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IGCSE Accounting 2003 – 2012
Mark Schemes
Table of Contents (1)
Old Syllabus2003 -2009
June 2003 Paper 1 Page 3
June 2003 Paper 2 Page 5
June 2003 Paper 3 Page 11
June 2004 Paper 1 Page 25
June 2004 Paper 2 Page 27
June 2004 Paper3 Page 31
June 2005 Paper 1 Page 43
June 2005 Paper 2 Page 45
June 2005 Paper 3 Page 54
June 2006 Paper 1 Page 63
June 2006 Paper 2 Page 65
June 2006 Paper 3 Page 71
June 2007 Paper 1 Page 80
June 2007 Paper 2 Page 82
June 2007 Paper 3 Page 88
June 2008 Paper 1 Page 98
June 2008 Paper 2 Page 100
June 2008 Paper 3 Page 107
June 2009 Paper 1 Page 116
June 2009 Paper 2 Page 118
June 2009 Paper 3 Page 127
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
www.igcseaccounts.com
IGCSE Accounting 2003 – 2011
Mark Schemes
Table of Contents (2)
New Syllabus2010-2011
June 2010 Paper 1(1) Page 137
June 2010 Paper 1 (2) Page 144
June 2010 Paper 1(3) Page 153
June 2010 Paper 2(1) Page 162
June 2010 Paper 2(2) Page 170
June 2010 Paper 2(3) Page 177
June 2011 Paper 1(1) Page 184
June 2011 Paper 1(2) Page 192
June 2011 Paper 1(3) Page 200
June 2011 Paper 2(1) Page 208
June 2011 Paper2(2) Page 218
June 2011 Paper 2(3) Page 227
June 2012 Paper 1(1) Page 236
June 2012 Paper 1(2) Page 245
June 2012 Paper 1(3) Page 252
June 2012 Paper 2(1) Page 261
June 2012 Paper 2(2) Page 269
June 2012 Paper 2(3) Page 278
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
www.igcseaccounts.com
June 2003
INTERNATIONAL GCSE
MARK SCHEME
MAXIMUM MARK: 40
SYLLABUS/COMPONENT: 0452/01
ACCOUNTINGPaper 1 (Multiple Choice)
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
www.igcseaccounts.com
Page 1 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 1
© University of Cambridge Local Examinations Syndicate 2003
QuestionNumber
KeyQuestionNumber
Key
1 D 21 A
2 D 22 C
3 A 23 C
4 B 24 C
5 A 25 D
6 A 26 C
7 B 27 C
8 C 28 B
9 D 29 B
10 C 30 B
11 A 31 B
12 B 32 D
13 C 33 B
14 A 34 B
15 A 35 D
16 B 36 A
17 A 37 B
18 B 38 A
19 B 39 B
20 D 40 B
TOTAL 40
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
www.igcseaccounts.com
June 2003
INTERNATIONAL GCSE
MARK SCHEME
MAXIMUM MARK: 90
SYLLABUS/COMPONENT: 0452/02
ACCOUNTINGPaper 2 (Structured Questions)
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
www.igcseaccounts.com
Page 1 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 2
© University of Cambridge Local Examinations Syndicate 2003
QuestionNumber
Mark Scheme DetailsPartMark
1
1
1
3
3
2
4
1
1
1
1
19
1 (a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
Trade creditors, accrued expense(s), bank overdraftOr acceptable alternative
N.P. is undervalued/understated
One from: Correction of errorsOpening entriesPurchase/sale of fixed assetOther transfers/adjustments
1. P/L Appropriation (1)
2. P/L (1)
3. P/L Appropriation (1)
1. Revenue2. Capital3. Capital
Asset (1) or expense (1)
Cost 1/1/01 20000- Depn. 31/12/01 (30%) 6000 (1) C/F
N.B.V. 31/12/01 14000 (1)
- Depn. 31/12/02 (30%) 4200 (1) O/Fs
N.B.V. 31/12/02 9800 (1)
Current liabilities
Imprest system
Error of commission
Advantage of business due to its:- reputation- well-established clientele Or other acceptable- location reason for paying- good staff relations/reliable workforce premium price- goodwill
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
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Page 2 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 2
© University of Cambridge Local Examinations Syndicate 2003
QuestionNumber
Mark Scheme DetailsPartMark
14
1
15
2 (a)
(b)
Danbi WyskeTrial Balance as at 30 April 2003
Dr Cr $ $
Stock 1 May 2002 4000 (1)
Sales 80000 (1)
Purchases 62000 (1)
Debtors 10000 (1)
Creditors 9000 (1)
Electricity 3000 (1)
General expenses 7000 (1)
Cash at bank 5000 (1)
Drawings 8000 (1)
Equipment at cost 45000 (1)
Provision for depreciation ofequipment 16000 (1)
Rent and insurance paid 6000 (1)
Capital 45000 (2) -1 O/F
150000 150000
Suspense Account
2 (a) An own figure mark for the Capital figure should only be awarded if a credit balanceis shown.
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
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Page 3 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 2
© University of Cambridge Local Examinations Syndicate 2003
QuestionNumber
Mark Scheme DetailsPartMark
6
2
3
4
15
3 (a)
(b)
(c)
(d)
(i) $12000 (1)
(ii) Purchase returns (accept ‘returns’) (1)
(iii) Closing stock (accept ‘Stock at 31 March 2003’) (1)
(iv) $5000 (1)
(v) received (1)
(vi) £15000 (1)
$30000 x 100 (1) = 15% (1) C/F
200000
Capital employed: $200000+ 50000 250000
$30000 x 100 (1) = 12% (2) O/F 1
250000 (1)
N.P. as percentage of capital employed:- measures overall profitability of the business in relation to resources
used- indicates adequacy of return on owner’s investment- enables comparisons to be made, e.g. against other investments,
earlier years, similar firms- assists decision-making, e.g. in production, cost of borrowing or other
acceptable points
For each reason given: 2 marks
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
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4 (
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17
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Page 4 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 2
© University of Cambridge Local Examinations Syndicate 2003
Prepared by D. El-Hoss
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Page 5 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 2
© University of Cambridge Local Examinations Syndicate 2003
QuestionNumber
Mark Scheme DetailsPartMark
4
10
2
16
5 (a)
(b)
(c)
Carrie OkieBalance Sheet as at 1 April 2002
$ $Fixed assets 50000 (1)
Current assets 20000 (1)
Less Current liabilities 15000 (1) 500055000
Capital 55000 (1)
(Horizontal format also acceptable)
Balance Sheet as at 31 March 2003$ $
Fixed assets 75000 (1)
Less Depreciation (20%) 15000 (1) 60000 (1)
Current assets 30000 (1)
Less Current liabilities 20000 (1) 1000070000
Capital 1/4/02 55000 (1) O/F
Add Net profit 25000 (2) 1 O/F
80000Less Drawings 10000 (1)
70000 (1) O/F
(Horizontal layout also acceptable)
$ $ $ Fixed assets 75000 (1) Capital 1/4/02 55000 (1) O/F
Less Depreciation 15000 (1) 60000 (1) Add Net profit 25000 (2) 1 O/F
80000Current assets 30000 (1) Less Drawings 10000 (1)
70000 (1)
Current liabilities 20000 (1)
90000 90000(10)
Prudence is observed by:
- not overstating profits, as depreciation is charged in P/L a/c 1 mark per acceptable- allowing for foreseeable loss point x 2
asset values shown in B/S)
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
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June 2003
INTERNATIONAL GCSE
MARK SCHEME
MAXIMUM MARK: 100
SYLLABUS/COMPONENT: 0452/03
ACCOUNTINGPaper 3 (Structured Questions – Extended)
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Page 1 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 3
© University of Cambridge Local Examinations Syndicate 2003
1 (a) Work can be shared between several people.Easier for reference as same type of accounts are kept together.Easier to introduce checking procedures.
Or other suitable point [2]
(b) The names of any two suitable accounts – either real or nominalaccounts – which would appear in the general ledger. (1) each
[2]
(c)Purchases Ledger Control account
$ $2003 2003Apl 30 Purchases Apl 1 Balances b/d 1960
returns 135 (1) 30 Purchases 4190 (1)
Bank 3830 (1)
Discount received 180 (1)
Balances c/d 2005 6150 6150
2003May 1 Balances b/d 2005 (1) O/F
Dates (1) [6]
Sales Ledger Control account
$ $2003 2003Apl 1 Purchases 1750 Apl 1 Balances b/d 100 30 Sales 5150 (1) 30 Sales returns 270 (1)
Bank (refund) 100 (1) Bank 4990 (1)
Discount allowed 110 (1)
Bad debts 74 (1)
Balances c/d 14567000 7000
2003May 1 Balances b/d 1456 (1) O/F
Dates (1) [8]
[Total 18]
Prepared by D. El-Hoss
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Page 2 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 3
© University of Cambridge Local Examinations Syndicate 2003
(c) Alternative presentation –
Purchases Ledger Control account
Dr Cr Balance $ $ $
2003Apl 1 Balances 1960 1960 Cr
30 Purchases 4190 (1) 6150 CrPurchases returns 135 (1) 6015 CrBank 3830 (1) 2185 CrDiscount received 180 (1) 2005 Cr (1) O/F
Dates (1) [6]
Sales Ledger Control account
Dr Cr Balance $ $ $
2003Apl 1 Balances 1750 100 1650 Dr
30 Sales 5150 (1) 6800 Dr Sales returns 270 (1) 6530 DrBank 4990 (1) 1540 Dr Discount allowed 110 (1) 1430 Dr Bank (refund) 100 (1) 1530 Dr Bad debts 74 (1) 1456 Dr (1) O/F
Dates (1) [8]
[Total 18]
Prepared by D. El-Hoss
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Page 3 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 3
© University of Cambridge Local Examinations Syndicate 2003
2 (a)
Amir SadiqTrading and Profit and Loss Account for the year ended 31 March 2003
$ $ $Sales 92100 (1)
Less Sales returns 1200 (1) 90900Less Cost of Sales -
Opening stock 9900 (1)
Purchases 68500 (1)
Less goods for own use 300 (1) 68200Carriage inwards 700 (1)
78800Less Closing stock 10200 (1) 68600 (1)
Gross Profit 22300 (1) O/F
Discount received 250 (1)
Reduction in provision for doubtful debts 50 (1) 300 22600
Motor vehicle expenses 1240
(1)
General expenses 2030Wages 11940 + 1080 13020 (1)
Insurance 1470 - 210 1260 (1)
Depreciation -Motor vehicles 20% x 4750 950 (1)
Fixtures and equipment 3400 - 2800 600 (1) 19100Net Profit 3500 (1) O/F
[17]
Horizontal presentation acceptable.
Prepared by D. El-Hoss
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Page 4 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 3
© University of Cambridge Local Examinations Syndicate 2003
(b) Cost of goods sold = 68600 O/F = 6.83 times (1) O/F
Average stock 10050[2]
(c) (i) Accounts are prepared on the basis that the business will continue tooperate for an indefinite period of time.
[2]
(ii) Lower of cost and net realisable value.[1]
[Total 22]
Prepared by D. El-Hoss
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Page 5 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 3
© University of Cambridge Local Examinations Syndicate 2003
3 (a)Mary
Bank Reconciliation Statement as at 31 January 2003
Balance as per cash book (1780) (1)
Plus cheque not yet presented – David 270 (1)
(1510)Less amount not yet credited 800 (1)
Balance as per bank statement (2310) (1)
[4]
(b) (i)
$ $Current AssetsStock 6600Debtors 5400Insurance prepaid 120Cash 240 12360
Current LiabilitiesCreditors 4620Rent received in advance 160Bank overdraft 1780General expenses accrued 700 7260
Working capital 5100 (1) O/F
Any 2 correct items (1)[5]
(ii) 1. Current ratio
12360 O/F : 7260 O/F (1) = 1.70: 1 (1) O/F
[2]
2. Quick ratio
(12360 O/F - 6600) : 1260 O/F (1) = 0.79: 1 (1) O/F
[2]
Prepared by D. El-Hoss
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Page 6 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 3
© University of Cambridge Local Examinations Syndicate 2003
(c) (i) May have problems paying debts as they fall dueMay not be able to take advantage of cash discountsCannot make the most of opportunities as they occurDifficulties in obtaining further supplies
Or other suitable pointsAny two suitable points – (2) each
[4]
(ii) Injection of more capitalLong-term loansSale of surplus fixed assetsReduce drawings
Or other suitable pointsAny two suitable points – (2) each
[4]
[Total 21]
Prepared by D. El-Hoss
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Page 7 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 3
© University of Cambridge Local Examinations Syndicate 2003
4 (a) April 1 SalesSuzi sold goods, $10100, on credit to John Karunda.
(2)
April 30 BankJohn paid $1000 to Suzi by cheque.
(2)
May 6 Bank (dishonoured cheque)John's cheque was dishonoured by the bank. The amount wasdebited to John's account to show he still owes this amount.
(2)
December 1 CashJohn paid $850 in cash to Suzi.
(2)
January 3 Bad debtsSuzi wrote off the amount owed by John as a bad debt.
(2)
[10]
(b) Provision for doubtful debts account
$ $2003 2002Jan 31 Balance c/d 800 (2) Feb 1 Balance b/d 900 (1)
Profit and Loss 100 (1) O/F
900 900
2003Feb 1 Balance b/d 800 (1) O/F
Dates (1) [6]
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Page 8 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 3
© University of Cambridge Local Examinations Syndicate 2003
Alternative presentation –
Provision for doubtful debts account
2002Feb 1 Balance
2003Jan 31 Profit and Loss
Dr$
100 (1) O/F
Cr$
900
Balance$
900 Cr (1)
800 Cr (3) C/F
(1) O/F
Dates (1) [6]
(c) Obtain references from new credit customersFix a credit limit for each customerIssue invoices and statements promptlyFollow up overdue accounts promptly Supply goods on a cash basis onlyRefuse further supplies until outstanding account is paid
Or other suitable pointsAny 4 suitable points – (1) each
[4]
[Total 20]
Prepared by D. El-Hoss
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Page 9 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 3
© University of Cambridge Local Examinations Syndicate 2003
5 (a)
Cobbydale Sports ClubIncome and Expenditure Account for the year ended 30 April 2003
$ $IncomeSubscriptions (6800 + 300) 7100 (1)
Open day - Ticket sales 3250 Less expenses 1950 1300 (2)
8400ExpenditureGeneral expenses 1430 (1)
Insurance 670 Rent of premises (2420 + 220) 2640 (1)
Depreciation - Equipment 550 (1) 5290 Surplus for the year 3110 (1) O/F
[7]Horizontal presentation acceptable.
(b) (i) EitherLoan from memberThis is not regarded as income for the year as it represents a long-term liability.OrPurchase of equipmentThis is not regarded as revenue expenditure as it is the purchase of afixed asset.OrClosing bank balance
This is neither income nor expenditure for the year as it representsthe amount of money in the bank on 30 April.
[2]
(ii) EitherSubscriptions owing Or Rent owingIn each case the item represents an amount relating to the current yearwhich has not actually been received/paid. The matching principle must beapplied so that the amount relates to the current period of time.OrDepreciation of equipmentThis is a non-monetary expense but must be taken into account incalculating the surplus/deficit for the period so that the matching principle isapplied.OrSurplus for the year
This is the difference between the income and expenditure and is the ‘profit’for the year and does not represent money paid/received.
