Pasir RIs Sec 4E5N POA Prelim (Paper 1) ANS

Name Class Register Number SECONDARY 4 EXPRESS / 5 NORMAL (ACADEMIC) PRELIMINARY EXAMINATION 2022 PRINCIPLES OF ACCOUNTS Paper 1 Friday 1030 – 1130 7087/01 26 August 2022 1 hour Students answer on the Question Paper. No Additional Materials are required. READ THESE INSTRUCTIONS FIRST Write your name, class and register number in the spaces at the top of this page. Write in dark blue or black pen. Do not use staples, paper clips, glue or correction fluid. Answer all questions. The number of marks is given in brackets [ ] at the end of each question or part question. The total of the marks for this paper is 40. This document consists of 10 printed pages. Setter: Lee Chee Weng [Turn over Pasir Ris Secondary School

2 Answer all questions. 1 Jin Yun, a sole proprietor runs a recruitment service. The business ends its financial year on 31 July. The following balance was extracted from her books: Jin Yun charges a fixed recruitment service fee of $7 950 per month to her only customer, Wong Maid Agency. Service fee revenue received and banked in for the year ended 31 July 2022 was $87 900. REQUIRED Prepare the following: (a) Journal entries to account for service fee revenue for the year ended 31 July 2022 including the closing entry. Narrations are not required. [4] General Journal Date Particulars Debit Credit $ $ 1 August 2021 $ Service fee revenue received in advance 3 000

3 The following information relates to the rental expense for the year ended 31 July 2022: 1 On 1 August 2021, Jin Yun Recruitment Agency’s rental expense payable account had a balance of $1 600. 2 As at 31 July 2022, $30 000 has been paid for rent. 3 On 31 July 2022, the rental expense payable account showed a balance $3 600 (b) Calculate the rental expense for the year ended 31 July 2022. [3]

4 (c) Prepare an extract of the statement of financial position as at 31 July 2022. [2] (d) Explain the term ‘income’. [1] (e) Explain the effects on profit for the year and current assets if income receivable is not adjusted at the end of financial year. [2]

5 (f) Explain the term ‘expense’ [1] (g) Explain the accrual basis of accounting for the accounting of income and expenses. [1] (h) State two advantages of setting up her business as a Sole Proprietorship. [2] (i) State two advantages that Jin Yun might consider if she decides to change the business setup to a Limited Liability Partnership. [2] [Total: 18]

6 2 The following financ