Free CXC Principles of Accounts Paper 1 May/June 2020 past paper from 2020. 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 2020 - Free CXC Past Paper with Answers
Free CXC Principles of Accounts Paper 1 May/June 2020 past paper from 2020. Includes a worked answer key. Open the PDF, take a timed test, and study with AI on Caribbean AI.
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A non-trading organization is MAINLY concerned with
importing goods for resale
trading only with wholesalers
making maximum profit for the proprietor
providing various services for its members
The term 'accounting' refers to
using information to make business decisions
using special ways to record business information
recording, analysing and interpreting of business information
journalizing, posting and balancing of accounts in special books
Rent expense which is still owing at the end of the period must be debited in the Profit and Loss Account and shown in the balance sheet as a liability. Which accounting concept does this represent?
Accrual
Consistency
Going concern
Money measurement
During the year, a company bought stationery for $220 and used $120 worth of it. What figure would be posted to the Profit and Loss Account to represent the expenditure for stationery?
$100
$120
$220
$340
Item 5 refers to the following balances at the end of a financial period.
Motor vehicle Payables Receivables Capital Building $ 2 000 3 000 2 000 11 000 10 000
What is the TOTAL amount for the assets?
$12 000
$13 000
$14 000
$15 000
Which of the following lists of current assets is arranged in order of liquidity?
Accounts receivable, prepayments, inventory, cash, bank
Cash, bank, prepayments, accounts receivable, inventory
Prepayments, accounts receivable, cash, bank, inventory
Inventory, accounts receivable, prepayments, bank, cash
The summarized position of Foster and Scott Limited at 6 March 2015 was
Current liabilities Current assets Non-current assets Non-current liabilities $ 60 000 100 000 200 000 150 000
What was the capital of Foster and Scott Limited at 6 March 2015?
$ 40 000
$ 90 000
$150 000
$190 000
Item 8 refers to the following information. A calculation to determine gross profit percentage is as follows. $185 530 100 X = 35.02% $529 800 1
What does the figure $529 800 represent?
Total sales
Gross profit
Cost of sales
Total purchases
The following assets were found on the Statement of Financial Position of a retailer. What would be the BEST order, if these assets were arranged in order of permanence?
Building, motor van, bank, fixtures, cash, receivables
Cash, fixtures, receivables, bank, building, motor van
Cash, bank, fixtures, receivables, motor van, building
Building, motor van, fixtures, receivables, bank, cash
Which of the following items would NOT appear in a cash book?
Payment for goods
Goods sold on credit
Goods bought for cash
Goods sold for cheque
In a cooperative society, the daily affairs are administered by
a majority of shareholders
all members meeting together
the chairman of the board only
persons elected or appointed to do so
Credit notes issued for goods returned by a customer would be entered firstly in the
returns inward book
returns outward book
sales returns and allowances account
purchases returns and allowances account
Ms Hoyte, a grocer, bought a computer on credit from Tan Company. In Ms Hoyte's books, which of the following journal entries would be made for this transaction?
Dr purchases account Cr Tan Company
Dr computer account Cr cash
Dr Tan Company Cr purchases account
Dr computer account Cr Tan Company .
The acid test ratio indicates
net current assets less inventory available to pay current liabilities
current assets to pay current liabilities
non-current assets to be sold to pay current liabilities
overdraft that the trader could secure to pay his current liabilities
Which of the following accounts is NOT nominal?
Furniture
Commission
Carriage inwards
Discount allowed
Which of the following accounts are usually transferred to the trading, and profit and loss account?
Rent, premises, drawings
Drawings, rent, purchases
Commission received, rent, purchases
Purchases, furniture, commission received
Which of the following items is a capital expenditure?