[2]
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Page 10 Mark Scheme Syllabus Paper
IGCSE EXAMINATIONS – JUNE 2003 0452 3
© University of Cambridge Local Examinations Syndicate 2003
(c)Cobbydale Sports Club
Balance Sheet as at 30 April 2003
$ $ $ Fixed Assets Cost Depreciation to Book value
dateEquipment 3500 (1) 550 (1) O/F 2950 (1) O/F
Current AssetsSubscriptions due 300 (1)
Bank 1080 (1)
1380Current LiabilitiesAccrual – Rent 220 (1) 1160
4110Accumulated FundSurplus for the year 3110 (1) O/F
Long-Term LiabilitiesLoan* 1000 (1)
4110
* Alternatively, allow as current liability as question does not specify date of repayment.[8]
Horizontal presentation acceptable.
[Total 19]
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Grade thresholds taken for Syllabus 0452 (Accounting) in the June 2003 examination.
minimum mark required for grade:maximummark
availableA C E F
Component 1 40 - 24 18 15
Component 2 90 78 63 46 34
Component 3 100 73 49 - -
The threshold (minimum mark) for B is set halfway between those for Grades A and C.The threshold (minimum mark) for D is set halfway between those for Grades C and E.The threshold (minimum mark) for G is set as many marks below the F threshold as the Ethreshold is above it.Grade A* does not exist at the level of an individual component.
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the June 2004 question papers
0452 ACCOUNTING
0452/01 Paper 1 (Multiple Choice), maximum mark 40
0452/02 Paper 2 (Structured Questions), maximum mark 90
0452/03 Paper 3 (Structured Questions – Extended), maximum mark 100
These mark schemes are published as an aid to teachers and students, to indicate the requirements of the examination. They show the basis on which Examiners were initially instructed to award marks. They do not indicate the details of the discussions that took place at an Examiners’ meeting before marking began. Any substantial changes to the mark scheme that arose from these discussions will be recorded in the published Report on the Examination. All Examiners are instructed that alternative correct answers and unexpected approaches in candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills demonstrated. Mark schemes must be read in conjunction with the question papers and the Report on the
Examination.
• CIE will not enter into discussion or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the June 2004 question papers for most IGCSE and GCE Advanced Level syllabuses.
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Grade thresholds taken for Syllabus 0452 (Accounting) in the June 2004 examination.
minimum mark required for grade: maximum mark
available A C E F
Component 1 40 - 24 18 15
Component 2 90 80 66 46 32
Component 3 100 72 48 - -
The threshold (minimum mark) for B is set halfway between those for Grades A and C. The threshold (minimum mark) for D is set halfway between those for Grades C and E. The threshold (minimum mark) for G is set as many marks below the F threshold as the E threshold is above it. Grade A* does not exist at the level of an individual component.
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June 2004
INTERNATIONAL GCSE
MARK SCHEME
MAXIMUM MARK: 40
SYLLABUS/COMPONENT: 0452/01
ACCOUNTING Paper 1 (Multiple Choice)
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Page 1 Mark Scheme Syllabus Paper
ACCOUNTING – JUNE 2004 0452 1
© University of Cambridge International Examinations 2004
Question Number
Key Question Number
Key
1 B 21 A
2 B 22 B
3 B 23 B
4 A 24 D
5 C 25 B
6 B 26 A
7 A 27 B
8 B 28 C
9 C 29 A
10 A 30 A
11 B 31 A
12 A 32 A
13 B 33 C
14 B 34 A
15 B 35 A
16 D 36 D
17 A 37 A
18 B 38 C
19 B 39 D
20 B 40 D
TOTAL 40
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June 2004
INTERNATIONAL GCSE
MARK SCHEME
MAXIMUM MARK: 90
SYLLABUS/COMPONENT: 0452/02
ACCOUNTING Paper 2 (Structured Questions)
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Page 1 Mark Scheme Syllabus Paper
ACCOUNTING – JUNE 2004 0452 2
© University of Cambridge International Examinations 2004
Question Number
Part Mark
1 (a) Machinery, equipment, premises, motor vehicles, or acceptable alternatives
1
(b) (i) Invoice 1 (ii) Purchases Journal/Purchases Day Book/Purchases Book/Purchases 1 (iii) Sales Ledger/Sales 1 (c) (i) $
Cost 46000
- scrap value )1(80005
40000)1(6000==
2
(ii) OF
)1%(20100
)1(40000
8000=× 2
(d) Use of incorrect figure in first place, with double entry carried out
correctly for wrong amount. (Suitable example acceptable.) 1
(e) Customer is in same type of trade; for bulk purchases, or acceptable
alternative. Accept: To enable customer to make profit. 1
(f) Suspense account. 1 (g) ROCE (or N.P. as %age of capital employed); GP: sales; NP: sales.
Gross profit margin, Net profit margin. 1
(h) $ Paid in year 18000 + Balance at 31/3/04 4000 (1) 22000 - Balance at 1/4/03 3000 (1) P/L charge 19000 (1) 3 15
Question Number
Part Mark
2 (a) (i) $25000 (1) (ii) Assets (1) (iii) $3000 (1) (iv) Creditors (1) (v) Capital (1) (vi) $20000 (1) (vii) Drawings (1) 7 (b) (i)
)1(1:2)1(20000
40000$ = 2
(ii) )1(1:8.0)1(
)1(20000
2400040000$ =
−
Must be shown as ratio n:1
3
12
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Page 2 Mark Scheme Syllabus Paper
ACCOUNTING – JUNE 2004 0452 2
© University of Cambridge International Examinations 2004
Question Number
Part Mark
3 (a) (i) Purchases account
$ 30 April 2004 Purchases for month 50000 (1) Total/Purchases Journal Purchases Day Book/Creditors
Purchases returns account $ 30 April 2004 Returns for month 6000 (1) (accept as above)
Sales account $ 30 April 2004 Sales for month 85000 (1) (accept as above)
Sales returns account $ 30 April 2004 Returns for month 8000 (1) (accept as above) 4 Marks are for details and correct amount in correct column. (Horizontal format also acceptable)
Lose 1 mark for any wrong or missing date
(ii) Nominal (General) Ledger 1 (b) 1. Carriage inwards is added to cost of Purchases/Cost of Goods sold (1) in
the Trading A/c/Trading and Profit and Loss A/c (1)
2. Carriage outwards is shown as an expense (1) in the P/L A/c/Trading and Profit and Loss A/c (1)
4
(c) (i) Error of principle 1 (ii) Effect on: 1. P/L Account Purchases/Cost of Goods sold are overstated (1), so Gross profit/Net
Profit/Profit is understated (1)
2. Balance Sheet Office equipment/fixed assets is understated (1) Capital/Net profit/profit is understated (1) 4 (iii) DR CR $ $ Office equipment (machinery) 10000 (1) Purchases 10000 (1) 2 16
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ACCOUNTING – JUNE 2004 0452 2
© University of Cambridge International Examinations 2004
Question Number
Part Mark
4 (a) (i) Debtors $ $ Balances at 1/4/03 8000 (1) Add Sales for year 90000 (1) 98000 Less Cash received 83000 (1) Discount allowed 5000 (1) 88000 Balances at 31/3/04 10000 (1) (ii) Creditors Balances at 1/4/03 6000 (1) Add Purchases for year 77000 (1) 83000 Less Cash paid 74000 (1) Discount received 3000 (1) 77000 Balances at 31/3/04 6000 (1) 10 (b) Trading Account for the year ended 31 March, 2004 (1) (1) $ $ Sales (90000 + 10000) 100000 Less Cost of goods sold Stock 1/4/03 14000 (1) Add Purchases 77000 (1) 91000 Less Stock 31/3/04 16000 (1) 75000 (1) Needs words
"Cost of Goods
Sold"
Gross Profit 25000 (1)OF 7 (Horizontal format also acceptable) (1) OF = 5 times (1) OF
(c) (i)
15000
75000
(2) (ii) Any
one of: Profitability aspect Stock replacement Comparisons Identifying causes of fluctuationsRemedial/corrective action
Basic statement = 1 Suitable development = 1 Max. mark 2 2
23
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ACCOUNTING – JUNE 2004 0452 2
© University of Cambridge International Examinations 2004
Question Number
Part Mark
5 (a) (i) Wood and Coe
Profit and Loss account for the year ended 30 April 2004 $ $ Gross profit 58000 Add Discount received 1000 (1) 59000 Less Discount allowed 2000 (1) General expenses (4500 (1) + 500 (1)) 5000 Rent (13000 (1) – 3000 (1)) 10000 Depreciation (20% x $40000) 8000 (2) Wages and salaries (14500 (1) + 1500 (1)) 16000 41000 Net profit c/d 18000 (1)OF 11 (Horizontal format also acceptable) (ii) Appropriation Account for the year ended 30 April 2004 $ $ $ Net profit b/d 18000 Less Interest on capital: Wood (10% x $70000) 7000 (2) Coe (10% x $20000) 2000 (2) 9000 Salary – Coe 15000 (1) 24000 (no mark if shown in P/L A/c) (6000) Shares of loss: Wood
32 4000 (2)OF
Coe 3
1 2000 (2)OF 6000
- 9 (Horizontal format also acceptable) (b) Interest on drawings discourages large or early cash withdrawals (2)
Thus could improve cash/working capital position (2) Also produces additional residual income/profits for division between partners (2) Any 2 from 3, maximum 4.
4
24
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June 2004
INTERNATIONAL GCSE
MARK SCHEME
MAXIMUM MARK: 100
SYLLABUS/COMPONENT: 0452/03
ACCOUNTING Paper 3 (Structured Questions – Extended)
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ACCOUNTING – JUNE 2004 0452 3
© University of Cambridge International Examinations 2004
Question 1 (a) Insurance account
2003 $ April 1 Balance 60 (1) July 1 Bank 264 (1)
324 2004
April 1 Balance b/d 66 (1) O/F
2004 $ Mar 31 Profit & Loss 258 (1)O/F Balance c/d 66 (1) 324
+ (1) Dates [6] Alternative presentation Insurance account
2003 April 1 Balance July 1 Bank 2004 Mar 31 Profit & Loss
Debit $ 60 (1) 264 (1)
Credit $ 258 (1) O/F
Balance $ 60 Dr 324 Dr 66 Dr (2)C/F (1)O/F
+ (1) Dates [6] (b) (i) A narrative is a brief explanation of why the entry is being made. [1] (ii) A narrative is necessary because of the great variety of transactions
which are recorded in the journal, so the reason for each entry can be understood in the future.
[2]
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ACCOUNTING – JUNE 2004 0452 3
© University of Cambridge International Examinations 2004
(c)
Journal
1. 2. 3.
Drawings Purchases Goods taken for own use (1)
Motor vehicles Motor expenses PJ Motors Purchase of new motor on credit and repairs to old motor (1) Stationery Purchases Correction of error, stationery debited to purchases account (1)
Debit $
60 (1) 15 000 (1) 600 (1) 20 (1)
Credit $ 60 (1) 15 600 (1) 20 (1)
[10] [Total 19] Question 2 (a)
Playground Company
Manufacturing Account for the year ended 31 December 2003
$ $ Cost of raw material Purchases 48 500 (1) Less Closing stock of raw material 2 700 (1) 45 800 Direct factory wages (26900 + 650) 27 550 (1) Prime Cost (1) 73 350 (1) Factory indirect wages 18 400 Factory general expenses 4 930 Factory fuel and power (4700 + 150) 4 850 (1) Depreciation – Factory machinery 1 450 (1) 29 630 102 980 (1) O/F Less Closing stock of work in progress 1 920 (1) Cost of Production(1) 101 060 (1) O/F [12] Horizontal format acceptable
(1)
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ACCOUNTING – JUNE 2004 0452 3
© University of Cambridge International Examinations 2004
(b)
Playground Company
Trading Account for the year ended 31 December 2003
$ $ Sales 151 400 (1) Less Cost of sales Cost of Production 101 060 (1) O/F Less Closing stock of finished goods 4 910 (1) 96 150 (1) O/F Gross Profit 55 250 (1) O/F [5] Horizontal format acceptable (c) Reasons why departmental final accounts are required - More meaningful than a single set of results Identifies the profit of each department Enables trading results to be analysed Enables overall profitability to be increased Poor performance of a department can be identified and investigated Or other suitable points Any 2 points (1) each [2] [Total 19] Question 3 (a) When suspense account is required –
When a trial balance fails to balance [1] (b) The second error requires a correcting entry in the suspense account (1) This is required because this error affects the balancing of the trial balance (2) [3]
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ACCOUNTING – JUNE 2004 0452 3
© University of Cambridge International Examinations 2004
(c)
Mary Manake
Balance Sheet as at 30 April 2004
$ $ $ Fixed Assets At cost (40000 – 5000) 35 000 (1) Less Depreciation (8000 – 500) 7 500 (1) 27 500 Current Assets Stock 8 500 Debtors 6 100 Prepayments 30 (1) 14 630 (1)O/F Current Liabilities Creditors 5 200 Bank overdraft (2010 + 70) 2 080 (1) 7 280 (1)O/F Working Capital 7 350 (1)O/F 34 850 Capital Balance at 1 May 2003 34 000 Net Profit (8440 + 30 – 70 + 150 – 400) 8 150 (1) (1) (1) (2) 42 150 Drawings 7 300 34 850 (1)O/F Presentation (1) Horizontal presentation acceptable [14] [Total 18] Question 4 (a) Reason for providing a provision for doubtful debts – Ensures that the profits are not overstated (prudence) Ensures that the debtors are shown in the Balance Sheet at a more realistic amount (prudence) Application of the matching principle as the amount of sales unlikely to be paid for are treated as an expense of that particular year Or other suitable reason. Any one reason (2) marks [2]
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ACCOUNTING – JUNE 2004 0452 3
© University of Cambridge International Examinations 2004
(b) (i) Ahmed account
[3] (ii)
Bad debts account
[2] (iii)
Bad debts recovered account
2004 $ Mar 31 Profit & Loss* 50(1) 50
2003 $ Sept 1 Cash** 50(1) 50
*Alternatively transfer to Bad debts account, in which case the transfer from Bad debts account to Profit & Loss Account will be $30 on the debit side of Bad debts account
** Alternatively allow “Zaki”, as may be using method where the amount is credited to customer’s account and then debited and transferred to bad debts recovered account [2]
(iv) Provision for doubtful debts account
2004 $ Mar 31 Profit & Loss 50(2) Balance c/d 200(1) 250
2003 $ April 1 Balance b/d 250(1) ___ 250 2004 April 1 Balance b/d 200(1) O/F
[5]
[12]
2003 $ May 1 Sales 100(1) __ 100
2003 $ July 31 Bank 80(1) 2004 Jan 31 Bad debts 20(1) 100
2004 $ Jan 31 Ahmed 20(1) 20
2004 $ Mar 31 Profit & Loss 20(1) 20
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ACCOUNTING – JUNE 2004 0452 3
© University of Cambridge International Examinations 2004
(b) Alternative presentation
(i) Ahmed account
2003 May 1 Sales July 31 Bank 2004 Jan 31 Bad debts
Debit $ 100(1)
Credit $ 80(1) 20(1)
Balance $ 100 Dr 20 Dr 0
[3]
(ii) Bad debts account
2004 Jan 31 Ahmed Mar 31 Profit & Loss
Debit $
20(1)
Credit $
20(1)
Balance $
20 Dr 0
[2]
(iii) Bad debts recovered account
2003 Sept 1 Cash** 2004 Mar 31 Profit & Loss*
Debit $ 50(1)
Credit $ 50(1)
Balance $ 50 Cr 0
*Alternatively transfer to Bad Debts account, in which case the transfer from Bad debts account to Profit & Loss Account will be $30 on the debit side of Bad debts account
** Alternatively allow “Zaki”, as may be using method where the amount is credited to customer’s account and then debited and transferred to bad debts recovered account
[2]
(iv) Provision for doubtful debts account
2003 April 1 Balance 2004 Mar 31 Profit & Loss
Debit $ 50(2)
Credit $ 250(1)
Balance $ 250 Cr 200 Cr (2) C/F (1) O/F
[5]
[12]
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ACCOUNTING – JUNE 2004 0452 3
© University of Cambridge International Examinations 2004
(c) (i) Write Zanetti’s account off as a bad debt (1) Amount now outstanding for over 1 year with little hope of recovery (1) Or other acceptable explanation (ii) No entries in accounting records are necessary (1) Account is still likely to be paid, there is no evidence yet that it will not be paid by Lim (1) Or other acceptable explanation (iii) Create a provision for doubtful debts of $280 (1)
Must ensure that he does not overstate his net profit for the year (1) Or other acceptable explanation [6] [Total 20]
Question 5 (a) (i) Margin – when the gross profit is expressed as a percentage of the selling price [2] (ii) Mark-up – when the gross profit is expressed as a percentage of the cost price [2]
(b) (i) [6]
Year ended 31 January 2004
Gross profit as a percentage of sales 25200 x 100 = 28% (1) 90000 1 Net profit as a percentage of sales 10800 x 100 = 12% (1) 90000 1 Collection period for debtors 6300 x 365 = 35 days (1) 66000(1) 1 (34.84 days) Payment period for creditors 5700 x 365 = 40 days (1) 52000(1) 1
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ACCOUNTING – JUNE 2004 0452 3
© University of Cambridge International Examinations 2004
(b) (ii) All responses to be based on own figure calculations in (b) (i) Gross profit as a percentage of sales – Purchasing goods more cheaply Reducing trade discounts to customers Increasing selling prices Net profit as a percentage of sales- Increase in gross profit percentage Reduction in expenses Differences in types of expenses (fixed/variable) Collection period for debtors – Less efficient credit control Allowing longer credit to maintain sales Not allowing cash discounts to debtors Payment period for creditors – Shortage of liquid funds Knock-on effect of debtors taking longer to pay Suppliers not allowing cash discounts
In each case other suitable points acceptable
In each case – any 2 points (1) each [8] (c) Interested parties – Zaraki (Proprietor) - Assessment of past performance Planning for the future Identifying areas where corrective action is required Manager (if any) – Assessment of past performance Planning for the future Identifying areas where corrective action is required Bank manager – Assessment of prospects of any requested loan/overdraft being repaid when due Assessment of prospects of any interest on loan/overdraft being paid when due Assessment of the security available to cover any loan/overdraft Lenders – Assessment of prospects of any requested loan being repaid when due Assessment of prospects of interest on loan being paid when due Assessment of the security available to cover the loan
Creditors for goods – Assessment of the liquidity position Identifying how long the business normally takes to pay creditors Identifying future trading prospects of the business
In each case other suitable reasons acceptable
Three parties to be identified – (1) each giving a total of (3) One reason required in each case – (1) giving a total of (3) [6]
[Total 24]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the June 2005 question paper
0452 ACCOUNTING
0452/01 Paper 1 (Multiple Choice), maximum raw mark 40
Mark schemes must be read in conjunction with the question papers and the Report on the
Examination.
