JWSS 2023 POA P2 QP

Class Index Number Name: Setter: Ms Shirley Neo Page 1 of 8 Jurong West Secondary School Preliminary Examinations 2023 60 Candidates answer on foolscap papers provided. READ THESE INSTRUCTIONS FIRST Write your name, class and index number in the spaces on all the work you hand in. Write in dark blue or black pen. You may use an HB pencil for any diagrams, graphs, tables or rough working. Do not use staples, paper clips, glue or correction fluid. The use of an approved calculator is allowed. You may lose marks if you do not show your working or if you do not use appropriate units. 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. After checking of answer script Checked by Signature Date Student PRINCIPLES OF ACCOUNTS Paper 2 Secondary Four Normal Academic 7086/02 Thursday, 3 Aug 2023 0800 - 1000 2 hours NA JWSS Preliminary Examinations 2023 Principles of Accounts 7086/02 Secondary 4NA Page 2 of 8 There are a total of 8 printed pages (including the cover page) Answer all questions. 1 The following trial balance was extracted from the books of Jie Ge’s business at the end of the financial year on 30 June 2023. $ Sales revenue 87 000 Sales returns 600 Office equipment at cost 46 000 Accumulated depreciation of office equipment 9 200 Cost of sales 11 700 Allowance for impairment of trade receivables 2 400 Loan (repayable 30 June 2025) 16 800 Capital, 1 July 2022 34 020 Cash at bank 4 200 Commission income 5 600 Drawings 8 400 Inventory 10 800 Loan interest 620 Rent expense 8 200 Wages and salaries 48 300 Trade receivables 28 600 Trade payables 12 400

JWSS Preliminary Examinations 2023 Principles of Accounts 7086/02 Secondary 4NA Page 3 of 8 Additional information 1 On 30 June 2023 Rent $500, was paid in advance. Loan interest $1880 was still oustanding. Commission income of $1400 has not been received. 2 Jie Ge’s drawings of $790 were included in wages and salaries. 3 Uncollectible debt, $600, was to be written off. 4 Allowance for impairment of trade receivables is to be $2000. 5 Depreciation of office equipment is to be provided at 20% per annum using reducing balance method. REQUIRED (a) Prepare the statement of financial performance for the year ended 30 June 2023. [10] (b) Prepare the statement of financial position as at 30 June 2023. [10] [Total: 20] JWSS Preliminary Examinations 2023 Principles of Accounts 7086/02 Secondary 4NA Page 4 of 8 2 Eilzabeth opened an Ez-Cafe on 1 July 2021. The following information was available from her business. Date Transaction 2021 Jul 1 Elizabeth invested $15 000 cheque to open the Ez-Cafe. Dec 15 She paid $2 000 to trade payables using her personal cheque. 2022 Jun 30 Profit for the year amounted to $7 800. Dec 27 Elizabeth withdrew $800 from the business bank account to pay for her own utilities. 2023 Jan 5 Elizabeth took $500 goods for her family use. Jun 30 Loss for the year amounted to $1 690. REQUIRED (a) Prepare the closing entry to transfer the total drawings to capital account for the year ended 30 June 2023. A narration is required. [3] (b) Prepare the capital account for the two years ended on 30 June 2022 and 30 June 2023. [7] (c) Define owner’s equity. [1] (d) Explain, with an accounting theory, how the business treats owner’s contributions and withdrawal of business’s resources for personal use. [2] [Total: 13]

JWSS Preliminary Examinations 2023 Principles of Accounts 7086/02 Secondary 4NA Page 5 of 8 3 Tyson Ltd buys machines to manufacture rubber tyres. The business estimates that its machineries have a useful life of 10 years and charges a full year of depreciation for its non-current assets in the year of purchase. The financial year for Tyson Ltd ends on every 31 December. The following accounts relate to the business’s machineries. Machineries account Date Particulars Debit Credit Balance 2021 $ $ $ Jan 1 Loan from Beng Finance (i) 60 000 60 000 Dr 2022 Jan 1 Balance b/d 60 000 Dr Jul 1 Trade payable – Big Trading (ii) 40 000 100 000 Dr 2023 Jan 1 Balance b/d 100 000 Dr Accumulated depreciation of machineries account Date Particulars Debit Credit Balance 2021 $ $ $ Dec 31 Depreciation of machineries 6 000 6 000 Cr 2022 Jan 1 Balance b/d 6 000 Cr Dec 31 Depreciation of machineries (iii) 10 000 16 000 Cr 2023 Jan 1 Balance b/d 16 000 Cr JWSS Preliminary Examinations 2023 Principles of Accounts 7086/02 Secondary 4NA Page 6 of 8 REQUIRED (a) Interpret the entries on the following dates: (i) 1 January 2021 (ii) 1 July 2022 (iii) 31 December 2022 [3] (b) Explain the method of depreciation used by the business. [2] (c) Name the ledger account to which depreciation expense is transferred to when the account is closed at the end of the year. [1] (d) Define depreciation. [1] (e) Define accumulated depreciation. [1] (f) State and explain using a relevant accounting theory why Tyson Ltd should charge depreciation on its non-current assets. [2] (g) Tyson Ltd intents to change the depreciation method used on machineries in the subsequent years. Explain, with a relevant accounting theory, if this is advisable. [2] [Total: 12]

JWSS Preliminary Examinations 2023 Principles of Accounts 7086/02 Secondary 4NA Page 7 of 8 4 Joshua sells running shoes and buys on credit from Linear Style. The credit period is 15 days and there is a trade discount of 20% on all credit purchases. Linear Style’s credit term is to offer 5% cash discount for payment made within 15 days of the invoice date. The following transactions occurred in the month of April 2023. 2023 5 Apr Joshua received an invoice with a list price, $5000 from Linear Style. 8 Apr Joshua received a credit note from Linear Style for the goods bought previously on 5 April. The list price of these goods was $200. 20 Apr Issued a cheque to Linear Style in full settlement of amount owing. REQUIRED (a) State the journal entries with which Joshua recorded the transactions occurred in the month of April 2023. Narrations are not required. [8] (b) Explain the difference between credit transaction and cash transaction. [2] JWSS Preliminary Examinations 2023 Principles of Accounts 7086/02 Secondary 4NA Page 8 of 8 Joshua is considering to buy its running shoes from an online shop, Kinetic Degree, instead of its usual supplier, Linear Style. The following information is available. Supplier Linear Style Kinetic Degree Price per pair of running shoes $80 $70 Trade discounts given for every 100 pair of running shoes 20% 5% Credit period 15 days 30 days Nature Physical shop Online business Return policy All running shoes can be returned within 15 days and exchanged for new ones without additional charge. All running shoes can be returned within 30 days. However, the buyer bears the transport cost of returning the running shoes. Reputation of supplier ● 10 years in business ● Positive feedback from loyal customers ● 2 years in business ● Positive online reviews REQUIRED (c) Advise Joshua which supplier he should choose. Justify your decision with two reasons. [5]