MJR 4E5N PRE POA P1 2024

MANJUSRI SECONDARY SCHOOL 2024 PRELIMINARY EXAMINATION Name Class Index Number PRINCIPLES OF ACCOUNTS Secondary Four Express / Five Normal (Academic) Paper 1 Candidates answer on the Question Paper. 7087/01 26 August 2024 1 hour READ THESE INSTRUCTIONS FIRST Write your name, index number and class 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. The use of an approved calculator is allowed. 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. Parent’s / Guardian’s Signature: …………………….. For Examiner’s Use Q1 /11 Q2 /10 Q3 / 8 Q4 /11 Total /40 This document consists of 10 printed pages and 2 blank pages. [Turn over

2 7087/01/4E5N/POA/PRELIM/2024 Answer all questions. 1 Dillon operates an advertising business. His business makes an average annual profit of over $300 000. He decides that his business should treat purchases of office equipment costing less than $500 as revenue expenditure. REQUIRED (a) Name and explain the accounting theory applied when recording purchases of non- current assets of low value as revenue expenditure. Name ………………………………………………………………………………………. [1] Explanation …………………………………………………………………………………… ………………………………………………………………………………………………….. ………………………………………………………………………………………………….. ………………………………………………………………………………………………….. ………………………………………………………………………………………………….. ………………………………………………………………………………………………. [2] (b) State one difference between capital and revenue expenditure. ………………………………………………………………………………………………….. ………………………………………………………………………………………………….. ………………………………………………………………………………………………….. ………………………………………………………………………………………………….. ………………………………………………………………………………………………. [2]

3 7087/01/4E5N/POA/PRELIM/2024 Dillon’s business bought a new equipment from Japan and trained staff to operate it. REQUIRED (c) Complete the following table by inserting a tick (√) to show whether each item of expenditure relating to the new equipment should be treated as capital or revenue expenditure. The first item has been completed as an example. Capital expenditure Revenue expenditure Installation cost √ Staff training √ Shipping cost from Japan to Singapore √ [2] During the financial year ended 31 May 2024, Dillon extended his office premises at a cost of $38 800, which included $3 000 for repairs to his existing office premises. The full amount of $38 800 was recorded in the statement of financial performance. (d) State the effect and amount of including the full cost of $38 800 on the business. (i) Profit for the year ended 31 May 2024 ……………………………………………………………………………………….. [2] (ii) Non-current assets on 31 May 2024 ……………………………………………………………………………………….. [