Free CXC Principles of Accounts Paper 1 May/June 2015 past paper from 2015. 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 2015 - Free CXC Past Paper with Answers
Free CXC Principles of Accounts Paper 1 May/June 2015 past paper from 2015. Includes a worked answer key. Open the PDF, take a timed test, and study with AI on Caribbean AI.
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The MAIN purpose of preparing financial statements is to
determine gross profit
make informed financial decisions
meet the objectives of the business
determine whether capital has increased
A non-trading organization is MAINLY concerned with
importing goods for resale
trading only with wholesalers
providing various services for its members
making maximum profit for the proprietor
Which of the following states the correct order of the stages in the accounting cycle, before Final Accounts?
Posting to ledger, journalizing, trial balance
Posting to ledger, trial balance, journalizing
Journalizing, trial balance, posting to ledger
Journalizing, posting to ledger, trial balance
The balance of an Accounts Payable's Account is entered in the balance sheet under the heading
capital
fixed assets
current assets
current liabilities
A business receives $5 000 for rent and deposits this amount into its bank account. How will this transaction be recorded?
Dr bank $5 000; Cr rent $5 000
Dr rent $5 000; Cr bank $5 000
Dr cash $5 000; Cr rent $5 000
Dr rent $5 000; Cr expense $5 000
Items 6-7 refer to the following Balance Sheet. Balance Sheet of Boots' Sports Store as at 31 December 2012 $ $ Capital 12 000 Land & building 9000 Add Net profit 4.000 Motor van 5000 16 000 Fixtures & fittings 600 Less Drawings (500) Inventory 450 Debtors 250 Creditors Bank 2000 15 500 Cash 300 2 100 17 600 17 600
What is the amount of total fixed assets?
$ 9000
$14000
$14 600
$15 050
What is the amount for total current assets?
$2 550
$3 000
$3 600
$8 600
Which of the following lists of current assets is arranged in order of liquidity?
Accounts receivable, prepayments, inventory, cash, bank
Prepayments, accounts receivable, cash, bank, inventory
Cash, bank, prepayments, accounts receivable, inventory
Inventory, accounts receivable, prepayments, bank, cash
A trader received an invoice for $4 000 less 25% trade discount. Subsequently, he returned one-eighth of the goods. What amount would be entered in his Returns Outwards Account?
$375
$400
$450
$500
Which of the following would NOT appear in a Cash Book?
Goods sold for cheque
Payment for goods
Goods bought for cash
Goods sold on credit
A businessman offers a discount for prompt payment for goods purchased. Under which column in his Three-Column Cash Book, would this be entered?
Bank
Cash
Discount allowed
Discount received
Credit notes issued for goods returned by a customer will be entered firstly in the
returns inward book
returns outward book
sales returns and allowances account
purchases returns and allowances account
An article is subject to a 20% trade discount. Its list price is $600. What is its sale price?
$120
$480
$580
$720
The total credit of the bank column of a Three-Column Cash Book is greater than the total debit. The MOST likely reason for this situation is that
there was an overdraft
transactions were omitted from the debit side
some figures were overstated on the credit side
the incorrect transactions were entered on the credit side
Money spent by a company on the purchase or improvement of a fixed asset is referred to as
liabilities
purchases
capital expenditure
revenue expenditure
Which of the following BEST describes the 'double entry' system of accounting?
A ledger account must have two sides.
An account must be written twice in the ledger.
Each transaction must be written in two subsidiary books.
Each transaction must have a debit entry and a credit entry.
What is the total capital expenditure?
$ 6 000
$ 7 000
$ 8 000
$10 000
Mr Abel and Mr Blue purchased goods on credit from Mr Kane valued at $50 and $75 respectively. Another customer paid cash for goods amounting to $550. Mr Kane took goods at cost for himself amounting to $500. Which of the following figures represents the total in Mr Kane's Sales Account?
$ 125
$ 425
$ 675
$1 175
A proprietor wins a motor vehicle valued at $10 000 and decides to put it into the business. Which of the following entries should be recorded?
Dr motor vehicles account Cr drawings account
Dr capital account Cr motor vehicles account
Dr motor vehicles account Cr capital account
Dr bank account Cr capital account
The Trial Balance is prepared by using balances from the
Ledger
Journal
Sales book
Purchases book
K. Khan, a debtor of A and B Enterprises, settles his debt of $120 less 2½% discount, by cheque. How should the double entry be recorded in the books of A and B Enterprises?
