SWISS_COTTAGE_2022_4E5N_EXAM_POA_PRELIM_P2

SWISSCOTTAGESECONDARYSCHOOLSECONDARYFOURANDFIVEPRELIMINARYEXAMINATION O Name: ( ) Class: PRINCIPLESOFACCOUNTS Paper 2 Additional Materials: Answer paper (6sheets) 7087/02Tuesday30August 20222hours READTHESEINSTRUCTIONSFIRST Writeyour name, classandindexnumber onall theworkyouhandin.Writeindarkblueor blackpenonbothsidesof thepaper.YoumayuseanHBpencil for roughworking.Donot usestaples, paper clips, glueor correctionfluid.Theuseof anapprovedcalculator isallowed. Answer all questions. Thebusinessesdescribedinthisquestionpaper arefictitious.Start eachquestiononaseparatepage.All calculationsmust beshownadjacent totheanswer. At theendof theexamination, fastenall your worksecurelytogether.Thenumber of marksisgiveninbrackets[ ] at theendof eachquestionor part question. Thisdocument consistsof 8printedpages. Setter: MrsFan-FongSookThengVetter: MsKarenAng [Turnover HomeofThoughtfulLeaders:ServewithHonour,LeadwithHumility

2 Answer all questions. 1 The following balances were taken fromthe booksSappyPteLtd, aclothesretailer, on30June2022. $ Motor vehicles 150000 Premises 240000 Accumulateddepreciation–Motor vehicles 15000 Accumulateddepreciation–Premises 94500 Salesrevenue 652900 Salesreturn 21470 Cost of sales 290450 Discount received 12300 Discount allowed 19430 Rent income 18000 Salariesexpense 29000 Insuranceexpense 12900 Utilitiesexpense 10340 5%LoanfromSwissBank 50000 Cashat bank 50470 Tradereceivables 92940 Allowancefor impairment of tradereceivables 5230 Inventory 75900 Tradepayables 24190 Retainedearnings 20780 Sharecapital, 100000ordinaryshares 100000

3 Additional information 1. From 1 July 2021, the company began to sublet part of the office space at $2 500 permonth. Themonthlyrent wasincreasedby$500from1January2022onwards. 2. Interest onloanisstill owing. 3. Aquarter of theloanisrepayableon1January2023. 4. $50 000 worth of goods was destroyed in a warehouse fire and this is not recorded in thebooks. The insurance company will compensate $25 000 for the damaged inventory.Payment will bemadeon31December 2022. 5. One of the credit customers who owed $1 500 was declaredbankrupt. Thedebt hasyet tobewrittenoff. 6. A review of the trade receivables showed that 5%of the trade receivables are likely tobecomeuncollectible. 7. Motor vehicles are to be depreciated at 10%per annumusing reducing balanced method.Premisesaretobedepreciatedat 20%per annumusingstraight linemethod. 8. Adividend of $0.05 per share was declared on 30 June2022. Thedividendwill bepaidon31July2022. REQUIRED (a) Prepare the statement of financial performance for the year ended 30 June2022. [8] (b) Preparethestatement of financial positionasat 30June2022.[12] [Total: 20]

4 2 The following information is extracted from the statement of financial performance of TimTradingfor theyear ended31December 2021. Net salesrevenue $150000 Averageinventory $5800 Total operatingexpenses $45000 GrossProfit Margin 40% Returnonequity 8% REQUIRED (a) Calculatethefollowingfor theyear ended31December 2021.