Damai Sec 2024 POA Paper 1 and 2 with Answers

DAMAI SECONDARY SCHOOLPreliminary Examination 2024CANDIDATE NAMECLASSINDEX NUMBERPRINCIPLES OF ACCOUNTSPaper 1 Secondary 4 Express / 5 Normal (Academic)Setter: Miss Cristy Lin7087/0123 August 20241 hour 40 MarksCandidates answer on the Question Paper.No Additional Materials are required.READ THESE INSTRUCTIONS FIRSTWrite your index number, name and class in the spaces at the top of this page. Write in dark blue or black pen. You may use an HB pencil for any diagrams or graphs. Do not use staples, paper clips, glue or correction fluid. Answer all questions. The businesses described in this question paper are entirely fictitious. The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 8 printed pages.[Turn over

2Answer all questions1Oppa Wen Hao sells snacks imported from South Korea and ends its financial year on 31 May. On 1 June 2021, the business had a capital balance of $50 000. The following transactions took place between 2021 and 2023. DateDescription of Transaction2021Aug 3The owner contributed $7 000 cash to the business bank account. 2022Apr 25The owner took $600 goods for personal use. May 31Profit for the year amounted to $89 400.Aug 24The owner contributed a chair $300 to the business. 2023May 31Loss for the year amounted to $2 570.REQUIRED(a)Explain the accounting theory behind the transaction on 3 August 2021. [2](b)Prepare the drawings account for the year ended 31 May 2022. DrawingsDateParticularsDebitCreditBalance$$$[2]

3(c)Prepare the capital account for the years ended 31 May 2022 and 31 May 2023. CapitalDateParticularsDebitCreditBalance$$$ [6](d)Explain any two reasons why the owner’s equity changed over the year ended 31 May 2022. [2][Total: 12]

42Yvonne runs a service business. The financial year end is 31 December. On 1 April 2023, the business obtained a bank loan of $300 000 at an interest rate of 3% per annum. The loan is to be paid equally over 10 years.The partial principal sum repayment and interest are to be made every year starting 31 March 2024. REQUIRED(a)Prepare journal entries to record the borrowing on 1 April 2023 and the interest expense incurred on 31 December 2023. Narrations are not required. JournalDateParticularsDebitCredit$$[3](b)Prepare an extract of the statement of financial position as at 31 December 2023, showing only the liabilities section. YvonneStatement of financial position as at 31 December 2023 (extract)$ [3][Turn over

5(c)Use a suitable accounting theory to explain why interest expense is recorded. [2][Total: 8]3Iris owns a business selling eyewear. For the year ended 31 August 2023, she had the following information pertaining to her rental expenses account. Rental expenseDateParticularsDebitCreditBalance2022$$$Sep 1Rent expense payable300300 Cr2023Aug 30Cash at bank 4 5004 200 DrAug 31Prepaid rent 6003 600 Dr?REQUIRED(a)State the account in which the amount of rent expense is tra