cash till was used to pay for general expenses. REQUIRED Prepare the cash account to calculate the amount paid in cash for general expenses. Cash account $ $ Additional information The following information is also available. Eleni wishes to write off an irrecoverable debt of $50 at 30 June 2021. She wishes to maintain the provision for doubtful debts at the same percentage as the previous year. Equipment sold during the year had a valuation of $140. REQUIRED Prepare the income statement for the year ended 30 June 2021. Eleni Income statement for the year ended 30 June 2021 Workings: Prepare an extract from the statement of financial position at 30 June 2021 to show the capital and liabilities section only. Eleni Statement of financial position at 30 June 2021 Capital and liabilities Additional information Eleni is concerned that she is not earning enough profit. She is considering increasing her prices by 5%. REQUIRED Advise Eleni whether or not she should increase her prices by 5%. Justify your answer. State three factors that a business should consider when making a provision for doubtful debts.
9706_w21_qp_21
THEORY
2021
Paper 2, Variant 1
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The following information has been extracted from the accounting records of T Limited at 30 June 2021. Inventory at 1 July 2020 was valued at $46 800. Inventory at 30 June 2021 was valued at $54 200. The rate of inventory turnover was 8.8 times. The gross profit margin was 45%. REQUIRED Calculate for the year ended 30 June 2021: cost of sales revenue. REQUIRED Calculate the balance of the provision for doubtful debts at 30 June 2021. Prepare the income statement for the year ended 30 June 2021. Use the space on the next page for your workings. T Limited Income Statement for the year ended 30 June 2021 $ Revenue Cost of sales Gross profit Administrative expenses Distribution costs Profit from operations Finance costs Profit for the year Additional information The following transactions had also taken place during the year ended 30 June 2021. Date Transaction 1 July 2020 Freehold property was revalued downwards by $10 000. 1 July 2020 Made a rights issue of one ordinary share of $2 each for every two shares held. This was offered at a premium of $0.75. The issue was fully subscribed. 1 March 2021 Made a bonus issue of one ordinary share of $2 each for every ten shares held. Reserves were left in the most flexible form. 31 March 2021 Paid a dividend of $0.05 per share on all shares in issue at that date. REQUIRED Prepare the statement of changes in equity for the year ended 30 June 2021. T Limited Statement of Changes in Equity for the year ended 30 June 2021 Ordinary share capital $ Share premium $ Revaluation reserve $ Retained earnings $ Total $ At 1 July 2020 440 000 – 86 320 533 820 At 30 June 2021 Additional information The directors make use of accounting ratios to interpret the information contained within the financial statements. REQUIRED State the formula for calculating the non-current asset turnover. State what information the directors would obtain from calculating the non-current asset turnover. State three limitations of ratio analysis when comparing the performance of businesses in the same industry.
9706_w21_qp_23
THEORY
2021
Paper 2, Variant 3
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The following information is available for a business for the year ended 31 March 2022. $ non-current assets at cost at 1 April 2021 62 000 provision for depreciation on non-current assets at 1 April 2021 12 000 expenses paid by cash and cheques during the year 42 200 expenses prepaid at 31 March 2022 4 600 trade receivables at 31 March 2022 25 000 A provision for doubtful debts is to be created at 2% of trade receivables. Depreciation on non-current assets is to be provided at 20% using the reducing balance method. What was the total of expenses for the year?
9706_w22_qp_11
MCQ
2022
Paper 1, Variant 1
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Questions Discovered
1775