• CIE will not enter into discussion or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the June 2005 question papers for most IGCSE and GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses’.
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Grade thresholds for Syllabus 0452 (Accounting) in the June 2005 examination.
Minimum mark required for grade
Minimum mark
available A C E F
Component 1 40 N/A 22 17 14
The threshold (minimum mark) for B is set halfway between those for Grades A and C. The threshold (minimum mark) for D is set halfway between those for Grades C and E. The threshold (minimum mark) for G is set as many marks below F threshold as the E threshold is above it. Grade A* does not exist at the level of an individual component.
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JUNE 2005
IGCSE
MARK SCHEME
MAXIMUM MARK: 40
SYLLABUS/COMPONENT: 0452/01
ACCOUNTING Paper 1 (Multiple Choice)
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IGCSE – JUNE 2005 0452 1
© University of Cambridge International Examinations 2005
Question Number
Key Question Number
Key
1 B 21 D
2 C 22 D
3 A 23 A
4 A 24 A
5 A 25 C
6 C 26 B
7 D 27 A
8 A 28 B
9 B 29 A
10 C 30 D
11 D 31 B
12 D 32 C
13 A 33 C
14 C 34 D
15 C 35 B
16 A 36 A
17 A 37 B
18 D 38 C
19 B 39 B
20 A 40 D
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the June 2005 question paper
0452 ACCOUNTING
0452/02 Paper 2, maximum raw mark 90
This mark scheme is published as an aid to teachers and students, to indicate the requirements of the examination. It shows the basis on which Examiners were initially instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began. Any substantial changes to the mark scheme that arose from these discussions will be recorded in the published Report on the Examination. All Examiners are instructed that alternative correct answers and unexpected approaches in candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills demonstrated. Mark schemes must be read in conjunction with the question papers and the Report on the
Examination.
• CIE will not enter into discussion or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the June 2005 question papers for most IGCSE and GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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Grade thresholds for Syllabus 0452 (Accounting) in the June 2005 examination.
Minimum mark required for grade: Maximum mark
available A C E F
Component 2 90 73 58 39 30
The threshold (minimum mark) for B is set halfway between those for Grades A and C. The threshold (minimum mark) for D is set halfway between those for Grades C and E. The threshold (minimum mark) for G is set as many marks below F threshold as the E threshold is above it. Grade A* does not exist at the level of an individual component.
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June 2005
IGCSE
MARK SCHEME
MAXIMUM MARK: 90
SYLLABUS/COMPONENT: 0452/02
ACCOUNTING Paper 2
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Page 1 Mark Scheme Syllabus Paper
IGCSE – JUNE 2005 0452 2
© University of Cambridge International Examinations 2005
Question number
Question (including any source details) Part mark
1 (a)
(b) (c) (d) (e) (f) (g) (h)
Cash book, Sales journal, Purchases journal, Sales returns journal, Purchases returns journal, Journal, Petty cash book (any two). An expense incurred in the accounting period but unpaid at the end of the period. Current liabilities. Suspense account. Profit and Loss Account. Error of original entry. Business will continue trading for the foreseeable future. (i) $1,800
(ii) $1,800
(iii) $8,400
(iv) Dr Cr $ $ Profit and Loss Account (accept Depreciation account)
1 800 (1)OF
Provision for depreciation
1 800 (1)OF
[2]
[1]
[1]
[1]
[1]
[1]
[1]
[1]
[1]
[1]
[2]
[Total: 13]
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IGCSE – JUNE 2005 0452 2
© University of Cambridge International Examinations 2005
Question number
Question (including any source details) Part mark
2 (a) (b)
Bonnie Clyde Balance Sheet at 31 March 2005
$ $
Fixed Assets Machinery at cost 20 000 (1) Provision for depreciation 12 000 (1) Net book value 8 000 (1) Current Assets Stock 3 000 (1) Debtors 1 000 (1) Bank 500 (1) 4 500 Current Liabilities Creditors 700 (1) Working capital 3 800 11 800 Long term Liability Bank loan (accept if under capital) 2 800 (1) 9 000 Capital Balance at 1 April 2004 6 000 (1) Profit for the year 7 500 (1) 13 500 less drawings 4 500 (1)
9 000 (1) for matching
totals
[Horizontal format acceptable] (i) Current assets less current liabilities (1) Capital needed for day to day running of business (1) (ii) Working capital
$4 500 (1OF) less $700 (1)OF = $3 800 (1)
[12]
[4]
[Total: 16]
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IGCSE – JUNE 2005 0452 2
© University of Cambridge International Examinations 2005
Question number
Question (including any source details) Part mark
3 (a) (b)
(c)
Zafira Cash Book
Dr Cr $ $
Balance b/d 620 (1) Bank charges 15 (1) Bank interest 20 (1) Insurance (D/debit) 40 (1) Aisha 130 (1) Dishonoured cheque, (credit transfer) Yanni (either) 65 (1)
Balance c/d 770
650
770 Balance b/d 650 (1)OF [Running balance acceptable] Bank reconciliation statement at 30 April 2005 Balance on updated cash book (from (a) above)
650 (1)OF
Adjustments: add: unpresented cheque 250
900 (1)
less: amount not yet credited 310 (1) Balance on bank statement 590 (2) [Amounts must have narrative] (1)OF
Incorrect entry in cash book Transposition of figures in cash book Addition error on cash book page Item on bank statement omitted from cash book - or similar explanations [Any two - 2 marks each]
[Repeating part (b) = 0]
[7]
[5]
[4]
[Total: 16]
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Page 4 Mark Scheme Syllabus Paper
IGCSE – JUNE 2005 0452 2
© University of Cambridge International Examinations 2005
Question number
Question (including any source details) Part mark
4 (a) (b)
Redd - Purchases Ledger
Block account 2005 $ 2005 $ 8 March Purchases
returns 100 (1) 5 March Purchases 320 (1)
30 March Bank 220 (1) 29 March Purchases 270 (1) 31 March Balance c/d 270 (1) 590 590 1 April Balance
b/d 270
(1)OF
Quayle account 2005 $ 2005 $ 31 March Bank
Discount 485 15 500
(1) (1)
17 March Purchases 500 500
(1)
+ (1) for all dates
[need not show year] [Running balance acceptable]
Rent account
2004
2 April Bank 900 (1) 2 July Bank 700 (1) 31 July Bank 200 30 Sept Bank 900 2005 (1) 2005 4 Jan Bank 900 31 March P/L Account 3 600 (1) 29 March Bank 800 (1) Balance c/d 800 (1) 4 400 4 400 1 April Balance b/d 800 (1)OF [Must have narrative]
[Running balance acceptable] + (1) for all dates
[10]
[8]
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IGCSE – JUNE 2005 0452 2
© University of Cambridge International Examinations 2005
Question number
Question (including any source details) Part mark
(c) 5 (a) (b)
(i) Costs should be offset against revenues from the same accounting period. (2) Accept example.
(ii) The rent paid in advance on 29 March 2005 relates to the
following accounting year and is therefore subtracted from the amount charged to Profit and Loss Account for the year ended 31 March 2005. (2)
$ Total bank deposits 15 270 Less: cash sales 2 680 (1)
12 590 less: Debtors at 1 April 2004 3 140 (1)
9 450 add: Debtors at 31 March 2005 4 080 (1) Credit sales for year 13 530 (1) [Amounts need narrative]
William Trading and Profit and Loss Account
for the year ended 31 March 2005
$ $ Sales -credit 13 530 (1)OF -cash 2 680 (1) 16 210 Stock at 1 April 2004 1 780 (1) Purchases 9 560 (1) Carriage inwards 280 (1) 11 620 Stock at 31 March 2005 1 920 (1) Cost of goods sold 9 700 (1) Gross profit 6 510 (1)OF Rent 600 Electricity 360 Motor expenses 800 (2) * Insurance 580 Wages 1 370
3 710 Net profit 2 800 (1)OF
* 5 items = 2 marks 1 error = 1 mark 2 errors = 0 marks Error = wrong figure, alien or omission
[4]
[Total: 22]
[4]
[11]
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Page 6 Mark Scheme Syllabus Paper
IGCSE – JUNE 2005 0452 2
© University of Cambridge International Examinations 2005
Question number
Question (including any source details) Part mark
(c) (d)
Gross profit/Sales x 100 6 510 (1)OF/16 210 (1)OF x 100 = 40.16% (1)OF (i) Gross profit increased (1) by $90(1) (ii) Revised gross profit percentage: 6 600 (1)OF/16 300 (1)OF x 100 = 40.49% (1)OF
[3]
[2]
[3]
[Total: 23]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the June 2005 question paper
0452 ACCOUNTING
0452/03 Paper 3, maximum raw mark 100
This mark scheme is published as an aid to teachers and students, to indicate the requirements of the examination. It shows the basis on which Examiners were initially instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began. Any substantial changes to the mark scheme that arose from these discussions will be recorded in the published Report on the Examination. All Examiners are instructed that alternative correct answers and unexpected approaches in candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills demonstrated. Mark schemes must be read in conjunction with the question papers and the Report on the
Examination. • CIE will not enter into discussion or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the June 2005 question papers for most IGCSE and GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses’.
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
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Grade thresholds for Syllabus 0452 (Accounting) in the June 2005 examination.
Minimum mark required for grade: Maximum mark
available A C E F
Component 3 100 71 44 N/A N/A
The threshold (minimum mark) for B is set halfway between those for Grades A and C. The threshold (minimum mark) for D is set halfway between those for Grades C and E. The threshold (minimum mark) for G is set as many marks below F threshold as the E threshold is above it. Grade A* does not exist at the level of an individual component.