Dr K. Khan $117 Dr discount received $ 3 Cr bank $120
Dr K. Khan $117 Dr discount allowed $ 3 Cr bank $120
Dr bank $117 Dr discount allowed $ 3 Cr K. Khan $120
Dr bank $117 Cr discount received $ 3 Cr K. Khan $120
What is the amount of the 'cost of sales'?
$2 600
$6 100
$7 700
$8 800
Item 23 refers to the following information.
A calculation to determine gross profit percentage is as follows:
What does the $529 800 represent?
Total purchases
Cost of sales
Total sales
Gross profit
Item 24 refers to the following data which are taken from the records of a hardware store at the end of its fiscal year.
$
Sales 83 868 Sales returns 1 570 Discount allowed 911 Inventory at start 9 850 Inventory at close 11 075 Purchases 52 640 Purchases returns 762
What is the gross profit of the hardware store?
$25 625
$31 645
$33 215
$34 023
The working capital of A. Young and Sons is $15 500. The total amount of current assets is $16 500. What is the total amount of current liabilities?
$ 1 000
$15 500
$16 500
$32 000
A company has a current ratio of 3:1. Current liabilities are Creditors $10 000 Accruals $ 5 000
What is the the working capital amount?
$15 000
$30 000
$45 000
$60 000
Item 27 refers to the following balances taken from the books of Sherida's Ltd on 30 April 2012.
BALANCES $ Rent owing $ 200 Cash $3 500 Creditors $1 200 Prepaid insurance $ 300 Bank overdraft $ 400
What is the working capital of Sherida's Ltd?
$2 000
$2 400
$3 600
$3 800
On 01 January 2012; $10 000 was paid towards an advertising campaign. Of this amount, $7 000 was used by 31 December 2012.
What was the amount of advertising prepaid at year's end?
$ 3000
$ 7000
$10 000
$17 000
Depreciation in accounting terms can be defined as the
increase in value of an asset over time
money saved to replace a fixed asset
cost of using a fixed asset for an accounting period
straight line method or reducing balance method used by a business
The annual rent of a business is $6000. The business paid $5000 during the present year and recorded $5000 in its income statement. Which accounting concept was breached?
Separate entity
Consistency
Prudence
Accrual
How does an increase in bad debts affect a sole trader's financial statements?
Increases the net profit
Decreases the gross profit
Increases the gross profit
Decreases the net profit
Control accounts are kept in order to assist management in
limiting expenditure
limiting drawings
increasing profits
locating errors
Item 33 refers to the following information. On 31 January, the cash book and a bank statement of a business revealed the following.
| $ | |
|---|---|
| Unpresented cheques | 350 |
| Cash book balance on 31 January | 680 |
| Bank charges not yet entered in cash book | 25 |
| Deposits not credited on bank statements for the period ending 31 January | 210 |
The balance on the bank statement will be
$745
$795
$820
$845
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 update the cash book?
Credit the bank account with $25.
Debit the bank account with $25.
Add $25 to the bank statement balance.
Subtract $25 from the bank statement balance.
What is Kay's credit sales for the month of May?
$ 6 800
$ 8 800
$11 800
$14 800
Which of the following can be determined from an Opening Statement of Affairs?
Sales
Capital
Expenses
Purchases
What is the inventory at the end of January?
$ 300
$ 500
$ 700
$1 300
What sum of money is represented by (I)?
$1 000
$2 000
$3 000
$6 000
Mr Miguel's capital on 01 January was $40 000 and on 31 December $85 000. He withdrew $1 000 in inventory during the year.
What is his profit for the year?
$ 5 000
$ 46 000
$125 000
$126 000
According to the terms of a Partnership Agreement, partner A is to be credited with a salary of $5 000 per year. How will this will be recorded in the books?
Dr partner's current account, Cr cash
Dr partner's current account Cr appropriation account
Dr appropriation account, Cr partner's current account
Dr appropriation account, Cr cash
Tom, Percy and John formed a partnership and agreed that profits were to be shared in the ratio 1:1:2 respectively. The net profit for the year was $18 900. What was John's share of the profit?
