Free CXC Principles of Accounts Paper 2 May/June 2013 past paper from 2013. 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 2 May/June 2013 - Free CXC Past Paper with Answers
Free CXC Principles of Accounts Paper 2 May/June 2013 past paper from 2013. Includes a worked answer key. Open the PDF, take a timed test, and study with AI on Caribbean AI.
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Every question from this paper as text. See the answers and worked solutions. Questions are the property of the Caribbean Examinations Council; Caribbean AI is not affiliated with CXC.
ConEct is a retailer of mobile phones. All of its revenue comes from a percentage of the sales value of VeryBerry mobile phones which it delivers to customers’ homes and workplaces. At the end of the financial year, 31 January 2012, the following balances were presented.
| $ | |
|---|---|
| Capital | 88 000 |
| Delivery van at cost | 60 000 |
| Provision for depreciation: Delivery van | 12 000 |
| Bank | 121 400 |
| Sales commissions received | 115 500 |
| Sales commissions outstanding | 14 100 |
| Rent | 13 300 |
| Rent owing | 3 000 |
| Insurance | 7 100 |
| Insurance prepaid | 1 800 |
| Delivery expenses | 11 500 |
| Salesmen’s wages | 46 700 |
| 5-year bank loan | 50 000 |
| Loan interest | 5 500 |
Note: The business calculates annual depreciation expense at a rate of 20% on the reducing balance basis.
Using the information provided, prepare for ConEct:
[20 marks]
An Income Statement for the year ended 31 January 2012
[12 marks]
A classified Balance Sheet as at 31 January 2012
[8 marks]
The table below shows sources of the Debtors’ Ledger Control Accounts.
| Source of Information | Book of Original Entry |
|---|---|
| Total refund to debtors | |
| Total dishonoured cheques | |
| Total credit sales | |
| Total returns inwards | |
| Receipts from debtors | |
| Total discounts allowed | |
| Total bad debts |
Copy the table in your answer booklet and complete it to show the Book of Original Entry for EACH source of information. An example is given.
L. Somerset presented the following information for the month of October 2012:
| $ | |
|---|---|
| Creditors ledger control account credit balance b/d | 25 400 |
| Creditors ledger control account debit balance b/d | 1 450 |
| Returns outwards | 1 200 |
| Purchases for the quarter | 123 900 |
| Payments to creditors | 100 300 |
| Refund by cheque from creditor due to damaged item | 1 180 |
| Discounts received | 2 500 |
| Cheque returned by creditor — presented too late to bank | 3 300 |
| Set off of credit amount between debtors ledger and creditors ledger | 620 |
| Received from creditor due to overpayment | 284 |
[20 marks]
Copy the table in your answer booklet and complete it to show the Book of Original Entry for EACH source of information. An example is given.
[6 marks]
Prepare the Purchases Ledger Control Account for L. Somerset for the month of October 2012.
On 1 November 2012, L. Somerset discovered the following errors in the accounts.
[9 marks]
Use the general journal to correct the TWO errors above. Narrative for EACH journal entry is required.
[5 marks]
The accountant employed by Reisse Holdings provided the owner with the following report for the financial year ended 30 June 2012.
"Reisse Holdings showed a current ratio of 4:1 on its current assets of $60 000. This is a very positive sign because for the year ended 30 June 2011, the ratio was 2:1 on current liabilities of $12 000."
The owner of Reisse Holdings requested additional information on the performance of the business. The accountant presented the following information for the year ended 30 June 2012.
| $ | $ | ||
|---|---|---|---|
| Sales | 250 000 | ||
| Less: Cost of sales | |||
| Opening stock | 6 800 | ||
| Purchases | 116 000 | ||
| Cost of goods available for sale | 122 800 | ||
| Less: Closing stock | (4 400) | ||
| Cost of sales | 118 400 | ||
| Gross Profit | 131 600 | ||
| Less: Expenses | |||
| Rent | 11 520 | ||
| Maintenance and repairs | 1 890 | ||
| Discount allowed | 1 680 | ||
| Wages | 38 500 | ||
| Depreciation expense | 2 570 | ||
| Interest on bank loan at 10% per annum | 5 540 | ||
| (61 700) | |||
| Net Profit | 69 900 |
The following additional information was given:
[20 marks]
Using the formula for current ratio, calculate for Reisse Holdings:
[4 marks]
The current assets as at 30 June 2011
[2 marks]
The current liabilities as at 30 June 2012
[2 marks]
Using the appropriate formulae, calculate for Reisse Holdings:
Show all working clearly.