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JUNE 2005
IGCSE
MARK SCHEME
MAXIMUM MARK: 100
SYLLABUS/COMPONENT: 0452/03
ACCOUNTING Paper 3
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IGCSE – JUNE 2005 0452 3
© University of Cambridge International Examinations 2005
Question 1 (a) Current Accounts
James Susan James Susan
$ $ $ $
2004 2004
May 1 Balance b/d 400 May 1 Balance b/d 2 000
2005 2005
Apl 30 Drawings 6 000 10 000(1) Apl 30 Interest on capital 1 050 600(1)
Interest on drawings 300 500(1) Partner’s salary 7 000(1)
Balance c/d 3 350(1) Share of profit 4 250 4 250(1)
Balance c/d 1 400(1)
6 700 13 850 6 700 13 850
2005 2005
May 1 Balance b/d 1 400 May 1 Balance b/d 3 350
(1)O/F (1)O/F
The marks for interest on capital, profit shares, drawings, and interest on drawings are for both
figures Alternatively allow two separate “T” accounts [9] Alternative presentation
James Current Account Debit Credit Balance $ $ $ 2004 May 1 Balance 400 400 Dr 2005 Apl 30 Drawings 6 000 6 400 Dr Interest on drawings 300 6 700 Dr Interest on capital 1 050 5 650 Dr Share of profit 4 250 1 400 Dr (2)C/F (1)O/F
Susan Current Account
Debit Credit Balance $ $ $ 2004 May 1 Balance 2 000 2 000 Cr 2005 Apl 30 Drawings 10 000 8 000 Dr Interest on drawings 500 8 500 Dr Interest on capital 600 7 900 Dr Partner’s salary 7 000 (1) 900 Dr Share of profit 4 250 3 350 Cr (2)C/F (1)O/F
Drawings (1) for both figures Interest on drawings (1) for both figures Interest on capital (1) for both figures Profit shares (1) for both figures [9]
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IGCSE – JUNE 2005 0452 3
© University of Cambridge International Examinations 2005
(b) Capital Accounts James Susan Anna James Susan Anna $ $ $ $ $ $ 2005 2005 May 1 Goodwill 8 000 (1) 2 000 (1) 2 000 (1) May 1 Balance b/d 35 000 (1) 20 000 (1) Balance c/d 33 000 (1) 24 000 (1) 24 000 (1) Bank 26 000 (1) Goodwill 6 000 (1) 6 000 (1) 41 000 26 000 26 000 41 000 26 000 26 000 2005 May 2 Balance b/d 33 000 24 000 24 000 (1)O/F (1)O/F (1)O/F
Alternatively allow three separate “T” accounts [14] Total [23]
Alternative presentation
James Capital Account Debit Credit Balance $ $ $ 2005 May 1 Balance 35 000 (1) 35 000 Cr Goodwill 6 000 (1) 41 000 Cr Goodwill 8 000 (1) 33 000 Cr (2)C/F (1)O/F
Susan Capital Account
Debit Credit Balance $ $ $ 2005 May 1 Balance 20 000 (1) 20 000 Cr Goodwill 6 000 (1) 26 000 Cr Goodwill 2 000 (1) 24 000 Cr (2)C/F (1)O/F
Anna Capital Account
Debit Credit Balance $ $ $ 2005 May 1 Bank 26 000 (1) 26 000 Cr Goodwill 2 000 (1) 24 000 Cr (2)C/F (1)O/F
[14] Total [23]
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IGCSE – JUNE 2005 0452 3
© University of Cambridge International Examinations 2005
Question 2 (a) To ensure no transactions are forgotten/overlooked (not relying on human memory) To enable profit to be calculated To enable the financial position of the business to be ascertained Or other suitable point Any 2 items (1) each [2] (b) The accounting records of a business are maintained from the viewpoint of the business. The business and the owner of the business are regarded as being separate entities.
The personal transactions of the owner of the business are not recorded in the accounting records of the business. Any 2 items (1) each [2]
(c) Jane Joda Trading Account for the year ended 31 March 2005
$ $ $ Sales - Credit 10 900 (1)O/F Cash 6 600 (1) 17 500 Less Cost of sales Opening stock 9 500 (1) Purchases 22 000 (1) 31 500 Less Closing stock 17 500 (1) 14 000 (1)
Gross Profit 3 500 (2)C/F
(1)O/F Horizontal format acceptable [8] (d) (i) Comparison with the results of other businesses (1) of a similar size/type (1) [2] (ii) Improve profitability Increase sales (in total or of certain products) Review stock levels Direct investment into new areas Or other suitable point Any one point required – (1) for basic point (1) for suitable development [2] (iii) Any two of the following – Information must be - capable of being independently verified free from bias free from significant errors
prepared with suitable caution being applied to any judgements and estimates which are necessary Any two items (2) each [4]
Total [20]
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IGCSE – JUNE 2005 0452 3
© University of Cambridge International Examinations 2005
Question 3 (a) (i) 1 Current ratio $22 000 : $14 500 (1) = 1.52 : 1 (1) 2 Quick ratio ($22 000 – 12 000) : $14 500 (1) = 0.69 : 1 (1) [4] (ii) Quick ratio [1]
Stock is not regarded as a liquid asset – a buyer has to be found and then the money
collected. Some stock may prove to be unsaleable. The quick ratio shows whether the business would have any surplus liquid funds if all the current liabilities were paid immediately from the liquid assets. Any one reason (2) marks [2]
(b) Return on capital employed (using closing capital figure)
1
100
$52500
$4950× (1) = 9.43% (1) [2]
(c) (i) Collection period for debtors
1
365
$69300
$9500× (1) = 50.04 days (51 days) (1) [2]
(ii) 1 Not satisfied – if (c)(i) is more than 30 days
Or – satisfied if (c)(i) is less than 30 days [1] 2 Debtors are allowed 30 days credit but on average are taking 51 days
Or suitable explanation based on O/F answer to (c)(i). [1] (d) (i) Payment period for creditors
1
365
$47600
$6300× (1) = 48.31 days (49 days) (1) [2]
(ii) Advantage of paying creditors before due date –
May be able to take advantage of cash discounts Improves the relationship with suppliers Or other suitable comment One advantage required (1) [1]
(iii) Disadvantage of paying creditors before due date – The business is deprived of the use of the money earlier than necessary Or other suitable comment One disadvantage required (1) [1]
Total [17]
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IGCSE – JUNE 2005 0452 3
© University of Cambridge International Examinations 2005
Question 4
(a) (i) The Income and Expenditure Account is equivalent to a Profit and Loss Account of a trading organisation. (1) It is used to calculate the annual surplus or deficit. (1) Or other suitable points [2]
(ii) The accumulated fund is equivalent to the capital of a trading organisation, the difference between the assets and the liabilities. (1) The annual surpluses (less any deficits) accumulate within a non-trading organisation to form the accumulated fund. (1) [2]
(b) Siltones Music Society Receipts and Payments Account for the year ended 31 March 2005 2004 $ 2005 $
Apl 1 Balance 2 210 (1) Mar 31 Concert expenses 1 250 (1)
2005 Rent 1 820 (1)
Mar 31 Subscriptions 5 800 (1) General expenses 215 (1)
Concert receipts 1 900 (1) Insurance 325 (1)
Proceeds of sale of instruments 700 (1) Purchase of new instruments 3 350 (1)
Balance c/d 3 650
10 610 10 610
2005
Apl 1 Balance b/d 3 650 (1)O/F
[10]
(c) Siltones Music Society Subscriptions account 2004 $ 2005 $ Apl 1 Balance b/d 1000 (1) Mar 31 Bank 5800 (1) 2005 Mar 31 Balance c/d 800 (1) Income and Expenditure (1) 4000 (1) 5800 5800 2005 Apl 1 Balance b/d 800 (1)
Dates (1) [7]
Alternative presentation
Siltones Music Society Subscriptions account Debit Credit Balance $ $ $ 2004 Apl 1 Balance 1000 (1) 1000 Dr 2005 Mar 31 Bank 5800 (1) 4800 Cr Income and Expenditure (1) 4000 (1) 800 Cr (2) Dates (1)
[7]
Total [21]
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IGCSE – JUNE 2005 0452 3
© University of Cambridge International Examinations 2005
Question 5 (a) To make the totals of the trial balance agree (1) and so that draft final accounts may be
prepared. (1) [2]
(b) Ahmed Shafiq Journal Debit Credit $ $ 1. Suspense account 390 (1) Commission received account 390 (1) 2. Mutua account 400 (1) Mutola account 400 (1) Suspense account 800 (1) 3. Stationery account 20 (1) Purchases account 20 (1) 4. Discount allowed account 15 (1) Limo 15 (1) 5. Sales returns account 420 (1) Purchases returns account 240 (1) Suspense account 660 (1)
[12]
(c) Ahmed Shafik Statement of corrected net profit for the year ended 31 January 2005 $ Net profit before corrections
Effect on net profit 16 000
+ – $ $ Error 1 390 2 No effect (1) 3 No effect (1) 4 15 (1) 5 660 (1) 390 675 285
Corrected net profit 15 715 (1) O/F
[5] Total [19]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2006 question paper
0452 ACCOUNTING
0452/01 Paper 1 – Multiple Choice, maximum raw mark 40
These mark schemes are published as an aid to teachers and students, to indicate the requirements of the examination. They show the basis on which Examiners were initially instructed to award marks. They do not indicate the details of the discussions that took place at an Examiners’ meeting before marking began. Any substantial changes to the mark scheme that arose from these discussions will be recorded in the published Report on the Examination. All Examiners are instructed that alternative correct answers and unexpected approaches in candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills demonstrated. Mark schemes must be read in conjunction with the question papers and the Report on the
Examination. The minimum marks in these components needed for various grades were previously published with these mark schemes, but are now instead included in the Report on the Examination for this session.
• CIE will not enter into discussion or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2006 question papers for most IGCSE and GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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© University of Cambridge International Examinations 2006
Question
Number
Key
Question
Number
Key
1 C 21 C
2 D 22 C
3 A 23 D
4 B 24 B
5 C 25 A
6 B 26 B
7 C 27 C
8 B 28 A
9 C 29 D
10 C 30 C
11 B 31 B
12 C 32 D
13 B 33 C
14 A 34 B
15 D 35 A
16 A 36 D
17 B 37 D
18 B 38 A
19 D 39 C
20 C 40 C
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2006 question paper
0452 ACCOUNTING
0452/02 Paper 2, maximum raw mark 90
These mark schemes are published as an aid to teachers and students, to indicate the requirements of the examination. They show the basis on which Examiners were initially instructed to award marks. They do not indicate the details of the discussions that took place at an Examiners’ meeting before marking began. Any substantial changes to the mark scheme that arose from these discussions will be recorded in the published Report on the Examination. All Examiners are instructed that alternative correct answers and unexpected approaches in candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills demonstrated. Mark schemes must be read in conjunction with the question papers and the Report on the
Examination. The minimum marks in these components needed for various grades were previously published with these mark schemes, but are now instead included in the Report on the Examination for this session.
• CIE will not enter into discussion or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2006 question papers for most IGCSE and GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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© University of Cambridge International Examinations 2006
Question Number
Question (including any source details) Part Mark
1 (a) Cash book [1] (b) Matching [1] (c) Fixed assets [1] (d) A transaction completely omitted from the books e.g. cash sales not recorded
[1]
(e) Income Expense Discount received � (1) Carriage outwards � (1) Interest on bank deposit � (1) Bad debt written off � (1) [4]
(f) Interest on capital, partners salaries, interest on drawings (any two) [2] (g) Current assets less current liabilities [2] (h) (i) $200 less $65 = $135 [1] (ii) Missing voucher or $10 lost/pilfered from cash box [2] (i) (i) Current assets less stock/current liabilities [2] (ii) Shows whether the business has sufficient liquid assets to meet its
current liabilities [2]
Total marks [19]
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© University of Cambridge International Examinations 2006
Question Number
Question (including any source details) Part Mark
2 (a) Loretti Journal $ $
Office furniture 1 500 (1) Stock 12 000 (1) Bank 5 300 (2) Cash 200 (1) Loan – Hassan 3 000 (1) Capital – Loretti 16 000 (2) 19 000 19 000
[8] See next page for 2 (b)
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© University of Cambridge International Examinations 2006
Question Number
Question (including any source details) Part Mark
3 (a) Hilota – Trial balance at 31 March 2006 $ $
Fixed assets 22 000 (1) Provision for depreciation 9 300 (1) Stock at 1 April 2005 3 200 (1) Balance at bank 1 550 (1) Sales 56 500 (1) Sales returns 500 (1) Purchases 34 200 (1) Carriage outwards 950 (1) Rent 4 000 Wages 7 200 (1) General expenses 2 600 Capital 20 000 (1) Drawings 9 600 (1) Totals 85 800 85 800 (1) to agree
total
[12] (b) Hilota Trading account for the year ended 31 March 2006 $ $
Sales 56 500 (1) less sales returns 500 (1) 56 000 Opening stock 3 200 (1) Purchases 34 200 (1) 37 400 less closing stock 3 800 (1) Cost of goods sold 33 600 (1) Gross profit 22 400 (1) OF
[7] (c) Gross profit percentage = Gross profit/net sales = 22 400 (1)(OF)/56 000 (1) x 100 = 40.00% (1) [3] (d) If no sales returns, use gross sales: Gross profit percentage = 22 900 (1)(OF)/56 500 (1) x 100 = 40.43% (1) [3] Total marks [25]
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Question Number
Question (including any source details) Part Mark
4 (a) Stock is valued at the lower (1) of cost (1) and net realisable value (1) [3] (b) Rudi- stock valuation $ $
Part A005: 250 (1) units @ $1.30 per unit (1) 325.00 (1) Part B017: 600 (1) units @ $1.80 per unit (2) 1 080.00 (1) Part C060: 150 (1) units @ $2.50 per unit (1) 375.00 (1) add: carriage inwards 3 x $25 = 75.00 (1) 450.00 Total value of stock 1 855.00 (1)
[12] (c) Prudence [2] Total marks [17] 5 (a) Rajit Summary Balance Sheet at 31 December 2005 Cost Provision for
depreciation Net book value
$ $ $ Fixed assets 62 500 (1) 12 500 (1) 50 000 (1) Current assets 47 000 (1) less current liabilities 19 000 (1) Net current assets/working capital 28 000 (1) 78 000 Financed by Capital at 1 January 2005 74 000 (1) Add Profit for the year 13 000 (1) 87 000 less drawings 9 000 (1) 78 000 (1) to agree
balance
[10] (b) Return on capital employed = profit/opening capital = 13 000 (1)/74 000 (1) = 17.57% (1) [3] Total marks [13]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2006 question paper
0452 ACCOUNTING
0452/03 Paper 3, maximum raw mark 100
These mark schemes are published as an aid to teachers and students, to indicate the requirements of the examination. They show the basis on which Examiners were initially instructed to award marks. They do not indicate the details of the discussions that took place at an Examiners’ meeting before marking began. Any substantial changes to the mark scheme that arose from these discussions will be recorded in the published Report on the Examination. All Examiners are instructed that alternative correct answers and unexpected approaches in candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills demonstrated. Mark schemes must be read in conjunction with the question papers and the Report on the
Examination. The minimum marks in these components needed for various grades were previously published with these mark schemes, but are now instead included in the Report on the Examination for this session.
• CIE will not enter into discussion or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2006 question papers for most IGCSE and GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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IGCSE – May/June 2006 0452 03
© University of Cambridge International Examinations 2006
1 (a) Tarek Wahid Cash Book
Date
Details
Discount Allowed
Cash
Bank Date Details Discount Received
Cash Bank
$ $ $ $ $ $ 2006 2006 April 1 Balances b/d 125 6 750 April 5 Asmaa El Zein (dishonoured cheque) (1) 230
10 Mohammed Riyas (1) 12 468 16 Motor vehicle (1) 9 900
29 Sales (1) 2 150 Motor expenses (1) 80
30 Cash (1) 2 175 24 Salma Abbas (1) 14 546 Balance c/d 1 363 30 Bank (1) 2 175 Balance c/d 100 12 2 275 10 756 14 2 275 10 756 May 1 Balance b/d (1) O/F 100 May 1 Balance b/d (1) O/F 1 363
+ (1) Totalling discount columns
[11]
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© University of Cambridge International Examinations 2006
(b) The bank statement is a copy of the account of the business as it appears in the books of the bank. This is from the viewpoint of the bank – the business depositing money is a creditor of the bank.