$ 4 725
$ 9 450
$14 175
$18 900
The total capital in a partnership is $30 000. Rose contributed $7 000 in cash and a motor vehicle worth $3 000. Rose's contribution to the partnership would be recorded in the journal as
Cash Rose's capital $ 10 000 $ 10 000
Rose's capital Cash 7 000 7 000
Cash Motor vehicle Rose's capital 7 000 3 000 10 000
Rose's capital Motor vehicle Cash 10 000 3 000 7 000
Item 43 refers to the following table which shows the amount of capital invested by four persons in a partnership.
The partners share profit and loss in the proportion of their capital. What is Z's share of the profit of $7 200?
$ 800
$1 200
$1 800
$2 400
Mrs Allen invested $20 000, Mrs Brown invested $5 000 and Mr Cable invested $5 000 in the same business. The loss sustained during the year was $1 000. The Partnership Agreement is silent on the item of losses, although profits are to be split in the ratio 2:2:1 in favour of Allen, Brown and Cable respectively. How much of the loss must be borne by Mr Cable?
$200
$240
$300
$400
A company earned a net profit of $60 000 for the year ending 30 September 2014. Proposed dividend were: ordinary shares $10 000 and preference shares $15 000. The company decided to transfer $8 000 to a general reserve. The retained earnings on 30 September 2014 were
$27 000
$33 000
$35 000
$93 000
SK Ltd was given permission to offer for sale 10 000 six per cent (6%) preference shares at $5 each and 20 000 ordinary shares at $3 each. All of the preference shares and three-quarters of the ordinary shares were fully paid up. What was the amount of the authorized share capital?
$ 30 000
$ 82 500
$ 95 000
$110 000
The issue was fully subscribed. How much capital did the company raise?
$ 40 000
$ 45 000
$400 000
$450 000
When a company declares a dividend of 15%, the dividend warrant sent to the shareholder who owns 1 500 one-dollar ordinary shares is
$ 100
$ 225
$1 500
$1 515
If the members of a business organization form its management and credit committees, the entity (or organization) can best be described as a
sole trader
partnership
corporation
co-operative
What conclusions could be drawn from the above Appropriation Account? I. The company is engaged in profitable enterprise. II. The company is not doing too well. III. More dividends can be given to the ordinary shareholders.
I only
II only
I and III only
II and III only
Item 51 refers to the following summary of receipts and payments for a club at 01 March. Subscriptions received $300 Rent paid $ 60 Purchase of games and equipment $150 Postage of circulars $ 20 Proceeds from book sale $250
What is the cash balance at 31 March?
$180
$280
$320
$620
The Income and Expenditure Account shows the
expenditure incurred and liabilities owed for the period
income earned and expenditure incurred for the period
income earned and assets owned for the period
assests owned and liabilities owed for the period
The amount of its accumulated fund was
$1 640
$4 497
$8 185
$9 897
Which of the following BEST describes (I) and (II) shown in the table?
(I) Profit & loss account (II) Rent received
(I) Trading account (II) Subscription received
(I) Profit & loss account (II) Subscription received
(I) Income & expenditure account (II) Subscription received
P. Hawk has a manufacturing business. The cost of his raw materials is $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
Item 56 refers to the following information.
J. Baynes Manufacturing Account for period ending 31 December 2014 Inventory of raw materials 01 January 2014 Purchases of raw materials during year Less closing inventory of raw materials 31 December 2014 Productive wages Fuel and power Lubricants Rent and rates 800 4500 5300 1400 3900 1300 900 100 400 200 6800 Balance c/d 6800
What is the cost of raw materials consumed?
$800
$1 200
$3 900
$4 500
The items, raw materials inventory, work in progress inventory and finished goods inventory are MOST likely seen together on the balance sheet of a
garage
shoe factory
supermarket
bus company
S & B Limited's net income for the year was $89 000. Of this amount, $8 000 was transferred to general reserve, preference dividend paid was $2 400 and ordinary dividend proposed was $6 500. The value of the retained profits for the year was
$72 100
$80 100
$81 000
$89 000
P. Amos is paid at the rate of $7 per hour for a basic 40 hour week. During the week of 06 April 2012, he worked a basic week of 40 hours. The income tax due on his pay is $20, and social security contribution is 5% of his gross pay. What is his net pay?
$246
$260
$266
$280
Which of the following are considered to be statutory deductions, when preparing employees' earnings records?
I. Mortgage II. Income tax III. National insurance
I and II only
I and III only
II and III only
I, II and III