2024 BPGHS S5 POA P2 (QP)

Name of Candidate: …………………………………………… ( ) Class: …………… This paper consists of 16 printed pages [Turn over BUKIT PANJANG GOVERNMENT HIGH SCHOOL PRELIMINARY EXAMINATION 2024 SECONDARY 5 GCE 'O' LEVEL SYLLABUS PRINCIPLES OF ACCOUNTS Paper 2 7087/02 21 August, 2024 2 hours 0750 h – 0950 h READ THESE INSTRUCTIONS FIRST Do not turn over the cover page until you are told to do so. Write in dark blue or black pen on both sides of the paper. You may use an HB pencil for any diagrams or graphs. Do not use staples, paper chips, glue or correction fluid. The use of an approved calculator is allowed. Answer all the 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. FOR EXAMINER’S USE Question 1 / 20 Question 2 / 21 Question 3 / 8 Question 4 / 11 Total: / 60 Candidates answer on the Question Paper Additional Materials: Insert

2 © BPGHS Preliminary Examination 2024 7087/02 1 Refer to the Insert for data for Question 1. REQUIRED (a) Prepare the statement of financial performance for the year ended 31 March 2024. Le-Vince Pte Ltd Statement of Financial Performance for the year ended 31 March 2024

3 © BPGHS Preliminary Examination 2024 7087/02 [Turn over [10]

4 © BPGHS Preliminary Examination 2024 7087/02 (b) Prepare the statement of financial position as at 31 March 2024. Le-Vince Pte Ltd Statement of Financial Position as at 31 March 2024

5 © BPGHS Preliminary Examination 2024 7087/02 [Turn over [10] [Total: 20]

6 © BPGHS Preliminary Examination 2024 7087/02 2 Tahiya runs a business of buying and selling car accessories. The business provided the following drawings account for the year ended 30 September 2024. Drawings account Date Particulars Debit Credit Balance 2023 $ $ $ Nov 11 Cash at bank 2 000 2 000 Dr Dec 5 Cash at bank 500 2 500 Dr 2024 May 6 Inventory 1 250 3 750 Dr Sep 30 Capital 3 750 - REQUIRED (a) Define drawings. [1] (b) State and explain the accounting theory behind the transaction on 5 December 2023. Accounting theory Explanation [3] (c) Interpret the entries in the drawings account on: (i) 6 May 2024 [1] (ii) 30 September 2024 [1]

7 © BPGHS Preliminary Examination 2024 7087/02 [Turn over The following information was extracted from the books of Tahiya’s business as at 30 September 2022, 2023 and 2024. 2022 2023 2024 Non-current assets $ $ $ Motor vehicles, net book value 86 700 84 000 83 450 Current assets Inventory 15 100 29 700 37 800 Net trade receivables 9 200 14 300 15 080 Cash at bank 7 800 7 500 - Prepaid rent expense - 490 15 700 Total current assets 32 100 51 990 68 580 Current liabilities Trade payables 10 100 22 490 19 770 Salaries payable - 3 400 1 990 Bank overdraft - - 19 050 Total current liabilities 10 100 25 890 40 810 REQUIRED (d) Explain the difference between liquidity and profitability. [2] (e) Calculate the following as at 30 September 2024. Show your answer to two decimal places. (i) Current ratio [2]

8 © BPGHS Preliminary Examination 2024 7087/02 (ii) Quick ratio [2] Tahiya also provided the following information relating to 30 September 2022 and 2023. 2022 2023 Current ratio 3.18 2.01 Quick ratio 1.68 0.84 REQUIRED (f) Taking into account the above information and your answer in part (e), evaluate the liquidity of Tahiya’s business over the three years. [7]

9 © BPGHS Preliminary Examination 2024 7087/02 [Turn over (g) Suggest two ways Tahiya can improve on the liquidity of her business. 1 2 [2] [Total: 21]

10 © BPGHS Preliminary Examination 2024 7087/02 3 Keane runs a hair salon. When preparing the financial statements of his business for the year ended 31 December 2024, he discovered the following errors. 1 Cash payment of $450 to Shaun was recorded in Sean’s account. 2 Motor vehicle maintenance fees of $670 have been recorded in the motor vehicle account. 3 Included in the rental expense was $290 paid for motor vehicle used by Keane for his personal trips. 4 Cheque of $1 000 received for commission income has been debited to the commission income account and credited to the cash at bank account. The profit for the year before discovering the errors was $20 450. REQUIRED (a) Explain why the trial balance is able to balance even though there are errors. [2] (b) Prepare a statement to show the adjusted profit for the year ended 31 December 2024. Keane Statement to show adjusted profit for the year ended 31 December 2024 [4]