Wages
Repairs
Purchase of goods
Purchase of machinery
In order to avoid writing numerous cheques for small amounts, a firm may set up a
bank draft
petty cash fund
general journal
bank standing order
Mrs Abel and Mrs Blue purchased goods on credit valued at $50 and $75 respectively from Mr Kane. Another customer paid Mr Kane 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
Mr Ram, a shoemaker, bought a motor van for $11 000 cash. In recording this transaction he should
Cr cash; Dr motor van account
Dr cash; Cr motor van account
Cr cash; Dr purchases account
Dr cash; Cr purchases account
In Mrs Lowe's ledger, an entry on the debit side of the drawings account and an entry on the credit side of the bank account means that
Mrs Lowe puts money in the business' bank account
the bank puts money into Mrs Lowe's personal account
Mrs Lowe withdraws money from the bank for use in the business
Mrs Lowe uses money from her business' bank account for her personal use
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
The formula for calculating working capital is
non-current less current assets
total assets less total liabilities
non-current less current liabilities
current assets less current liabilities
Item 24 refers to the following Statement of Financial Position. Statement of Financial Position of Boots' Sports Store as at 31 December 2019 $ $ Land and building 9 000 Capital 12 000 Motor van 5 000 Add net profit 4 000 Fixtures and fittings 600' 16 000 Inventory 450 Less drawings (500) Debtors 250 15 500 Bank 2000 Payables 2 100 Cash 300 17 600 17 600
What is the TOTAL amount for non-current assets?
$ 9 000
$14 000
$14 600
$15 050
Item 25 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
What is the net profit percentage (to the nearest whole number)?
10%
17%
23%
37%
The current ratio of the business (rounded to 2 decimal places) is
1.45 : 1
1.64 : 1
2.57 : 1
3.14 : 1
On 1 January 2016, $10 000 was paid towards an advertising campaign. Of this amount, $7 000 was used by 31 December 2016.
What was the amount of advertising prepaid at year's end?
$ 3 000
$ 7 000
$10 000
$17 000
Depreciation in accounting terms can be defined as the
money saved to replace a fixed asset
increase in value of an asset over time
cost of using a fixed asset for an accounting period
straight line method or reducing balance method used by a business
To which of the following accounts would depreciation of office machines be transferred?
Trading
Appropriation
Manufacturing
Profit and loss
The working capital of P. Young and Sons is $15 500, and current assets is $16 500. What is the TOTAL current liabilities?
$ 1 000
$15 500
$16 500
$32 000
Item 32 refers to the following balances taken from the books of Sherida's Ltd on 30 April 2020.
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
$2 600
$2 800
Item 33 refers to the following information about the operation of a firm.
Provision for doubtful debts on 1 January Receivables on 1 January Receivables on 31 December
$ 700 $30 000 $25 000
The provision for doubtful debts is calculated at a rate of 2% of receivables.
What amount would be charged for the provision for doubtful debts for the year ended 31 December?
$200
$500
$600
$700
How does an increase in bad debt affect a sole trader's financial statements?
Decreases the gross profit
Increases the gross profit
Decreases the net profit
Increases the net profit
A company's rent account had an opening debit balance of $2 000. During the year $6 000 was paid for rent. At the end of the year there was a closing debit balance of $1 500 in the account.
What was the rent expense recorded for the year?
$ 6 000
$ 6 500
$7500
$ 9 500
M. Brown wishes to increase her provision for doubtful debts from 8% to 10%. Accounts receivable at the end of the year totalled $10 000, whilst the balance in the provision for bad debts account is presently $800. Which of the following entries would be correct to record the provision for the year?
Dr Profit & Loss A/c Cr Provision for Doubtful Debts A/c
Dr Profit & Loss A/c Cr Provision for Doubtful Debts A/c
Dr Profit & Loss A/c Cr Profit & Loss A/c
Dr Profit & Loss A/c Cr Provision for Doubtful Debts A/c
The balances of the asset accounts of the Bayroe Club as at 30 June 2019 were:
The amount of its accumulated fund was
$1 640
$4 497
$8 185
$9 897
A. Jones by mistake debited C. Hall's A/c instead of F. Hall. Which of the following corrects the mistake?
Dr. F. Hall Cr. Suspense A/c
Dr. C. Hall Cr. Suspense A/c
Dr. F. Hall Cr. C. Hall A/c
Dr. Suspense A/c Cr. F. Hall A/c
Items 39-40 refer to the following Statement of Financial Position provided for a firm as at 1 January 2019. $ $ Bank 3 000 Payables 500 Receivables I II 5 500 Inventory 1000
What sum of money is represented by I?
