CSEC Principles of Accounts Paper 2 May/June 2015 - Free CXC Past Paper with Answers

State TWO distinguishing features of a partnership.

Barney and Swiper are in partnership. Their Current Account balances as at 31 March 2015 before appropriation were:

Current Accounts Barney $2 500 Swiper $(600)

State the significance of the brought down balance on EACH partner's current account.

Other balances extracted from the books of Barney and Swiper include:

Capital Accounts Barney $60 000 Swiper $35 000

Drawings Barney (01 October 2014 to 31 March 2015) $4 000 Swiper (01 January 2015 to 31 March 2015) $12 000

Additional information:

• The net income for the year ended 31 March 2015 is $82 000.
• Barney earns an annual salary of $36 000.
• Interest on capital is to be paid at the rate of 5% per annum.
• Interest on drawings is to be charged at the rate of 10% per year.
• Barney and Swiper share profits and losses in the ratio of 3:2 respectively.

Prepare the Profit and Loss Appropriation Account of Barney and Swiper for the year ended 31 March 2015 in the space provided on page 9.

Prepare the partners' Current Accounts on 31 March 2015, after the appropriation.

Using the information provided, prepare an Income Statement for the year ended 31 December 2014. Show clearly the amounts for EACH of the following in the space provided on page 13. (i) Cost of goods sold (ii) Insurance expense (iii) Miscellaneous expenses

Prepare a list showing EACH of the following amounts as at 31 December 2014. (Marks will be awarded for showing clearly how you arrived at the dollar amount.)

Total non-current (fixed) assets

Total current assets

Total current liabilities

Name and use an appropriate ratio to decide whether Series Lann should or should not be given the bank loan. (Show your calculation and give your reason.)

State ONE advantage and ONE disadvantage of using a computer system to maintain accounts.

Prepare the updated Cash Book to show the adjusted balance.

Starting with the updated cash book balance, draw up a Bank Reconciliation Statement for Orvie Elwin for the month of October 2014.

The accounting department of Cav Crafts provided the following information from its various books.

Using the information on page 20 prepare EACH of the following accounts for the year ended 31 August 2014:

Accounts Receivable Control Account

Accounts Payable Control Account

Sedeno Knitted Goods sold 100% of its completed goods during the year ended 30 November 2014. The following additional information is provided.

For the year ended 30 November 2014, prepare EACH of the following accounts for Sedeno Knitted Goods: (i) A manufacturing account showing clearly the total cost of production (ii) A trading account

Record the above transactions in the correctly labelled day books provided below and on page 19. (Include folio references.)

Total EACH day book at the end of the period. (Narratives required.)

Complete the worksheet below to calculate EACH of the following:

• Subscriptions outstanding at 01 January 2014 and at 31 December 2014
• Subscriptions in advance at 01 January 2014 and at 31 December 2014

The PPP party lists the following transactions for the period ended 31 December 2014. On the form provided below, classify EACH item as follows:

Write either capital or revenue in the Expenditure Type column, to indicate the type of expenditure involved for EACH item.

Insert a check mark ($\checkmark$) in the appropriate column to indicate whether the item is to be reported in the Income & Expenditure Account or in the Balance Sheet.

The first item has been done for you as an example.

CLASSIFICATION OF EXPENDITURE

Prepare the Receipts and Payments Account of the PPP party for the period ended 31 December 2014, using relevant information from (a) (ii) and (b) on pages 27 and 28.

The Vegi Lands Farmers' Co-operative provides the following information about its operations for the year ended 31 December 2014:

• Share capital of $500 000 was originally sold to members at $5 each.
• Surplus for the year totalled $65 000 and was earned from the total sales of $350 000.
• Undistributed surplus from previous years amounted to $125 000.

The co-operative plans to share its total surplus as follows:

• Dividends of $0.50 per share to be paid to existing shareholders
• 20% to be transferred to the Members' Educational Fund
• 5% of total sales to be paid to members as patronage refunds
• 30% to be transferred to a Disaster Relief Fund

Prepare the co-operative Appropriation Account for the year ended 31 December 2014. (Show working clearly).

A sister co-operative, Flat Lands Cane Farmers Co-operative, presented the following balances for its financial year ended 31 December 2014:

Prepare the Co-operative Balance Sheet Extract for the capital section only, for the year ended 31 December 2014.

Identify and total EACH of the following amounts for Flat Lands Cane Farmers’ Co-operative: a) Non-current (fixed) assets b) Current assets