SPS 4E Solutions Prelims 2022

SPS Prelim 2022 Paper 2 Q1a $ $ Sales Revenue 1,29,920 1 Less: Sales Returns 9,500 1 Net sales Revenue 1,20,420 Less: Cost of sales 31,480 1 Gross Profit 88,940 1 Add: Other Income: Commission income 1,600 2 Less : other expenses Salaries expense (22960+2040) 25,000 2 Interest Expense (8% x 20000) 1,600 2 Rental Expense (30500-1900) 28,600 2 Depreciation of fixtures and Fittings (60200 x 10%) 6,020 2 Depreciation of motor vehicles (120000-16500) 20,700 2 Impairment loss on trade receivables (800+410) 1,210 83,130 2 Profit for the year 7,410 18 Q 1 b Assets Non-current assets Cost Accumulated Depreciation Net Book Value $ $ $ ,mn Fixtures and Fittings 60,200 8,930 51,270 2 Motor vehicle 1,20,000 37,200 82,800 2 Office Equipment 1,34,070 Current assets Trade receivables (20410-410) 20,000 1 Less: Allowance for impairment on trade receivables 800 Net Trade receivables 19,200 1 Inventory 22,980 1 Rental expense prepaid 1,900 1 Rental income receivable 350 1 Cash at bank (25720+80000) 1,05,720 1,50,150 2 Total assets 2,84,220 1 Equity and liabilities Shareholders' equity Share Capital 150 000 Ordinary Shares 2,30,000 1 Retained Earnings (10530+7410-7500) 10,440 2 Total Shareholders Equity 2,40,440 Non-current liabilities Long-term borowings (20000-5000) 15,000 1 Current liabilities Trade Payables 13,740 1 Salaries expense payable 2,040 1 Interest expenses payable (1600-1100) 500 1 Current portion of long term borrowing 5,000 1 Dividens Payable 7,500 28,780 1 Total equity and liabilities 2,84,220 1 22 Shane Gabriel Shane Gabriel Statement of Financial Position as at 31 December 2021 Statement of Financial Performance for the year ended 31 December 2021