SPS POA 2026 4E5NA PRELIMS P2

NAMEFORM CLASSACAD CLASSINDEX NO. ST. PATRICK’S SCHOOLPRELIMINARY EXAMINATION 2026SUBJECT:Principles of AccountsDATE:14 August 2026(7087/02)LEVEL:Secondary 4 Express/5NADURATION:2 hours Candidates answer on the Question Paper.READ THESE INSTRUCTIONS FIRSTWrite your Name, Form Class, Acad Class and Index No. in the spaces at the top of the page.Write in dark blue or black pen.Do not use staples, paper clips, glue or correction fluid.Answer all questions.If working is needed for any question it must be shown with the answer.The use of an approved scientific calculator is expected, where appropriate.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.The total of the marks for this paper is 60.For Examiner’s UseScore/60This question paper consists of 16 printed pages including this cover page.

2 Answer all questions.1Refer to the Insert for data for Question 1.REQUIRED(a)Prepare the statement of financial performance for the business for the year ended 31 August 2026.[10]Advance Technology Company Statement of financial performance for the year ended 31 August 2026

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4 (b)Prepare the statement of financial position as at 31 August 2026. [10]Advance Technology CompanyStatement of Financial Position as at 31 August 2026

5 [Total: 20]2The trade receivable account for Lancelot Trading in the books of Macbeth Trading is shown below.

6 Trade receivable-Lancelot TradingDateParticularsDebit ($)Credit ($)Balance ($)2026Jul 1Balance b/d24 000 Dr8Sales revenue12 30036 300 Dr12Sales returns 90035 400 Dr20Cash at bank 4 90030 500 Dr20Discount allowed 10030 400 Dr31Cash at bank 6 08024 320 Dr31Allowance for impairment of trade receivables24 3200REQUIREDa) Interpret the entries on the following dates.[3] (i) July 8 (ii) July 20 (iii) July 31b) Explain with an accounting theory why it is necessary for Macbeth Trading to account for impairment loss on trade receivables.[2]

7 The following information was obtained from the business for the year ended 31 July 2026.$Sales revenue390 000Sales returns 5 900Net trade receivables as at 1 August 2025 31 200Net trade receivables as at 31 July 2026 42 600REQUIREDc) Calculate the following for the year ended 31 July 2026.i) rate of trade receivables turnover.ii) trade receivable collection period.Round off your answers to 2 decimal places. The following data was obtained for the year ended 31 July 2025.Rate of trade receivables turnover: 16.8 timesTrade receivables collection period: 21.72 daysd) Evaluate the efficiency of Macbeth Trading’s trade receivables management over the two years. [2] [2]

8 e) Explain the importance of efficient trade receivable management to the business.[1] f) Suggest one way for the business to improve on its trade receivables management.[1]

9 [Total: 11]3The following information was provided by Comfy Walker Pte Ltd on 1 June 2025.$Share capital, 200 000 ordinary shares200 000Retained earnings 25 000On 1 March 2026, 70 000 shares were issued at $0.50 each. All the shares were fully paid via bank transfer. On 30 May 2026, a dividend of $0.20 was declared, to be paid out on 1 July 2026. The profit for the year ended 31 May 2026 was $63 700.REQUIREDa) Prepare journal entries to record the following.[3] i) Issue of share capital on 1 March 2026. ii) Declaration of dividends on 30 May 2026. iii) Transfer of profits on 31 May 2026.

10 b) Prepare the Statement of financial position of the business as at 31 May 2026, showing only the equity section. [2] The business also provided the following information on the business for the year ended 31 May 2026.2026Net sales revenue768 000Cost of sales612 000Total operating expenses 92 300Average equity247 350REQUIREDc) Calculate the following ratios for the year ended 31 May 2026. i) Gross profit margin ii) Profit margin [1][1]