CSEC Principles of Accounts Paper 3 May/June 2013 - Free CXC Past Paper with Answers

Explain why Ray's debts to Lawn & Garden Ltd should be recorded as $60 000 current liabilities and $75 000 as long-term liabilities on 1 January 2012.

Ray indicated that the following transactions were made on a cash basis during the year ended 31 December 2012.

• Revenue (Sales): Landscaping $175 000
• Transportation $30 000
• Expenses: Interest expense $5 100
• Vehicle repairs $6 500
• Wages $36 000
• Building repairs $2 500
• License and road tax $4 500
• Vehicle maintenance $48 000
• Sundry expenses $12 100

Prepare a Receipts and Payments Account for Ray for the year ended 31 December 2012. Include ALL previous cash and cheque transactions.

Ray later provided the following additional information.

• The landscaping revenue included an amount of $1 500 paid in advance by James Long for landscaping his yard, in March of 2013.

Using the information given for preparation of the Receipts and Payments Account in Question 6, calculate the TOTAL revenue earned by the business for the year ended 31 December 2012. Show working clearly.

The following additional information was provided by Ray.

• $2 500 was owing to the garage in respect of vehicle maintenance.
• Sundry expenses were prepaid by $600.

Using the information given for preparation of the Receipts and Payments Account in Question 6, calculate the amount to be shown in the accounts for 2012 for the following expenses. Show working clearly.

Depreciation was provided as follows:

• Building 5% of cost
• Lawn mowers 20% of cost

Calculate the depreciation expenses on the following. Show working clearly.

List and total the expenses of the business for the year ended 31 December 2012.

Items of Expense Value

Show the net income (net profit) for the year ended 31 December 2012. Show working clearly.

Under which heading in the balance sheet would the following items appear?

Calculate the net income (net profit) margin, to ONE decimal place, for Ray's business. Show working clearly.