The bank account in the cash book is prepared from the viewpoint of the business – the bank is a debtor of the business which has deposited the money. [2]
(c) Tarek Wahid
Calculation of bank statement balance at 30 April 2006
$ Balance as per cash book (1363) (1) O/F Plus cheque not yet presented – Salma Abbas 546 (1)
(817) Less amount not yet credited 2175 (1) O/F Balance as per bank statement (2992) (1) O/F
Alternative presentation acceptable [4]
(d) $1363 (1) O/F Liability (1) O/F [2]
[Total 19] 2 (a)
Susan Sawka Purchases Ledger Control account
2006 $ 2006 $ Mar 1 Balance b/d 120 (1) Mar 1 Balance b/d 9 500 (1)
31 Purchases returns 135 (1) 31 Purchases 7 420 (1) Bank 8 780 (1) Discount received 20 (1) Contra item 380 (1) Balance c/d 7 485 (1) O/F 16 920 16 920 April 1 Balance b/d 7 485 (1) O/F
+ (1) for dates [10] Alternative presentation
Susan Sawka Purchases Ledger Control account
Debit Credit Balance
2006 $ $ $ Mar 1 Balances 120 (1) 9 500 (1) 9 380 Cr
31 Purchases 7 420 (1) 16 800 Cr Purchases returns 135 (1) 16 665 Cr Bank 8 780 (1) 7 885 Cr Discount received 20 (1) 7 865 Cr Contra item 380 (1) 7 485 Cr (2) O/F
+ (1) for dates [10]
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© University of Cambridge International Examinations 2006
(b) Reasons for a debit balance Overpayment of amount due Cash discount not deducted before payment made Returned goods after payment of amount due Payment made to creditor in advance Or other suitable point Any 2 points (1) each [2] (c) A purchases ledger control account acts as a check on the purchases ledger. If there is an
error in the purchases ledger it will not be revealed by a control account prepared from the individual accounts in that ledger. [2]
(d) Payment period for creditors 7 485 O/F from (a) x 365 = 30.56 days = 31 days (1) O/F 89 400 (1) 1 [2] (e) 1 Not satisfied – if (d) is more than 14 days (1) Or – satisfied – if (d) is less than 14 days 2 Susan is allowed 14 days credit but is taking an average of 31 days (1) Or suitable explanation based on O/F answer to (d) [2] [Total 18] 3 (a)
Safat Judo Club Income and Expenditure Account for the year ended 31 January 2006
$ $
Income Subscriptions (10 650 – 250 (1) – 400 (1)) 10 000 Competition – entrance fees 800 less cost of prizes 210 590 (2) 10 590 Expenditure General expenses 2 645} Travelling expenses 830}
(1)
Rent (2 600 – 50 (1) – 100 (1)) 2 450 Loss on sale of motor vehicle (2 000 – 1 750) 250 (1) Depreciation – motor vehicle (10 000 – 8 500) 1 500 (1) 7 675 Surplus for the year 2 915 (1) O/F
Horizontal presentation acceptable [10]
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(b) Safat Judo Club
Balance Sheet at 31 January 2006
$ $ Fixed Assets Motor vehicle at valuation 8 500 (1) Current Assets Rent prepaid 100 (1) Bank (3 150 + 13 200 - 16 285) 65 (2) 165 Current Liabilities Subscriptions prepaid 400 (1) (235) 8 265 Accumulated Fund Opening balance (3 150 + 2 000 + 250 – 50) 5 350 (2) Surplus for the year 2 915 (1) O/F 8 265
Horizontal presentation acceptable [8] (c) Reasons why bank balance does not equal surplus/deficit – R & P A/c shows total money paid and received I & E A/c adjusts figures for accruals and prepayments I & E A/c includes non-monetary items such as depreciation I & E A/c includes only revenue items Or other relevant points Any 2 acceptable points (1) each [2] [Total 20]
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IGCSE – May/June 2006 0452 03
© University of Cambridge International Examinations 2006
4 (a) John Chan
Sales Ledger
Wan Tan account
2006 $ 2006 $ April 1 Balance b/d 880 April 17 Bank 858 (1)
11 Sales 320 (1) Discount 22 (1) 30 Balance c/d 320 (1) 1 200 1 200
2006 May 1 Balance b/d 320 (1) O/F
Carol Lee account
2006 $ 2006 $ April 1 Balance b/d 270 April 21 Returns 72 (1)
6 Sales 168 (1) 28 Cash 300 (1) 29 Bad Debts 66 (1) 438 438
+ (1) for dates
[10] Alternative presentation
John Chan Sales Ledger
Wan Tan account
Debit Credit Balance
2006 $ $ $ April 1 Balance b/d 880 880 Dr
11 Sales 320 (1) 1 200 Dr 17 Bank 858 (1) 342 Dr
Discount 22 (1) 320 Dr (2) O/F
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© University of Cambridge International Examinations 2006
Carol Lee account
Debit Credit Balance
2006 $ $ $ April 1 Balance 270 270 Dr
6 Sales 168 (1) 438 Dr 21 Returns 72 (1) 366 Dr 28 Cash 300 (1) 66 Dr 29 Bad debts 66 (1) O/F 0
+ (1) for dates
[10] (b) (i) Matching OR Prudence [1] (ii) Matching To ensure that the amount of sales for the year which are unlikely to be paid are treated
as an expense of that particular year. OR Prudence To ensure that the profit is not overstated and that the asset of debtors in the Balance
Sheet shows a more realistic amount. [2] (c) (i) The $80 transferred to the Profit and Loss Account is the difference between the
provision for doubtful debts at the start of the year and the provision required to carry forward to next year. In this case it is the amount of surplus provision not required. (2)
(ii) This amount will be credited to the Profit and Loss Account. (1) [3] (d) Collection period for debtors – 7 190 x 365 (1) = 31.43 days = 32 days (1) 83 500 1 [2] (e) Ways of improving the collection period for debtors Offer cash discount for prompt payment Charge interest on overdue accounts Improve credit control Refuse further supplies on credit until any outstanding balance is paid Or other relevant points Any 3 acceptable points (1) each [3] [Total 21]
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IGCSE – May/June 2006 0452 03
© University of Cambridge International Examinations 2006
5 (a) David and Janet Szabo
Capital accounts
David Janet David Janet 2006 $ $ 2005 $ $ Jan 1 Current a/c (1) 3 000 Mar 1 Balance b/d (1) 19 000 14 000Feb 28 Balance c/d 16 000 16 000 2006 Feb 1 Cash (1) 2 000 19 000 16 000 19 000 16 000 2006 Mar 1 Balance b/d (1) 16 000 16 000
+ (1) for dates
Alternatively allow 2 separate “T” accounts [5] Alternative presentation
David Capital account
Debit Credit Balance 2005 $ $ $ Mar 1 Balance 19 000 19 000 Cr 2006 Jan 1 Current account 3 000 16 000 Cr
Janet Capital account
Debit Credit Balance
2005 $ $ $ Mar 1 Balance 14 000 14 000 Cr 2006 Feb 1 Cash 2 000 16 000 Cr
Opening balances (1) for both figures David current account transfer (1) Janet cash introduced (1) Closing balances (1) for both figures + (1) for dates [5]
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IGCSE – May/June 2006 0452 03
© University of Cambridge International Examinations 2006
(b) David and Janet Szabo
Departmental Trading and Profit and Loss Account for the year ended 28 February 2006
Men’s Clothing Department
Ladies’ Clothing Department
$ $ $ $ Sales 16 000 32 000 (2) Less Cost of sales Opening stock 1 000 2 200 (1) Purchases 12 000 26 700 (1) Carriage inwards 50 150 (1) 13 050 29 050 Less Closing stock 1 500 1 800 (1) 11 550 27 250 (1) Gross Profit 4 450 4 750 (1)O/F Less expenses 1 420 2 840 (2) Net Profit 3 030 1 910 (1)O/F
Horizontal format acceptable [11]
(c) A new partner joining an existing partnership will benefit from the Goodwill built up by the
existing partners, who must be compensated for this. [2] (d) (i) Explanation of – Will have a share in the profits Can take part in decision-making Prospects for the future Or other relevant points Any 2 points (1) each [2] (ii) Explanation of – Will be personally liable for the debts of the firm Will have greater responsibility Will probably have to invest capital Or other relevant points Any 2 points (1) each [2] [Total 22]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2007 question paper
0452 ACCOUNTING
0452/01 Paper 1 (Multiple Choice), maximum raw mark 40
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2007 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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IGCSE – May/June 2007 0452 01
© UCLES 2007
Question Number
Key Question Number
Key
1 B 21 B
2 D 22 B
3 B 23 D
4 B 24 C
5 A 25 D
6 B 26 A
7 C 27 B
8 C 28 D
9 A 29 C
10 A 30 C
11 D 31 A
12 C 32 C
13 A 33 D
14 C 34 D
15 B 35 A
16 B 36 D
17 C 37 A
18 D 38 B
19 B 39 B
20 B 40 B
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2007 question paper
0452 ACCOUNTING
0452/02 Paper 2, maximum raw mark 90
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began.
All Examiners are instructed that alternative correct answers and unexpected approaches in candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills demonstrated.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2007 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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© UCLES 2007
1 (a) Statement (of account) [1] (b) Rent, rates, water, insurance in advance (or similar) Utilities (e.g. gas, electricity, telephone) paid in advance Not prepayments [1] (c) Nominal or general (not personal or private) Not journal [1] (d) List of balances in the general (nominal) ledger at a given date [1] (e) Profit and loss appropriation account [1] (f) Outstanding lodgements, uncredited or unpresented cheques Items found in updating cash book, e.g. direct debits, bank interest, charges, dishonoured cheques, bank or cash book errors [2] (g) error of omission, commission, principle, compensating error, error of original entry, complete reversal (any one) [1] (h) Purchase of shop – capital [1] Broken glass – revenue [1] Cash register – capital [1] Advertisement – revenue [1] (i) Net profit percentage = (GP – expenses)/sales × 100% GP = 32 000 [1], Expenses = 20 000, NP = 12 000 [1]OF Sales = 80 000 [1] – must be shown in calculation Net profit percentage = 15.00% [1]OF (need not show % sign, but no other sign or description allowed) [4] [Total: 16]
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IGCSE – May/June 2007 0452 2
© UCLES 2007
2 (a) (i) 5000 [1] (ii) 1 April 2006 (must include year) [1] (iii) 80 000 [1] (iv) Inwards/(accept “in”) [1] (v) 37 000 [1] (vi) 5600 [1] (vii) Net profit (must show “net”) [1] (viii) 27 800 [1]OF only if wrong gross profit [8] (b) Rate of stock turnover = Cost of sales / average stock = 88 000 [1] / (42 000 + 36 000) [1] /2 [1] = 2.26 times [1]OF (accept 2.25 times) Alternative (reciprocal) calculation gives 161 or 162 days [4] (c) (i) Newsagent, petrol station, food store etc. hairdressing salon, clothing shop, but not bank [2] (ii) Furniture, carpets, cars, machines, etc. [2] [Total: 16]
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Page 4 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 2
© UCLES 2007
3 (a) Note: Date, narrative and amount required for each mark Complete reversal of account – no marks
Sales
30 April Trading Account 500 [1] 3 April Cash (sales) 500 [1]
(or Profit & Loss A/c) (not “Bank”)
Ahmed
1 April Balance b/d 2 850 [1] 12 April Bank 1 200 [1]
29 April Bank 650 [1]
30 April Balance c/d 1 000
2 850 2 850
1 May Balance b/d 1 000 [1]OF
Rent
1 April Bank 900 [1] 30 April Balance c/d 600
30 April Profit & Loss A/c 300 [1]
900 (not Trading A/c) 900
1 May Balance b/d 600 [1]OF only if Bank entry is correct
Electricity
6 April Bank 120 [1] 30 April Profit and Loss A/c 180 [1]OF
30 April Balance c/d 60 (not Trading A/c)
180 180
1 May Balance b/d 60 [1]
Wages
29 April Cash 700 [1] 30 April Profit and Loss A/c 700 [1]
Drawings
21 April Cash 800 [1] 30 April Capital 800 [1]
(or balance c/d)
[16] (b) Send statement of account Offer cash discount – not trade discount Refuse further business Refer to debt collectors Charge interest Offer future incentives Etc. Any two, 2 marks each [4] [Total: 20]
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Page 5 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 2
© UCLES 2007
4 (a) Note – Narrative and correct amount required for each mark Correct dates required for additional marks Complete reversal of account – no marks Account in note or memorandum form – no marks
Provision for depreciation – cooker
2006 31 March Balance c/d 180
2006 31 March Profit and Loss A/c 180 [1] (or Depreciation A/c)
1 April Balance b/d 180 [1]
2007 31 March Balance c/d 360
2007 31 March Profit & Loss A/c 180 [1]
360 360
1 April Balance b/d 360 [1]
+ [1] for dates
Provision for depreciation – motor van
2007 31 March Balance c/d 1 500
2007 31 March Profit & Loss A/c 1 500 [1] (or Depreciation A/c)
1 April Balance b/d 1 500 [1]
+ [1] for dates (b) Net book values: (i) the cooker: $ 840 [1]OF (ii) the motor van $ 4 500 [1]OF based on one year only [2] (c) Paula
Balance Sheet at 31 March 2007 (extract) Cost Provision for Net book depreciation value Fixed assets $ $ $ Machinery (cooker) 1200 [1] 360 [1]OF 840 [1]OF* Motor van 6000 [1] 1500 [1]OF 4500 [1]OF* Totals 7200 1860 5340 * OF marks based on answers in part (a) [6] [Total: 16]
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Page 6 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 2
© UCLES 2007
5 (a) To prepare final account To check arithmetical accuracy of books To check accounts balance To locate errors Other acceptable reason [1] (b) Ismail Khan
Trial balance at 30 April 2007 $ $ Sales 125 000 [1] Stock 14 500 [1] Purchases 76 000 [1] Bank (overdraft) 2 300 [1] Machinery 9 000 [1] Debtors 1 700 [1] Creditors 2 800 [1] Expenses 37 500 [1] Capital 15 500 [1] Drawings 8 000 [1] Suspense 1 100 [1]OF* 146 700 146 700 *OF mark awarded if account balances. May be shown
Separately but must be labelled “Suspense” [11] (c)
Dr Cr
Suspense 2 000 [1]
Sales 2 000 [1]
To correct cash sales omitted [1] (error of single entry)
Drawings 400 [1]
Suspense 400 [1]
To correct error in drawings account [1] (error of double entry)
Cash 500 [1]
Suspense 500 [1]
To include cash balance in trial balance [1] (error of single entry)
[9] (d) Nil [1]OF [1] [Total: 22]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2007 question paper
0452 ACCOUNTING
0452/03 Paper 3, maximum raw mark 100
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of
the examination. It shows the basis on which Examiners were instructed to award marks. It does not
indicate the details of the discussions that took place at an Examiners’ meeting before marking began.
All Examiners are instructed that alternative correct answers and unexpected approaches in
candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills
demonstrated.
Mark schemes must be read in conjunction with the question papers and the report on the
examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes.
