Free CXC Principles of Accounts Paper 1 May/June 2002 past paper from 2002. Includes a worked answer key. Open the PDF, take a timed test, and study with AI on Caribbean AI.
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CSEC Principles of Accounts Paper 1 May/June 2002 - Free CXC Past Paper with Answers
Free CXC Principles of Accounts Paper 1 May/June 2002 past paper from 2002. Includes a worked answer key. Open the PDF, take a timed test, and study with AI on Caribbean AI.
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Employees of a business are entitled to annual profit sharing bonus of 20%. Profit for the year was $10 000 before tax and bonus. If tax is to be 30%. What is the amount for bonus?
$1 400
$2 000
$4 400
$7 000
Control accounts are kept so as to assist management in
limiting expenditure
locating errors
increasing profits
limiting drawings
Ms Morris purchases $1 000 worth of fur- niture for office use and entered it in the journal as purchases. How will this error affect her Balance Sheet?
Fixed assets and net profit will be decreased by $1 000.
Fixed assets and net profit will be increased by $1 000.
Current assets and net profit will be increased by $1 000.
Current assets and net profit will NOT be affected.
An invoice is a document made out when goods are
overcharged
returned
undercharged
sold
Item 5 refers to the following information. $ Carriage inwards 125 Sales 5 500 Returns inwards 365 Purchases 4 520 Closing stock 900
Using the information above, what will be the cost of goods sold?
$3 620
$3 745
$4 645
$4 985
Item 6 refers to the following information: Stock at Jan 1, 1994 $ 500 Purchases during the month $1 200 Cost of goods sold $1 400
What is the stock at the end of January?
$ 300
$ 700
$ 500
$1 200
The following deductions are made from the salary of an employee.
DEDUCTIONS Income tax 35% National housing 2% Education tax 1%
What is the total amount which should be deducted from the employee's salary of $1 800 per month?
$486
$648
$684
$846
Under which of the following conditions would a trial balance still balance?
I. A transaction was completely left out. II. Both a debit and credit entry were overstated by the same amount. III. A debit entry was left out. IV. Both a debit and credit entry were understated by the same amount.
I, II and III only
I, II and IV only
I, III and IV only
II, III and IV only
The purpose of an appropriation account is to
change capital expenditure as agreed upon in the Articles of Association
show how the net profit is distributed in a partnership or co-operative
make appropriate changes related to net profit as agreed upon in the Articles of Association.
enter all capital and revenue expenditure as stipulated in the Partnership Act
A businessman bought a new typewriter for $6 000. He paid $4 000 in cash and traded in his old typewriter. What is the entry to record this transaction?
Dr. new typewriter $6 000 Cr. old typewriter $2 000 Cr. cash $4 000
Dr. old typewriter $2 000 Dr. cash $4 000 Cr. new typewriter $6 000
Dr. new typewriter $4 000 Dr. cash $2 000 Cr. old typewriter $6 000
Dr. old typewriter $6 000 Dr. cash $4 000 Cr. new typewriter $2 000
What are the TWO most frequently used methods of calculating provision for depreciation?
Revaluation and Straight Line Methods
Depletion Unit and Reducing Balance Methods
Machine Hour and Revaluation Methods
Straight Line and Reducing Balance Methods
The excess of the income over the expenditure of a non-profit-making organization is called
gross profit
net profit
accumulated fund
surplus
Patrick is to join Dennis and Tony in partnership. Patrick brings to the partnership as capital, furniture valued at $3 000 and a motor van worth $5 000. In addition, he is to pay a premium of $1 000 to be shared between Dennis and Tony. How much would be the amount of Patrick's capital?
$4 000
$6 000
$8 000
$9 000
Which of the following states the correct order of the stages in the accounting cycle?
Journalizing, Posting to Ledger, Trial Balance, Final Accounts
Journalizing, Trial Balance, Posting to Ledger, Final Accounts
Posting to Ledger, Journalizing, Trial Balance, Final Accounts
Posting to Ledger, Trial Balance, Journalizing, Final Accounts
Which of the following is entered in the Purchases Account of a grocery?
Goods for sale.
Duplicating machines
Typewriters
Office stationery
A trader draws up a Trial Balance in order to
ascertain the need for a suspense account
check for errors in the balance sheet
ascertain the total amounts owing to him and by him
test the arithmetic accuracy of double-entry postings
In which book would a trader enter the writing-off of a debt of a bankrupt customer?
