PCSS 2022 POA P1

PEICAI SECONDARYSCHOOLSECONDARYFOUREXPRESS/FIVENORMALACADEMICPRELIMINARYEXAMINATION2022 CANDIDATENAME CLASS REGISTERNUMBER PRINCIPLESOFACCOUNTS 7087/01 Paper1 25August20221hourCandidatesanswerontheQuestionPaper. NoAdditionalMaterialsarerequired. READTHESEINSTRUCTIONSFIRST Writeyourname,classandregisternumberinthespacesatthetopofthispage.Writeindarkblueorblackpen.YoumayuseanHBpencilforanydiagramsorgraphs.Donotusestaples,paperclips,glueorcorrectionfluid.Theuseofanapprovedcalculatorisallowed. Answerallquestions. Thebusinessesdescribedinthisquestionpaperareentirelyfictitious. Thenumberofmarksisgiveninbrackets[ ] attheendofeachquestionorpartquestion.

2 Thisdocumentconsistsof8printedpages.Setter:MdmSooSioKoon1 Chryslerruns a businesssellingartisancandles.Thefollowinginformationhasbeenprovided. Costof salesfor theyearended: 30June202030June2021 Inventoryat: 30June201930June202030June2021 REQUIRED (a) Calculatetherateof inand2021.Showyouran Rate of inventoryturnover(times) (b) Evaluatethemanagemyearsended30June20 …………………………… …………………………… …………………………… ……………………………

3 …………………………… …………………………… ……………………………(c) Suggesttwowaysin wmanagementofthebusi 1.………………………… …………………………… 2.………………………… …………………………… Chryslerpurchasesandsellscandlesoncreditonly. ThebusinessusestheFirst-In-First-Out(FIFO)methodtorecorditsinventory. Thefollowinginformationfortheyearended30June2022isprovided: Inventoryon1July2021 Purchases2021 NumberofcandleJul17 300Sep29 8002022May11 1200 Sales2021 NumberofcandSep5 800 REQUIRED (d) Calculatethecostofsale …………………………… …………………………… (e) Calculatethegrossprofi

4 …………………………… …………………………… On 2 July 2022,due toheavyrain,the warehousewasfloodedand$5000ofthebusinessinventorywassoakedin water. Chryslermadean insuranceclaimand was able to recover90%of thelossincurredon15July2022. Theinsuranceclaimwillbepaidoutinthenextmonth. REQUIRED (f) PreparethejournalentryAnarrationisnotrequire Date (g) PreparethejournalentryAnarrationisnotrequire Date

5 2 ThefinancialyearofMeomiandPugscaféendson31May. Thefollowinginformationrelatestothebusinessexpenses. 1June2021 31May2022$ $Advertisingpayable 5700 8200 Advertisingof$10500waspaidbychequeduringtheyearended31May2022. REQUIRED (a) Nameandexplaintheaccountingtheorywhichisappliedwhenaccountingforunpaidadvertising. Name…………………………………………………………………………………… Explanation…………………………………………………………………………….. …………………………………………………………………………………………... …………………………………………………………………………………………... …………………………………………………………………………………………...[2] (b)

6 Calculatetheamountof advertisingexpenseincurredfortheyearended31May2022. …………………………………………………………………………………………... …………………………………………………………………………………………... ……………………………………………………………………………………………[3] ThefollowingrentincomeaccountwasextractedfromthebooksofMeomiandPugscaféfortheyearended31May2022. Rentincomeaccount2021 Particulars Dr($) Cr($) Balance($)Jun1 Rentincomereceivedinadvance 5900 5900CrOct10 Cashatbank 15000 20900Cr2022May31 Rentincomereceivable 2200 23100CrIncomeSummary 23100 - REQUIRED (c) Interpreteachoftheentrieson31May2022. …………………………………………………………………………………………... …………………………………………………………………………………………... …………………………………………………………………………………………... …………………………………………………………………………………………[2]

7 (d) Explaintherevenuerecognitiontheory. …………………………………………………………………………………………... …………………………………………………………………………………………... …………………………………………………………………………………………[2] (e) Explaintheeffectsonprofitfortheyearandtheaccountingelementin thestatementoffinancialpositioniftherentincomereceivablewasnotadjusted. Profit…………………………………………………………………………………….. Accountingelement……………………………………………………………………[2] [Total:11] 3 ShaggysellsgoodsoncredittoRogers. ShaggyissuesaninvoiceandacreditnotetoRogers. REQUIRED (a) Completethetabletonamewhichledgeraccountseachbusinesswouldusetorecordeachdocument. BooksofShaggy’sbusiness BooksofRogers’sbusinessAccounttobedebited Accounttobecredited Accounttobedebited AccounttobecreditedInvoice Creditnote

8 [4] (b) Statethedifferencebetweenacashtransactionandacredittransaction. …………………………………………………………………………………………... …………………………………………………………………………………………... …………………………………………………………………………………………...[2] Shaggyownsabusinesssellingpetcarriersandcrateaccessories. ThefollowingtransactionstookplaceduringJanuary2022. Jan14 Paid$500cashtoatradesupplier. 21 Shaggywithdrew$10800fromthebusinessbankaccounttopayforhisholidayexpenses. 25 Bankchargesof$125waschargedonthebusinessbankaccount. 30 Receiveda cheque$7100fromFurballsCaféto cleartheoutstandingamountowedto date. A cashdiscountof $150wasgivento FurballsCafé. REQUIRED (c) Completethefollowingtabletoshowtheeffectsofeachtransactiononassets,liabilitiesandowner’sequity. Theeffectsofthefirsttransactionhavebeencompletedasanexample. 2022 EffectsoftransactionsonAssets($) Liabilities($) Owner’sequity(S)Jan14 -500(Cashinhand) -500(Tradepayable) Noeffect 21

9 25 30 [7] [Total:13] ------------------------------------------------Endofthepaper------------------------------------------