CIE is publishing the mark schemes for the May/June 2007 question papers for most IGCSE, GCE
Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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Page 2 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 03
© UCLES 2007
1 (a) Work can be shared between several people
Easier for reference as same type of accounts are kept together
Easier to introduce checking procedures
Or other suitable point
Any 1 point [1] [1]
(b)
Purchases Ledger
Oman El Gamal account
2007
Mar 19 Bank
Discount recd
$
429
11
440
[1]
[1]
2007
Mar 8 Purchases
$
440
440
[1]
Mohammed El Wakil account
2007
Mar 24 Purchase returns
26 Cash
31 Balance c/d
$
128
110
66
304
[1]
[1]
[1]
2007
Mar 21 Purchases
2007
Apr 1 Balance b/d
$
304
304
66
[1]
[1]
O/F
+ [1] Dates
[9]
(b) Alternative presentation
Omar El Gamal account
2007
Mar 8 Purchases
19 Bank
Discount recd
Debit
$
429
11
[1]
[1]
Credit
$
440
[1]
Balance
$
440
11
0
Cr
Cr
Mohammed El Wakil account
2007
Mar 21 Purchases
24 Purchase returns
26 Cash
Debit
$
128
110
[1]
[1]
Credit
$
304
[1]
Balance
$
304
176
66
Cr
Cr
Cr
[2]C/F
[1]O/F
+ [1] Dates
[9]
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Page 3 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 03
© UCLES 2007
(c)
Nominal Ledger
Purchases account
2007
Mar 31 Total from
purchases journal
Cash
$
744
990
[1]
[1]
Purchases returns account
2007
Mar 31 Total from
returns journal
$
128
[1]
[3]
(c) Alternative presentation
Purchases account
2007
Mar 31 Total from
purchases journal
Cash
Debit
$
744
990
[1]
[1]
Credit
$
Balance
$
744
1 734
Dr
Dr
Purchases returns account
2007
Mar 31 Total from
returns journal
Debit
$
Credit
$
128
[1]
Balance
$
128
Cr
[3]
(d) Assist in the location of errors
Provide instant totals of debtors/creditors
Proves the arithmetical accuracy of sales/purchases ledgers
Enable the Balance Sheet to be prepared quickly
Provide a summary of the transactions relating to debtors/creditors
Provide an internal check on sales/purchases ledgers – may reduce fraud
Or other relevant points
Any 2 points [1] each [2]
(e)
Item Entry in sales ledger
control account
(ii) Cheques received from debtors credit [1]
(iii) Trade discount allowed to debtors no entry [1]
(iv) Contra item transferred to purchases ledger credit [1]
[3]
[Total: 18]
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Page 4 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 03
© UCLES 2007
2 (a) (i) So that the profits for the year are not over-stated [1]
(ii) So that the debtors in the Balance Sheet are shown at a realistic amount [1] [2]
(b) Matching principle [1]
(c) (i)
J.Ukata account
2006
Feb 4 Sales
Mar 1 Sales
$
900
80
980
[1]
2006
Mar 1 Bank
Discount
2007
Jan 31 Bad debts
$
873
27
80
980
[1]
[1]
[1]
(ii)
Bad debts account
2007
Jan 31 J.Ukata
$
80
80
[1]
2007
Jan 31 Profit & Loss
$
80
80
[1] O/F
(iii)
Bad debts recovered account
2007
Jan 31 Profit & Loss*
$
35
35
[1]
2006
Dec 31 Cash
$
35
35
[1]
(iv)
Provision for doubtful debts account
2007
Jan 31 Balance c/d
$
200
200
[1]
2006
Feb 1 Balance b/d
2007
Jan 31 Profit & Loss
2007
Feb 1 Balance b/d
$
150
50
200
200
[1]
[1]
[1]O/F
[12]
* Alternatively, transfer to bad debts account. The transfer from bad debts to profit & loss
would then be $45.
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Page 5 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 03
© UCLES 2007
(c) Alternative presentation
(i)
J.Ukata account
2006
Feb 4 Sales
Mar 1 Sales
Bank
Discount
2007
Jan 31 Bad debts
Debit
$
900
80
[1]
Credit
$
873
27
80
[1]
[1]
[1]
Balance
$
900
980
107
80
0
Dr
Dr
Dr
Dr
(ii)
Bad debts account
2007
Jan 31 J.Ukata
Profit & Loss
Debit
$
80
[1]
Credit
$
80
[1]O/F
Balance
$
80
0
Dr
(iii)
Bad debts recovered account
2006
Dec 31 Cash
2007
Jan 31 Profit & Loss*
Debit
$
35
[1]
Credit
$
35
[1]
Balance
$
35
0
Cr
(iv)
Provision for doubtful debts account
2006
Feb 1 Balance
2007
Jan 31 Profit & Loss
Debit
$
Credit
$
150
50
[1]
[1]
Balance
$
150
200
Cr
Cr [2]C/F
[1]O/F
[12]
* Alternatively, transfer to bad debts account. The transfer from bad debts to profit & loss
would then be $45.
(d)
Item Overstated Understated
(ii)
Net profit for the year ended 31
January 2007
$
50
[1]
$
No effect
[1]
(iii)
Total of current assets in Balance
Sheet at 31 January 2007
200 O/F [1]
No effect
[1]
[4]
[Total: 19]
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Page 6 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 03
© UCLES 2007
3 (a)
Jamil and Sara Suliman
Trading Account for the year ended 30 April 2007
Sales
Less cost of sales
Opening stock
Purchases
Less Closing stock – Stock remaining
Stock lost
Gross profit
$
4 500
2 500
[1]
[2]
[1]
C/F
O/F
$
5 000
26 000
31 000
7 000
[1]
[1]
$
30 000
24 000
6 000
[1]
(2)
Horizontal format acceptable [8]
(b) Calculation of net profit –
Gross profit
Less Expenses
Net profit
$
6000
4600
1400
[1]
O/F
O/F
[1]
(c) Calculation of partners’ share of the residual net profit/loss –
Net profit
Interest on capital – Jamil
Sara
Share of loss – Jamil
Sara
$
2000
1000
800
800
[1]
O/F
$
1400
3000
(1600)
(1600)
[1]
[1]
O/F
[3]
(d)
Current accounts
2006
May 1 Balance b/d
2007
Apr 30 Drawings
Share of Loss
2007
May 1 Balances b/d
Jamil
$
200
3100
800
4100
2100
Sara
$
2800
800
3600
2000
[1]
[1]
[1]
O/F
O/F
2006
May 1 Balance b/d
2007
Apr 30 Interest on capital
Balances c/d
Jamil
$
2000
2100
4100
Sara
$
600
1000
2000
3600
[1]
[1]
In all cases the marks are for suitable wording and two figures
Alternatively allow two separate “T” accounts [5]
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Page 7 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 03
© UCLES 2007
(d) Alternative presentation
Jamil Current account
2006
May 1 Balance
2007
Apr 30 Drawings
Share of loss
Interest on Capital
Debit
$
200
3100
800
Credit
$
2000
Balance
$
200
3300
4100
2100
Dr
Dr
Dr
Dr
Sara Current account
2006
May 1 Balance
2007
Apr 30 Drawings
Share of loss
Interest on Capital
Debit
$
2800
800
Credit
$
600
1 000
Balance
$
600
2200
3000
2000
Cr
Dr
Dr
Dr
Opening balances [1] for suitable wording and two figures
Drawings [1] for suitable wording and two figures
Share of loss [1] O/Fs for suitable wording and two figures
Interest on capital [1] for suitable wording and two figures
Closing balances [1] O/Fs for two figures
[5]
(e) (i) To enter goodwill on the books
account(s) to be
debited
$ account(s) to be
credited
$
Goodwill
20 000
[1]
Jamil Capital
Sara Capital
10 000
10 000
[1]
[1]
(ii) To write off the goodwill
account(s) to be
debited
$ account(s) to be
credited
$
Jamil Capital
Sara Capital
Fatima Capital
8000
8000
4000
[1]
[1]
[1]
Goodwill
20 000
[1]
[7]
[Total: 24]
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Page 8 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 03
© UCLES 2007
4 (a)
Peter Mpho
Balance Sheet at 31 January 2007
Fixed Assets
Premises at cost
Equipment at valuation
Current Assets
Stock
Debtors (19 200 + 150)
Petty cash
Current Liabilities
Creditors
Bank overdraft (300 – 1050)
Accrual
Working Capital
$
29 000
750
200
[1]
[1]
$
17 500
19 350
100
36 950
29 950
[1]
[1]O/F
[1]O/F
$
90 000
47 000
137 000
7 000
144 000
[1]
[1]O/F
Capital
Opening Balance
*Net Profit (13 500 – 200 + 600 – 3000 – 1050 + 150)
[1] [1] [1] [1] [1]
Drawings (10 400 + 600)
145 000
10 000
155 000
11 000
144 000
[1]O/F
[1]
Horizontal format acceptable [14]
*Calculation of net profit
Original figure
Add goods for own use
carriage outwards
Less wages owing
revaluation of equipment
bank charges
600
150
200
3000
1050
13 500
750
14 250
4 250
10 000
(b) (ii) Reliability [1]
(iii) Comparability [1]
(iv) Understandability [1]
[3]
(c) Financial information is only relevant if it can be used –
To confirm or correct prior expectations about past events
To assist in forming, revising or confirming expectations about the future
As the basis for financial decisions
Explanation of any 1 point [2] [2]
[Total: 19]
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Page 9 Mark Scheme Syllabus Paper
IGCSE – May/June 2007 0452 03
© UCLES 2007
5 (a) (i) Current ratio 70 000 : 40 000 = 1.75 : 1 [1]
(ii) Quick ratio (70 000 – 34 000) : 40 000 = 0.90 : 1 [1]
(iii) Collection period for debtors 1
365
000 275
000 29
× [1] = 39 days [1]
(iv) Payment period for creditors 1
365
000 465
000 40
× [1] = 32 days [1] [6]
(b) Does not include stock in the calculation [1]
Either
Stock is not regarded as a liquid asset – a buyer has to be found and then the money
collected. Some stock may prove to be unsaleable. [1]
Or
The quick ratio shows whether the business would have any surplus liquid funds if all the
current liabilities were paid immediately from the liquid assets. [1] [2]
(c) Satisfied if (a) (ii) is higher than the ratio for 2005
Not satisfied if (a) (ii) is lower than the ratio for 2005 [1]
(d) Increase in current liabilities greater than the increase in current assets
Increase in creditors and no significant change in current assets
Decrease in debtors and no significant change in current liabilities
Decrease in bank and no significant change in current liabilities
Decrease in stock and no significant change in current liabilities
Or suitable response based on own figure calculation in (a) (i)
Any 1 acceptable point [2] [2]
(e) (i) Not satisfied if (a) (iii) is more than the ratio for 2005
Satisfied if (a) (iii) is less than the ratio for 2005 [1]
(ii) Debtors are taking 9 days longer to pay than the previous year
Or suitable explanation based on O/F answer to (a) (iii) [2]
(f) Debtors are taking longer to pay so this may have a knock-on effect and
mean that the creditors may have to wait longer for their accounts to be paid.
Or suitable explanation based on O/F answer to (a) (iii) and (a) (iv) [2]
(g) Rate of stock turnover [1]
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IGCSE – May/June 2007 0452 03
© UCLES 2007
(h) The accounts may be for 1 year only and not show trends
The accounts may not be for a typical year
The financial year may end at a different point in the trading cycle
The businesses may operate different accounting policies e.g. depreciation
The accounts do not show non-monetary items but these are important in the success of a
business
It is not always possible to obtain all the information about a business in order to make a true
comparison
Or other suitable points
Any 3 correct points [1] each [3]
[Total: 20]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2008 question paper
0452 ACCOUNTING
0452/01 Paper 1 (Multiple Choice), maximum raw mark 40
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2008 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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Page 2 Mark Scheme Syllabus Paper
IGCSE – May/June 2008 0452 01
© UCLES 2008
Question Number
Key Question Number
Key
1 C 21 B
2 D 22 B
3 A 23 D
4 A 24 B
5 D 25 A
6 A 26 D
7 B 27 C
8 D 28 C
9 A 29 C
10 C 30 A
11 B 31 D
12 B 32 A
13 C 33 C
14 B 34 A*
15 D 35 C
16 A 36 B
17 D 37 C
18 C 38 B
19 B 39 D
20 C 40 B
* Question cancelled – refer to Examiner Report for details.
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2008 question paper
0452 ACCOUNTING
0452/02 Paper 2, maximum raw mark 90
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began.
All Examiners are instructed that alternative correct answers and unexpected approaches in candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills demonstrated.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2008 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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Page 2 Mark Scheme Syllabus Paper
IGCSE – May/June 2008 0452 02
© UCLES 2008
Marking Guidelines • Where a candidate makes an arithmetical error or selects the wrong figure in an account or a
calculation so that totals or the results of the calculation are wrong but are correct on his own figures, he will lose the mark for selecting the original figure but may earn an own figure mark for the result, total or calculation.
• Where particular wording is shown on the mark scheme accept any reasonable spelling and abbreviation as long as the meaning is clear.
• For example, for ‘Balance brought down’ accept Balance b/down, Balance b/d, Balance, Bal b/down, Bal b/d, Bal, Brought down, b/down, b/d, B/b/d, B/f, but not Bbd, bd, or any variation of ‘Balance carried down’.
• Where a ledger account is to be prepared, each mark is usually for the date, narrative and amount together but if the candidate has correctly prepared the account but not shown some or all of the dates he may earn some marks according to the mark scheme.
• If a ledger account is completely reversed no marks will be awarded for individual entries but there may be marks available for own figure balances carried and brought down.
• Where an answer is to be shown as a ratio, it should be shown as xx:1 and not as 1:xx. An answer of just the correct figure xx may be accepted but not if any other description such as %, times, days etc. is shown and not if shown as negative when it should be positive.
• Where a calculation is to be shown to two decimal places, an answer rounded up or down may be accepted (e.g. 2.85 or 2.86 if the true answer is 2.853) but not an answer shown to only the nearest whole number or one decimal place (e.g. 2.8 or 3).
• Where dollars and cents are shown in a question and exact cents are required in a calculated answer (e.g. $35.60) many candidates will show $35.6 as their calculators will suppress the final 0. Although wrong this may be accepted.
• Ledger accounts may be accepted in either two sided or the running balance format and the mark scheme will show how marks should be allocated.
• Where a final account is requested, a list of items will not normally earn any marks.
• If candidates are required to prepare a Balance Sheet, either a two sided or a vertical presentation will be accepted and the mark scheme will show how marks are to be awarded.