[6 marks]
Average stock
[2 marks]
Stock turn
[2 marks]
Gross profit percentage
[2 marks]
Prepare a summarized balance sheet for Reisse Holdings as at 30 June 2012. Show all necessary details in the capital section.
[6 marks]
Calculate the return on capital employed for Reisse Holdings for the year ended 30 June 2012.
[2 marks]
Using any of the ratios calculated above, comment on the performance of Reisse Holdings for the year ended 30 June 2012.
[2 marks]
Fashion Forward is a manufacturer of clothing. For the year ended 31 December 2012, the enterprise produced 4 500 dresses. The following relates to the manufacturing operations for the period. Some figures are missing.
Inventory at 1 January 2012
Inventory at 31 December 2012
Purchase of raw material
Returns outwards of raw material
Carriage on raw material $ 3 400
Direct labour (wages)
Salary of factory manager $38 050 Direct expenses $ 8 900 Factory power $ 4 400 General factory expenses $18 050 Annual depreciation on plant and machinery $16 000
[20 marks]
After calculating missing figures, prepare an account or statement for Fashion Forward to show the cost of raw materials consumed.
[8 marks]
After calculating missing figures, prepare a cost of direct labour statement for Fashion Forward for the year ended 31 December 2012.
[4 marks]
Starting with cost of raw materials consumed and direct labour cost calculated in (a) and (b), prepare the Manufacturing Account for the year ended 31 December 2012. Show all working clearly.
[8 marks]
Mark and John are employed by El’s creation. They are paid at $30.00 per hour for a basic 40 hour week. Work done in excess of 40 hours is paid at the rate of time and a half.
[20 marks]
During a given week, Mark worked 27 hours and John worked 46 hours. Calculate the gross pay for
[10 marks]
Mark
[3 marks]
John
[7 marks]
Using your answers from (a) above and the additional information provided in the table above, complete the payroll form which is provided as an insert.
The following additional information relates to the payment of Mark and John.
[8 marks]
State ONE difference between ‘statutory deductions’ and ‘voluntary deductions’.
[2 marks]
Sautee Credit Union has 1500 members. On 1 January 2013, the following are some of the account balances on the books of Sautee Credit Union.
\$
Loans to members (due 2016) 145 000
Interest outstanding on loans to members 2 250
Stock of stationery supplies 4 370
Telephone bill unpaid 1 350
Interest income received in advance 2 010
Long-term investments in other co-operatives 78 900
Net book value of equipment 20 000
Mortgage 90 000
Mortgage interest outstanding 2 000
Bank 42 500
Members welfare fund 60 000
Education fund 30 000
Unappropriated profits 42 860
[20 marks]
Using the information provided, prepare the following for Sautee Credit Union as at 1 January 2013.
[7 marks]
List the items which are considered fixed assets of Sautee Credit Union.
[2 marks]
List the items which are considered current liabilities of Sautee Credit Union.
[2 marks]
Draft the Balance Sheet extract to show the Capital section of the Balance Sheet for Sautee Credit Union as at 1 January 2013.
[3 marks]
The board of directors of Sautee Credit Union decided to raise more capital by advertising for new and old members to purchase shares. They have provided the following information on receipts and payments:
2 January 2013
[13 marks]
Prepare the journal entries to record the sale of shares and the receipt of registration fees.
[7 marks]
Prepare the Bank Account of Sautee Credit Union to record the above receipts and payments. Be sure to include the balance at bank as at 1 January 2013.
[6 marks]
Bacolet Gray owns a small factory which makes items from coconut shells. During her first month of operation, she simply wrote down all of her transactions. Her newly-hired accountant has found the following details of transactions for the month of January 2013.
The factory was started with the following asset and liability:
All purchases of raw materials for the month were made on credit from S. Francis. Three large orders were made as follows:
On 22 January, Bacolet paid S. Francis the total amount owed at that time, by cheque. On 31 January Bacolet issued a cheque for $5 000 to S. Francis on account and was given a discount of 3% of the $5 000.
All sales were made on a credit basis to V. Taylor in three large sales orders as follows:
V. Taylor returned $1 390 worth of goods on 10 January. On 30 January, the amounts owed to Bacolet for sales on 8 January and 16 January minus the returns were paid off by cheque. Bacolet granted V. Taylor a discount of 2% on this payment.
On 31 January, Bacolet recorded the following cheque payments:
[20 marks]
From the above transactions, identify ONE item of revenue expenditure and ONE item of capital expenditure for Bacolet Gray.
[2 marks]
Open the T-accounts in the appropriate ledgers, for EACH of the following: a) S. Francis b) V. Taylor c) Bank
In EACH account opened, record the transactions which affect that account. Balance the accounts at the end of the month.
[18 marks]