Sales Journal
General Journal
Returns Journal
Purchases Journal
Which of the following would NOT be considered part of the prime cost of manufactured goods?
Office manager's wages
Machine operator's wages
Raw materials used
Freight on raw material
Credit notes issued for goods returned by customer will be entered firstly in the
Returns outward book
Returns inward book
Sales returns and allowances account
Purchases returns and allowances account
A standing order of $25 for insurance appears in the debit column of the Bank Statement. This amount does not appear in the Cash Book. How is this item treated in order to up date the Cash Book?
Subtract the $25 from the Bank Statement Balance.
Add $25 to the Bank Statement Balance.
Credit the Bank Account with $25.
Debit the Bank Account with $25.
A Suspense Account was opened for an error of $30 found in the trial balance. Later it was observed that sales were understated by $30. This item would be corrected in the journal by
Dr. Trading, Cr. Suspense
Dr. Suspense, Cr. Goods
Dr. Sales, Cr. Suspense
Dr. Suspense, Cr. Sales
Goods were purchased from M. Smith on credit for $2 400 but posted to N. Smith's Account. The item would be corrected in the journal as follows
Dr. M. Smith $2 400, Cr. Purchases $2 400
Dr. M. Smith $2 400, Cr. N. Smith $2 400
Dr. Purchases $2 400, Cr. M. Smith $2 400
Dr. N. Smith $2 400, Cr. M. Smith $2 400
What is Z's share of a profit of $7 200?
$ 800
$1 200
$1 800
$2 400
How should the totals of the Discount Allowed and Discount Received columns be posted when the Cash Book is ruled off?
Debit Discount Allowed, Credit Discount Received
Debit Discount Allowed, Credit Cash
Debit Discount Received, Credit Discount Allowed
Credit Discount Received, Debit Cash
At the start of the financial year, a trader has creditors of $3 200. He paid cash of $14 900 to them during the year, and at the end of the year, the balance of his debt was $2 800. What was the trader's total credit purchases for the year?
$12 100
$14 500
$15 300
$17 700
Which of the following is a Book of Original Entry and is also part of the General Ledger?
Cash Book
Journal
Sales Day Book
Purchases Day Book
Item 27 refers to the following information.
Opening stock of raw materials $ 500 Purchases 2 000 Closing stock of raw materials 1 000 Direct labour 3 000 Factory overheads 4 500 Opening stock of work in progress 2 000 Closing stock of work in progress 3 000
From the above information, the cost of goods manufactured is
$ 7 000
$ 8 000
$ 9 000
$11 000
P. Hawk has a manufacturing business. His raw materials cost $1 900. Rates and rent total $2 000, and factory wages amount to $2 500.
The number of units produced is 640. What is the cost of one unit?
$4
$6
$10
$13
Which of the following transactions should be debited in the Cash Account?
Bought goods for cash from J. Jones
Paid office cleaner cash
Sold goods for cash
Paid on loan account
A proprietor withdraws cash from his business for his own use. The entries are
Dr. Cash A/c; Cr. Bank A/c.
Dr. Cash A/c; Cr. Drawings A/c.
Dr. Drawings A/c; Cr. Cash A/c.
Dr. Bank A/c; Cr. Cash A/c.
A and B had a partnership and shared profits and losses and respectively. They admitted C to the partnership. In addition to capital, C had to pay, for Goodwill, $3 600. How much did A and B receive as their respective share of Goodwill?
A receives $1 200, B receives $2 400.
A receives $2 400, B receives $1 200.
A receives $1 800, B receives $3 600.
A receives $3 600, B receives $3 600.
The maximum capital a company can issue to the public is called
authorised capital
issued capital
subscribed capital
paid up capital
What is the cost of raw materials consumed?
$7 950
$8 700
$11 750
$33 000
A company purchased $1 500 worth of paint and was told that if the amount was paid within ten days, it would only have to pay $1 350. In other words it received a
10% cash discount
10% trade discount
15% mark down
15% quantity discount
When a company declares a dividend of 15%, the dividend warrant sent to the shareholder owning 1 500 $1 ordinary shares is
$100
$225
$1 500
$1 515
Which of the following accounts shows how profits and losses are shared among partners?
Profit and Loss Account
Appropriation Account
Current Account
Income and Expenditure Account
On January 1, a firm's capital is $4 600. On December 31, of the same year, the following information was provided: Drawings $850, Total assets $10 000, Loan outstanding $950, Creditors $4 000. What was the net profit that year?
$450
$1 300
$1 400
$1 700
Which of the following is NOT a nominal account?