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Page 3 Mark Scheme Syllabus Paper
IGCSE – May/June 2008 0452 02
© UCLES 2008
1 (a) (i) and (ii) to calculate profit or loss, to know what assets and liabilities the business has, to compare with previous years, to compare with other businesses, to calculate accounting ratios, for use by other parties e.g. bank other acceptable but specific answers (1) mark each [2]
(b) (i) stock, debtors, prepayments, cash, bank, etc. – any one [1] (ii) creditors, accrued expenses, bank overdraft, etc. – any one [1] (loan but only if stated repayable within one year) (c) Matching, prudence not consistency [1] (d) Suspense account [1] (e) Current liabilities [1] (f) An amount owed (by a debtor) (1) which he is unable or unwilling to pay (1). [2] Accept words making these points. (g) (i) $100 (must be amount not description of imprest) [1] (ii) $70 [1] (h) (i) Current assets (accept CA) (1) less (accept – or :) current liabilities (accept CL) (1) [2] (ii) A business needs sufficient working capital for
• the day-to-day running of the business • to pay expenses, liabilities, etc. as they fall due (2 marks for either or similar comment – if given as answer to (i) may award 2 marks but only once) [2]
[Total: 15]
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Page 4 Mark Scheme Syllabus Paper
IGCSE – May/June 2008 0452 02
© UCLES 2008
2 (a) Emilie
Cash Book, March 2008
Date Details Discount Cash Bank Date Details Discount Cash Bank $ $ $ $ $ $
1 Balance b/down 1700 3000 3 Jules (1) 6 (1) 194 (1) 5 Andre (1) 1200 (1) 6 Michel (1) 85 (1) 7 Wages (1) 330 (1) 7 Sales (1) 1850 (1) (Note: date and correct narrative required for mark, discount, cash and bank marks
may be awarded if either date or narrative (but not both) is missing, no marks for balances brought down, no requirement to balance the account, no totals required.) [11]
(b) Cash sales 1850 (1) Credit sales 200 (1) Total sales 2050 (1)OF [3] Correct figures only, do not accept $194 or $188 for credit sales. Do not award total
mark if any aliens shown. (c)
Emilie Trading Account for the week ended 7 March 2008
$ $ Sales (accept total from (b)) 2050 (1)OF Stock at 1 March 1700 (1) Purchases (correct figure only) 1200 (1) 2900 Stock at 7 March 1650 (1) Cost of goods sold 1250 (1)OF Gross profit 800 (1)OF
[6] [Total: 20]
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IGCSE – May/June 2008 0452 02
© UCLES 2008
3 (a) 200 units (1) @ $3.20 (1) = $ 640 (1)OF [3] Accept if just shown as figures, 3 marks for just the correct answer. (b) 100 units @ $3.20 = $ 320 (1) 150 units @ $3.00 = $ 450 (1) 100 units @ £3.00 = $ 300 (1) Total $1 070 (1)OF [4] Do not award total mark if any aliens (c) 300 units (1) @ $3.00 (1) = $ 900 (1)OF [3] Accept if just shown as figures, 3 marks for just the correct answer. (d) Opening stock (units) 200 (1) Purchases (units) 350 (1) 550 Closing stock (units) 300 (1) Sold (units) 250 (1)OF [4] If closing stock is added, award final mark but not stock mark. (e) $ Opening stock (value) 640 (1)OF Purchases (value) 1070 (1)OF 1710 Closing stock (value) 900 (1)OF Cost of goods sold 810 (1)OF [4] Award these marks if correct or if correctly calculated on own figures from (a), (b) and
(c). [Total: 18]
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IGCSE – May/June 2008 0452 02
© UCLES 2008
4 (a) Solomon
Trading and Profit and Loss Account Year ended 31 March 2008
$ $ Sales 47 500 (1) Opening stock 1 500 (1) Purchases 28 800 (1) 30 300 Closing stock 1 800 (1) Cost of sales (goods sold) 28 500 (1)OF (words must appear somewhere)(do not award if any aliens) Gross profit (do not award if any other aliens) 19 000 (1)OF Expenses Carriage outwards 720 (1) Electricity 1 800 (1) Motor expenses 1 380 (1) Depreciation 2 400 (1) Rent (6 000 (1) – 1 200*(1)) 4 800 (2) Wages (8 600 (1) + 400*(1)) 9 000 (2) (*if wrongly added or subtracted, no mark, accept if shown as separate items with no total) Total 20 100 Net loss 1 100 (1)OF (accept Net profit if figure shown as negative (–) or in brackets, or is a profit on own figures; do not award if any aliens) [15]
(b)
Solomon Capital account, year ended 31 March 2008
2008 $ 2007 $ 31 March Net loss 1 100 (1)OF 1 April Balance b/d 36 000 (1) 31 March Drawings 24 000 (1) (not Capital) 31 March Balance c/d 10 900 (1)OF _____ 36 000 36 000 2008 1 April Balance b/d 10 900
Narrative and amount (but not date) required for mark. Must be an account, not a list or a sum. [4] (c) [Increase sales, buy more cheaply, increase prices] = increase gross profit, reduce [any
named] expenses = increase net profit (any two, one mark each) [2] (d) Introduce more capital into the business, reduce drawings, [reduce net loss, make or
increase income or net profit] (any two, one mark each) accept ‘take in a partner with capital’ [2]
[Total: 23]
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IGCSE – May/June 2008 0452 02
© UCLES 2008
5 (a)
Capital expenditure Revenue expenditure
Purchase of taxi � (1)
Installing meter � (1)
Taxi licence � (1)
Taxi insurance � (1)
Filling taxi with fuel � (1)
Servicing engine � (1)
[6] (b) (i) 18 000 (1) × 30% (1) = 5 400 (1)OF [3] If no calculation shown but correct figure award 3 marks; If e.g. used wrong % but calculation correct award 2 marks. (ii) 12 600 (1)OF × 30% (1) = 3 780 (1)OF [3] If no calculation shown but correct figure award 3 marks; If calculations for more than one year then do not award result mark but may award
starting mark and rate mark; If e.g. used wrong basis or % but calculation correct award up to 2 marks. (c) (12 600 OF – 3 780 OF) (1) = 8 820 OF (1) [2] or (18 000 – 9 180 OF) (1) If no calculation but correct figure then award 2 marks. [Total: 14]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2008 question paper
0452 ACCOUNTING
0452/03 Paper 3, maximum raw mark 100
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began.
All Examiners are instructed that alternative correct answers and unexpected approaches in candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills demonstrated.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2008 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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1 (a) Ascertain the true bank balance at a certain date Assist in detecting fraud and embezzlement Identify any “stale” cheques Demonstrate that any differences between the cash book balance and that on the statement
are due to genuine reasons Or other suitable reason Any two reasons (1) each [2] (b) Cash Book (bank columns only)
2008 $ 2008 $ May 1 Balance b/d 2073 (1) May 1 Insurance 360 (1) Lobatse Traders (dishon. chq.) 314 (1) Bank charges 11 (1) Correction of error 90 (1) ____ Balance c/d 1298 2073 2073 May 1 Balance b/d 1298 (1)O/F
[6] (c) Bank Reconciliation Statement at 30 April 2008
$ $ Balance shown on bank statement 1250 (1) Add amounts not yet credited – Cash 500 (1) 1750 Less cheques not yet presented – Ghanzi & Co 390 (1) bank error 62 (2) 452 Balance shown in cash book 1298 (1)O/F
[6] Alternative presentation Bank Reconciliation Statement at 30 April 2008
$ $ Balance shown in cash book 1298 (1)O/F Add cheques not yet presented – Ghanzi & Co 390 (1) bank error 62 (2) 452 1750 Less amounts not yet credited – Cash 500 (1) Balance shown on bank statement 1250 (1)
[6] (d) $1298 (1)O/F Asset (1) [2]
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(e) Current ratio (6322 + 5670 + 100 + 1298 O/F) : 7250 (1)O/F = 13390 O/F : 7250 = 1.85 : 1 (1)O/F [2] (f) Does not include stock in the calculation (1) Either Stock is not regarded as a liquid asset – a buyer has to be found and then the money
collected. Some stock may prove to be unsaleable. (1) Or The quick ratio shows whether the business would have any surplus liquid funds if all the
current liabilities were paid immediately from the liquid assets. (1) [2] [Total: 20] 2 (a) Ensures that profits are not overstated (prudence) Ensures that debtors are shown in balance sheet at more realistic amount (prudence) Application of matching principle as the amount of sales unlikely to be paid for are treated as
an expense of that particular year Or other suitable reason Any one reason (1) [1] (b) 2007 February 1 Balance The provision for doubtful debts in existence at that date brought down from the previous
financial year. (2) 2008 January 31 Profit and loss The amount transferred to the profit and loss account representing the surplus provision no
longer required. (2) $600 shown at the end of the account The new provision for doubtful debts carried forward to the next financial year. (2) [6] (c) If debtors delay payment the business may be forced to delay paying its creditors unless
liquid funds are available. If debtors pay within the set time the business may be able to pay its creditors within the set
time without any significant impact on the bank balance. Or other suitable comment Any one reason (2) [2]
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(d) Collection period for debtors
1
365
500268
00030×
(1) = 40.78 days = 41 days (1) [2]
(e) Payment period for creditors
1
365
500242
20020×
(1) = 30.40 days = 31 days (1) [2]
(f) May be able to take advantage of cash discounts Improve the relationship with suppliers Or other suitable comment Any two points (1) each [2] (g) Subscriptions account
2007 $ 2008 $ Apl 1 Balance b/d 320 (1) Mar 31 Cash 8720 (1) 2008 Mar 31 Balance c/d 400 (1) Income & Expenditure(1) 8000 (1)O/F ____ 8720 8720 2008 Apl 1 Balance b/d 400 (1)
+ (1) dates [7] Alternative presentation Subscriptions account
Debit Credit Balance 2007 $ $ $ Apl 1 Balance 320 (1) 320 Dr 2008 Mar 31 Cash 8720 (1) 8400 Cr Income & Expenditure (1) 8000 (1)O/F 400 Cr (2)
+ (1) dates [7] [Total: 22]
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IGCSE – May/June 2008 0452 03
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3 (a) Journal Debit Credit $ $ 1 Stationery 20 (1) Abdul Current 20 (1) 2 Suspense 300 (1) Purchases 300 (1) 3 Suspense 100 (1) Bad Debts 50 (1) Bad Debts Recovered 50 (1) 4 Amina Capital 2200 (1) Amina Current 2200 (1)
[9] (b) Suspense account
2008 $ 2008 $ Apl 30 Purchases 300 (1) Apl 30 Difference on trial Bad debts 50 (1) balance 400 (1) Bad debts recovered 50 (1) ___ 400 400
[4] Alternative presentation Suspense account
Debit Credit Balance $ $ $ 2008 Apl 30 Difference on trial balance 400 (1) 400 Cr Purchases 300 (1) 100 Cr Bad debts 50 (1) 50 Cr Bad debts recovered 50 (1) 0
[4]
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(c) Abdul and Amina Mahmoud Statement of corrected net profit for the year ended 30 April 2008
$ Net profit before corrections 12 900 Effect on net profit Increase Decrease $ $ Error 1 20 2 300 (1) 3 100 (1) 4 No effect (1) ___ __ 400 20 380 Corrected net profit 13 280 (1)O/F
[4] (d) Increase gross profit e.g. increase profit margin, increase selling prices etc. Reduce expenses e.g. reduce staffing levels, reduce advertising etc. Increase other income e.g. rent out part of premises, earn more discount Or other acceptable point Any two points (1) each [2] [Total: 19]
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IGCSE – May/June 2008 0452 03
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4 (a) (i) Stocks are valued at the lower of cost and net realisable value. [1] (ii) Prudence [1] (b) Gideon Yeboah Manufacturing Account for the year ended 31 March 2008
$ $ Cost of raw materials Opening stock of raw materials 21 230 (1) Purchases 255 620 (1) 276 850 Less Closing stock of raw materials 19 410 (1) 257 440 Direct factory wages (194 060 + 4800) (1) 198 860 Prime cost 456 300 (1) Factory general expenses (133 910 – 210) 133 700 (1) Depreciation factory machinery (103 000 + 21 000 – 92 000) 32 000 (1) 165 700 622 000 (1)O/F Add opening work in progress 11 680 (1) 633 680 Less closing work in progress 12 130 (1) Cost of production 621 550 (1)O/F
Horizontal format acceptable [11] (c) Gideon Yeboah Trading Account for the year ended 31 March 2008
$ $ Sales 825 000 (1) Less Cost of sales Opening stock of finished goods 46 900 (1) Cost of production 621 550 (1)O/F Purchases of finished goods 13 200 (1) 681 650 Less Closing stock of finished goods 53 170 (1) 628 480 Gross profit 196 520 (1)O/F
Horizontal format acceptable [6] [Total: 19]
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Page 8 Mark Scheme Syllabus Paper
IGCSE – May/June 2008 0452 03
© UCLES 2008
5 (a) Ensures that the loss in value of motor vehicles is spread over the period in which they are earning revenue. [2]
(b) (i) Motor vehicles account
2006 $ 2006 $ Jan 1 Ansari Road Dec 31 Balance c/d 60 000 Motors 60 000 (1) _____ 60 000 60 000 2007 2007 Jan 1 Balance b/d 60 000 Jun 30 Disposals 20 000 (1) _____ Dec 31 Balance c/d 40 000 (1)O/F 60 000 60 000 2008 Jan 1 Balance b/d 40 000 (1)O/F
(ii) Provision for depreciation of motor vehicles account
2006 $ 2006 $ Dec 31 Balance c/d 12 000 Dec 31 Profit & loss 12 000 (1) 12 000 12 000 2007 2007 Jun 30 Disposals 4 000 (2) Jan 1 Balance b/d 12 000 (1)O/F Dec 31 Balance c/d 14 400 (1)O/F Dec 31 Profit & loss 6 400 (2)O/F 18 400 18 400 2008 Jan 1 Balance b/d 14 400 (1)O/F
(iii) Disposal of motor vehicle account
2007 $ 2007 $ Jun 30 Motor vehicles 20 000 (1)O/F Jun 30 Prov. for Dep. 4 000 (1)O/F Dec 31 Profit & loss (1) 1 000 (1)O/F Apollo Traders 17 000 (1) 21 000 21 000
+ (1) dates [18]
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IGCSE – May/June 2008 0452 03
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Alternative presentation (b) (i) Motor vehicles account
Debit Credit Balance 2006 $ $ $ Jan 1 Ansari Road Motors 60 000 (1) 60 000 Dr 2007 Jun 30 Disposals 20 000 (1) 40 000 Dr(2)O/F
(ii) Provision for depreciation of motor vehicles account
Debit Credit Balance 2006 $ $ $ Dec 31 Profit & loss 12 000 (1) 12 000 Cr(1)O/F 2007 Jun 30 Disposals 4 000 (2) 8 000 Cr Dec 31 Profit & loss 6 400 (2)O/F 14 400 Cr(2)O/F
(iii) Disposal of motor vehicle account
Debit Credit Balance 2007 $ $ $ Jun 30 Motor vehicles 20 000 (1)O/F 20 000 Dr Prov. for Dep. 4 000 (1)O/F 16 000 Dr Apollo Traders 17 000 (1) 1 000 Cr Dec 31 Profit & loss (1) 1 000 (1)O/F 0
+ (1) dates [18] [Total: 20]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2009 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/01 Paper 1 (Multiple Choice), maximum raw mark 40
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2009 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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Page 2 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2009 0452 01