$1 000
$2 000
$3 000
$6 000
Which of the following accounts is represented by II?
Loan
Cash
Capital
Liability
Item 41 refers to the following information relating to Harvard Sports Club for 2019. Number of members 50 Annual subscriptions $ 50 Subscriptions owing at the beginning of the year $450 Subscriptions owing at the end of the year $150
How much was collected in subscriptions during the year?
$2 200
$2 500
$2 800
$3 100
Mr Miguel's capital on 1 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
What would be Z's share of a profit of $7 200?
$2 400
$1 800
$1 200
$ 800
Which of the following accounts shows how profits and losses are shared among partners?
Current
Appropriation
Profit and loss
Income and expenditure
What is the closing capital of the business?
$25 500
$28 500
$31 500
$33 000
Which of the following features is associated with private limited companies?
They are family owned.
Shares are not sold publicly.
Financial statements are published.
Government agencies purchase shares.
Capital at the start of a trading period was $20 000, and at the end of the period it was $22 500. The net profit for the period was $6 500. How much money was withdrawn for the period?
$2 500
$4 000
$6 000
$9 000
According to the Partnership Act, if there is no Deed of Partnership, the amount of profit to be received by EACH partner would be
in equal share
5% of net profit
5% on capital invested
in proportion to capital invested
Item 49 refers to the following information.
Inventory at 1 January 2019 Purchases during the month Cost of goods sold $ 1 500 1 200 1 400
What is the inventory at the end of January?
$ 300
$ 500
$ 700
$1 300
Which of the following items is NOT recorded in the Appropriation Account of a partnership?
Interest on capital
Share of profits
Drawings
Salaries
When a company declares a dividend of 15%, the dividend warrant of a shareholder owning 1500 one-dollar ordinary shares is
$ 100
$ 225
$1 500
$1 515
Item 52 refers to the following information. Jane and Mary are in partnership sharing profits in the ratio 3:2. The following balances are taken from their books.
Net Profit $23 500 Interest on Capital: Jane $ 2 000 Mary $ 1 000 Salary: Jane $ 2 500 Drawings: Jane $ 500 Mary $ 1500 Interest on Drawings: Jane $ 15 Mary $ 45
How much money should Jane receive as her share of the residual profits?
$ 9 636
$10 836
$10 800
$16 254
P. Amos is employed by a construction company at a rate of $7 per hour. During the week of 6 April, he worked his basic week of 40 hours. The income tax due on his pay is $20, and he is also liable to pay social security contributions of 5% of his gross pay. What is his net pay?
$246
$260
$266
$280
What is the maximum capital a company can raise from selling shares to the public?
Issued capital
Paid up capital
Authorised capital
Subscribed capital
Item 55 refers to the following table of a prospectus issued by a public limited company offering shares for sale at par value.
| Type of Share | No. of Units | Par Value |
|---|---|---|
| Ordinary | 200 000 | $2.00 |
| 5% Preference | 10 000 | $5.00 |
If the issue was fully subscribed, how much capital did the company raise?
$ 40 000
$ 45 000
$400 000
$450 000
Which of the following will result when opening inventories of raw materials are added to net purchases of raw materials?
Prime cost
Production cost
Raw materials used
Raw materials available for use
Item 57 refers to the following data which pertain to Tarisha Ali, an employee of a bank.
Monthly salary $3 500 Overtime $ 800
Income tax rate: 25% on every dollar above $2 000 of monthly salary 30% on overtime earned
The TOTAL income tax to be deducted from Tarisha Ali is
$ 615
$ 740
$ 875
$1 075
Which of the following items is NOT considered a source document for payroll?
Clock card
Medical certificate
Attendance register
Electronic timecard
Item 59 refers to the following information provided by a business.
Total unpresented cheques $ 120 Lodgement not entered on bank statement 150 Balance per cash book 560
What is the balance per bank statement?
$120
$150
$340
$530
The net profit of a firm was shown as $1 600. It was later discovered that discounts received were undercast by $10 and purchases were understated by $36. What is the correct net profit?
$1 574
$1 610
$1 636
$1 646