Carriage inwards
Commission
Furniture
Discount allowed
In preparing the accounts of a club, the account which is used to record expenses and income is called the
Revaluation Account
Income and Expenditure Account
Appropriation Account
Manufacturing Account
What is the cost of purchases entered in the Ledger?
$360
$390
$410
$440
A club treasurer found, on closing his books, that $50 subscription had been paid in advance. Where would this amount appear?
On the debit side of the Income & Expenditure Account
On the credit side of the Income & Expenditure Account
Among the Liabilities on the Balance Sheet
Among the assets on the Balance Sheet
Joanne Barnett is a dressmaker. She bought 100 metres of material from S. Wright for $100 cash. Which of the following is the correct double entry for this transaction in Barnett's ledger?
Dr. Materials A/c; Cr. S. Wright's A/c.
Dr. Materials A/c; Cr. Cash A/c.
Dr. Cash A/c; Cr. S. Wright's A/c.
Dr. Cash A/c; Cr. Materials A/c.
A retailer purchases goods worth $3 000. He receives 30% trade discount and 5% cash discount. What did he pay?
$1 995
$2 095
$2 100
$2 850
The total assets of a business were $9 000 and the total liabilities $3 000. A vendor offered $10 000 for the business. What amount was given for goodwill?
$ 1 000
$ 2 000
$ 4 000
$16 000
Which of the following are NOT cash transactions? I. Bought goods paying by cheque II. Sold goods receiving payment on delivery III. Paid balance owed to M. Merchan- danny IV. Sold motor lorry on two years terms
I and III only
II and III only
II and IV only
II, III and IV only
A plant valued at $4 000 is depreciated at 10% per annum using the diminishing balance method. What is its value after TWO years?
$3 200
$3 240
$3 920
$3 980
The balances of the asset accounts of the Bayroe Club as at June 30, 1994 were:
The amount of his accumulated fund was
$1 640
$4 497
$8 185
$9 897
What conclusions could be drawn from the above Appropriation Account? I. The company has recently come into existence. II. The company is engaged in profitable enterprise. III. The company is not doing too well. IV. More dividends can be given to the ordinary share holders.
II and IV only
III and IV only
I, II and IV only
I, III and IV only
A businessman incurred the following expenses: Factory repairs $6 000 Machinery repairs $2 000 New machine $3 000 New vehicle $7 000 What was the total capital expenditure?
$ 6 000
$ 7 000
$ 8 000
$10 000
To record a credit sale to S. John, which of the following entries must be made? I. Debit Sales Account II. Credit Sales Account III. Debit S. John's Account IV. Credit S. John's Account
I and II only
I and IV only
II and III only
II and IV only
What is the productive cost of goods manufactured?
$29 000
$30 000
$39 000
$40 000
Prime Cost is $79 110 and overheads is $4 720. What is the cost of production?
$4 720
$74 390
$79 110
$83 830
B. Black purchased goods for $400 and received 10% discount. Later he returned goods worth $100, because they were faulty. How much did he receive for the goods returned?
$ 10
$ 40
$ 90
$1 000
The net profit of a firm was shown as $1 600 and it was later discovered that discounts received were under-cast by $10 and purchases were understated by $36. The corrected net profit was
$1 574
$1 610
$1 636
$1 646
Closing stock at year end was NOT calculated correctly. Which of the following will be affected? I. Cost of sales II. Gross profit III. Net purchases IV. Working capital
I and II only
III and IV only
I, II and IV only
II, III and IV only
What is the working capital of Sherida's Ltd?
$2 000
$2 400
$3 600
$3 800
What is the Current Ratio of Sherida's Ltd?
1 : 1
1.5 : 1
2.1 : 1
3.1 : 1
A credit balance b/f in the Sales Ledger Control A/c represents an overpayment
to creditors
by debtors
to debtors
by creditors
Which of the following is the correct entry when a debtor is UNLIKELY to pay off his debt?
Dr. Debtors A/c, Cr. Bad Debts A/c.
Dr. Debtors A/c, Cr. Provision for Bad Debts A/c.
Dr. Bad Debts A/c, Cr. Debtors A/c.
Dr. Profit & Loss A/c, Cr. Provision for Bad Debts A/c.
A Suspense Account showed a debit balance. Which of the following could have given rise to such a balance?
The discount received was overcast in the Cash Book.
The figure taken from an invoice is incorrect, but the postings are correct.
The book-keeper could not find a sales invoice.
Cash received had been credited twice to the Debtor's Account