POA GO Contents O-Level (Combined)

Name: ______________________________( ) Class: ________ Principles of Accounts Serangoon Secondary School (2023) POA GO (Pink Booklet) Revision Notes Content Ch 1 – 16 Formula list Revision Practices Adjusted Financial Statements Schools’ Prelim Papers 2015 to 2020 O-Level questions modified from previous syllabus 7175 (Orange Booklet)

Revision Notes Content Chapter Topic Page 1 Introduction to accounting 2 Accounting information system 3 Elements of financial statements and the accounting equation 4 Double-entry recording 5 Trial balance and financial statements 6 Revenue and other income 7 Cost of sales and other expenses 8 Cash 9 Inventories 10 Trade receivables 11 Non-current assets 12 Trade payables 13 Long-term borrowings 14 Equities 15 Correction of errors 16 Financial statements analysis

Formula List 7087 O-Level 1 Profitability Ratios Gross profit margin (%) Gross profit Net sales revenue × 100% Mark-up on cost (%) Gross profit Cost of sales × 100% Profit margin (%) Profit Net sales revenue × 100% Return on equity (%) Profit Average equity × 100% Average equity = Equity (start) + Equity (end) 2 • Sole proprietorship: owner’s equity • Private limited company: shareholders’ equity Liquidity Ratios Working capital ($) Current assets − Current liabilities Current ratio (no units) Current assets Current liabilities Quick ratio (no units) Current assets − Inventory − Prepaid expense Current liabilities OR Cash + Receivables Current liabilities

Formula List 7087 O-Level 2 Efficiency Ratios Rate of inventory turnover (times) Cost of sales Average inventory Average inventory = Inventory (start) + Inventory (end) 2 Days sales in inventory (days) Average inventory Cost of sales × 365 days OR 1 rate of inventory turnover × 365 days Rate of trade receivables turnover (times) Net credit sales or service fee revenue Average net TR Average net TR = Net TR (start) + Net TR (end) 2 Net TR = TR – Allowance for impairment of TR Trade receivables collection period (days) Average net TR Net credit sales or service fee revenue × 365 days OR 1 rate of TR turnover × 365 days

Formula List 7087 O-Level 3 Basic accounting equation Assets = Liabilities + Equity Expanded accounting equation (sole proprietorship) Assets = Liabilities + Owner’s equity Assets = Liabilities + Capital + Profit (or – Loss) – Drawings Assets = Liabilities + Capital + (Income – Expenses) – Drawings Capital Beginning capital + Additional capital + Profit (or – Loss) – Drawings Expanded accounting equation (private limited company) Assets = Liabilities + Shareholders’ equity Assets = Liabilities + Share capital + Retained earnings Assets = Liabilities + Share capital + Profit (or – Loss) – Dividends Assets = Liabilities + Share capital + (Income – Expenses) – Dividends Share capital Total number of shares issued × Issued price per sha