© UCLES 2009
Question Number
Key Question Number
Key
1 B 21 D
2 A 22 D
3 A 23 B
4 C 24 D
5 A 25 D
6 B 26 B
7 C 27 C
8 C 28 A
9 C 29 D
10 B 30 D
11 A 31 A
12 C 32 A
13 D 33 A
14 A 34 B
15 D 35 D
16 C 36 B
17 C 37 C
18 B 38 C
19 D 39 C
20 B 40 D
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2009 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/02 Paper 2, maximum raw mark 90
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2009 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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IGCSE – May/June 2009 0452 02
© UCLES 2009
1 (a) Realisation [1] (not accruals or matching) (b)
Asset Liability
(i) Prepayment √ (1)
(ii) Bank overdraft √ (1)
(iii) Provision for depreciation √ (1)
[3] (c) A cheque issued and entered in the cash book (1) but not yet shown on the bank statement
as paid by the bank (1) [2] (accept “cheques not presented to the bank” for 1 mark) (d) “Net realisable value” (accept NRV) [1] (e) Trading (and Profit and Loss) account [1] (accept Profit & Loss account or Income statement) (f) Current assets (1) less current liabilities (1) not “CA less CL” [2] (g) (i) Land, buildings, plant, equipment, fixtures, motor vehicles (other acceptable fixed asset) [1] (ii) Any suitable revenue expense [1] (h) Gross profit percentage = gross profit/sales × 100% = 22 500 (1) / 75 000 (1) × 100% = 30% (1)OF [3] (need not show % sign but must not have any other term e.g. “times”)
[Total: 15]
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2 (a) $ 200.00 – $ 129.00 = $ 71.00 (1) [1] (accept $71 without .00) (b) $ 20.00 + 17.00 + 21.00 +14.50 = $ 72.50 (1) [1] (accept $72.5 without final 0 and throughout) (c) $ 200.00 (1) – $ 72.50 (1)(OF from (b)) = $127.50 [2] (award (2) for $127.50 but must show workings for OF mark) (d) (i) Missing voucher, error or fraud (1) (ii) Missing or stolen cash (1) [2] (e) Always complete (get) a petty cash voucher (1) with an invoice or receipt for expenditure (1) Record all petty cash transactions (1) [2] (do not accept general comments about business records – must relate to petty cash) (f) See next page
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Page 4 Mark Scheme: Teachers’ version Syllabus Paper IGCSE – May/June 2009 0452 02
© UCLES 2009
Date
April
Details Total
$
Date
April
Details Total
$
Postage/ stationery
$
Refrshmnts
$
Flowers
$
Cleaning
$
Other/Loan
$
1 Balance b/d (not “bank” but accept “imprest” or “float”)
129.00(1) or 200.00(1)
(if no bank entry)
5 Postage 20.00 20.00 (1)
1 Bank (not “cash”)
71.00(1) 10 Refreshments 17.00 17.00 (1)
29 Menon/loan (not “cash”)
100.00(1) 13 Menon/loan 100.00 100.00 (1)
17 Flowers 21.00 21.00 (1)
24 Stationery 14.50 14.50 (1)
28 Cleaning 10.00 10.00 (1)
_________ 30 Balance c/d 117.50 _______ _______ _______ _______ _______
300.00 __300.00 34.50 17.00 21.00 10.00 100.00
May 1 Balance b/d
(accept “imprest”)
117.50(1) (OF) to
agree with bal c/d
+ (1) for all dates (Dr and Cr)
1 Bank (not “cash”)
82.50(1) (OF) to
total $200
(for both debits and credits, mark is for narrative detail, correct total and correct extension) [12]
[Total: 20]
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IGCSE – May/June 2009 0452 02
© UCLES 2009
3 (a) Purchases journal (day book) (1) (accept “purchases”, “purchases book”, not “account” or “ledger”) (b)
OFFICE SUPPLY COMPANY INVOICE
Tom Charter
3 Mountain Close
Tobermore
15 April 2009
Item Quantity Price per unit Total
$ $
Boxes of staples 20 7.50 (i)
Packets of
envelopes
(ii) 14.00 350.00
500.00
Less (iii) discount @ 3 % (iv)
Net amount (v)
______
Terms: 2 ½ % (vi) discount for settlement within 14 days
[6]
25 (1)
150.00 (1)
15.00 (1) Trade (1)
Cash (1)
485.00 (1)
(correct figures only)
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(c) Opening stock 7 600 (1) Purchases 92 100 (1) Less purchases returns (2 300) (1) 97 400 Less closing stock 9 200 (1) Cost of goods sold 88 200 [4] (narrative not required, award if correct numbers are shown) (d) Rate of stock turnover = cost of goods sold / average stock = (88 200 (1)(OF) / (7 600 + 9 200)(1) / 2(1)) times (award 2 marks for 8 400) = 10.5 times (1)(OF) (must be 10.5 – do not award for “10” or “11”) (award 4 marks if 10.5 shown without workings, otherwise only award marks in accordance
with workings shown) (accept 10.5 without “times”, but do not accept with %, ratio or other description. Accept 34,
34.76 or 35 days if reciprocal formula is used) [4] (e) (i) Food, drinks, petrol, etc. (2) (ii) Jewellery, household appliances, cars, furniture etc. (2) [4]
[Total: 19]
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Page 7 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2009 0452 02
© UCLES 2009
4 (a) Rupa Motor expenses account March March 6 Bank (not cash) 120.00 (1) 1 Balance b/d 120.00 (1) (not repairs) (accept accrued/owing/outstanding) 12 Bank (not tyres) 150.00 (1) 31 Balance c/d 80.00 (1) 31 Profit & Loss (not Trading) (accept accrued/owing) Account* 230.00 (1)OF 350.00 350.00 April 1 Balance b/d 80.00 (1) (correct figure only) (+ (1) for all correct dates) [7] (*award OF mark if Cr or Dr and amount closes account) (b) Mopsa Rent account April April 27 Bank (not cash, 500.00 (1) 1 Balance b/d 150.00 (1) not rent, landlord etc) (accept accrued/owing/outstanding) 30 Balance c/d 100.00 (2) 30 Profit & Loss (accept accrued/owing) Account* 450.00 (1)OF 600.00 600.00 May 1 Balance b/d 100.00 (1) (correct figure only) (+ (1) for all correct dates) [7] (*award OF mark if Cr or Dr and amount closes account) (c)
understated √ (2)
overstated
[2]
[Total: 16]
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Page 8 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2009 0452 02
© UCLES 2009
5 (a) Gordon Capital account 2008 1 April Balance b/d 6 400 (1) (accept capital) 2009 2009 31 March Drawings 12 000 (1) 31 March Net profit 12 900 (1) 31 March Balance c/d 7 300 (1)(OF)* 19 300 19 300 1 April Balance b/d 7 300 (*award OF mark if Dr or Cr balance, and no alien figures) (dates not required, narrative and figures only) [4]
(b) Gordon – Balance sheet at 31 March 2009 Cost Provision for Net book depreciation value Fixed assets $ $ $ Plant and equipment 8 000 1 600 6 400 (1) Motor vehicles 4 000 1 000 3 000 (1) (correct narratives) 12 000 2 600 9 400 Current assets Stock 1 900 Debtors 3 400 Bank 700 6 000 (1) (must show narrative and figures) Current liabilities Creditors 2 100 (1) Net current assets (working capital) 3 900 (1) (award 1 mark if horizontal balance sheet and CA and CL are correct) 13 300 Less long term liability Bank loan repayable 2011 6 000 (1) (may be shown under “Financed by”) 7 300 (1)OF (total to agree with total below, must be arithmetically correct) Financed by: Capital 7 300 (1) (or balance from part (a) only) [8]
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IGCSE – May/June 2009 0452 02
© UCLES 2009
5 (c) (i) Current assets / Current liabilities 6 000 (1)OF / 2 100 (1)OF = 2.86:1 (1)OF (accept 2.85 but not 2.8, 2.9 or 3, other correct OF calculations on same basis) (ii) Current assets – stock / Current liabilities (6 000 – 1 900) = 4 100 (1)OF / 2 100 (1)OF = 1.95:1 (1)OF (or debtors 3 400 + bank 700 = 4 100 (1)) (do not accept 1.9 or 2, accept other correct OF calculations on same basis) [6] (d)
current ratio
quick ratio √ (2)
[2]
[Total: 20]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2009 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/03 Paper 3, maximum raw mark 100
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2009 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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IGCSE – May/June 2009 0452 03
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1 (a) (i) Tony and Alice Mundondo Motor vehicles account
2007 $ 2008 $ Mar 1 Valley Motors 9 500 (1) Feb 29 Balance c/d 9 500 9 500 9 500 2008 2009 Mar 1 Balance b/d 9 500 Feb 28 Balance c/d 20 300 2008 Jul 1 Bank 10 800 (1) _____ 20 300 20 300 2009 Mar 1 Balance b/d 20 300 (1)
(ii) Provision for depreciation of motor vehicles account
2008 $ 2008 $ Feb 28 Balance c/d 1 900 Feb 29 Profit & loss 1 900 (1) 1 900 1 900 2009 2008 Feb 28 Balance c/d 5 240 Mar 1 Balance b/d 1 900 (1)O/F 2009 Feb 28 Profit & loss 1 900 (1) ____ 1 440 (1) 3 340 5 240 5 240 2009 Mar 1 Balance b/d 5 240 (1)O/F
+ (1) dates [9] (a) Alternative presentation (i) Tony and Alice Mundondo Motor vehicles account
Debit Credit Balance 2007 $ $ $ Mar 1 Valley Motors 9 500 (1) 9 500 Dr 2008 July 1 Bank 10 800 (1) 20 300 Dr (1)
(ii) Provision for depreciation of motor vehicles account
Debit Credit Balance 2008 $ $ $ Feb 29 Profit & loss 1 900 (1) 1 900 Cr (1)O/F 2009 Feb 28 Profit & loss 1 900 (1) 1 440 (1) 3 340 5 240 Cr (1)O/F
+ (1) dates [9]
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(b) Tony and Alice Mundondo Extract from Balance Sheet at 28 February 2009
Fixed assets Cost Depreciation to date
Net book value
$ $ $ Motor vehicles 20 300 5 240 15 060 (1)O/F (1)O/F (1)O/F
[3]
(c) transaction account to be debited
account to be credited
(i)
(ii)
(iii)
eliminating original cost of motor vehicle from ledger eliminating accumulated depreciation from ledger recording part exchange allowance made by Valley Motors
disposal of motor vehicle (1) provision for deprecation (1) Valley Motors (1)
motor vehicles (1) disposal of motor vehicle (1) disposal of motor vehicle (1)
[6] (d) (i) Fixed assets are valued at the end of each financial year. (1) This value is compared with the previous valuation (or the cost if it is the first year
of ownership) and the amount by which the asset has fallen in value is the depreciation for the year. (1) [2]
(ii) Hand tools Packing cases Or other suitable example Any 1 example (1) mark [1] [Total: 21]
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2 (a) Morag MacDonald Profit and Loss Account for the year ended 31 December 2008
$ $ Fees from clients (75 050 + 9 000) 84 050 (1) Rent received (2 750 – 150) 2 600 (1) Reduction in provision for doubtful debts (250 – 225)
___25
(1)
86 675 Less Property tax 1 800 Repairs and maintenance 2 930
(1)
Wages (45 000 + 2 000) 47 000 (1) Stationery and office supplies (1 790 – 35)
1 755
(1)
Insurance (1 680 – 240) 1 440 (1) Depreciation – Office equipment (50% × (10 800 – 8 100))
1 350
(1)
56 275
Net profit 30 400 (1)O/F Horizontal format acceptable [9] (b) To be able to meet debts when they fall due To be able to take advantage of cash discounts To be able to take advantage of business opportunities as they arise To ensure that there is no difficulty in obtaining further supplies Or other suitable explanation Any 1 point (2) marks [2] (c) Introduce further capital Reduce drawings Sell surplus fixed assets Obtain long term loans Any two points (1) each [2] (d) (ii) Effect Working capital decreases by $40 (1) Explanation Current assets decrease by $50 as net debtors decreases. There is no change in the current liabilities. (1) (iii) Effect Working capital does not change (1) Explanation The current assets do not change as the cash increases and the
debtors decrease by $200. There is no change in the current liabilities. (1)
(iv) Effect Working capital increases by $4 (1) Explanation Current assets decrease by $96 and the current liabilities
decrease by $100. (1) [6] [Total: 19]
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3 (a) Mohammed Hanif Sales ledger control account
2009 $ 2009 $ Apl 1 Balance b/d 4100 (1) Apl 1 Balance b/d 72 (1) 30 Sales returns 320 (1) 30 Sales 5300 (1) Bank 3850 (1) Bank (dis.chq.) 65 (1) Discount allowed 150 (1) Inter-ledger
transfer
240 (1)
____ Balance c/d 4833 9465 9465 2009 May 1 Balance b/d 4833 (1)O/F
+ (1) Dates
Alternative presentation Mohammed Hanif Sales ledger control account
Debit Credit Balance 2009 $ $ $ Apl 1 Balances 4100 (1) 72 (1) 4028 Dr 30 Sales 5300 (1) 9328 Dr Bank (dis.chq) 65 (1) 9393 Dr Sales returns 320 (1) 9073 Dr Bank 3850 (1) 5223 Dr Discount allowed 150 (1) 5073 Dr Inter-ledger transfer 240 (1) 4833 Dr (1)O/F
+ (1) Dates [10] (b) Overpayment of amount due by debtor Cash discount not deducted by debtor before payment made Goods returned by debtor after payment of amount due Payment made in advance by debtor Or other suitable point Any 1 reason (1) mark [1]
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(c) Item Entry in purchases ledger
control account
(ii)
(iii)
(iv)
Cash purchases Discount received Interest charged by supplier on overdue account
No entry (1) Debit (1) Credit (1)
[3] (d) Financial information is only relevant if it can be used – To correct or confirm prior expectations about past events To assist in forming, revising or confirming expectations about the future As a basis for financial decisions In time to be able to influence decisions Explanation of any 1 point (2) [2] (e) (ii) Money measurement Accounts only record information which can be expressed in monetary terms. (1) This means that many factors which affect the performance of a business will not
appear in the accounting records. (1) [2] (iii) Time factor Accounting statements are a record of what has happened in the past. (1) Either They are not necessarily a guide to future performance (1) Or Significant events can occur between the end of the financial period and the
time when the accounting statements are available. (1) [2] [Total: 20]
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4 (a) Lobatse Rugby Club Subscriptions account
2008 $ 2008 $ Apl 1 Balance b/d 50 (1) Apl 1 Balance b/d 100 (1) 2009 2009 Mar 31 Income & Mar 31 Bank 2250 (1) expenditure (1) 2500 (1) Balance c/d _200 2550 2550 2009 Apl 1 Balance b/d 200 (1)
+ (1) Dates
Alternative presentation Lobatse Rugby Club Subscriptions account
Debit Credit Balance 2008 $ $ $ Ap 1 Balances 50 (1) 100 (1) 50 Cr 2009 Mar 31 Bank 2250 (1) 2300 Cr Income & expenditure (1) 2500 (1) 200 Dr (1)
+ (1) Dates [7] (b) Lobatse Rugby Club Income and Expenditure Account for the year ended 31 March 2009
$ $ Income Subscriptions 2500 (1)O/F Sports day – entrance fees 520 less expenses 370 150 (2) Interest received 100 (1) 2750 Expenditure Secretarial expenses 210 Advertising 40
(1)
General expenses (490 – 20) 470 (1) Rent (1530 + 30) 1560 (1) Depreciation – equipment (4400 + 1800) × 10% 620 (1) 2900 Deficit for the year (1) 150 (1)O/F
Horizontal format acceptable [10]
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(c) (i) Either Opening balance or closing balance (1) Opening/closing bank balance is neither income nor expenditure for the year as it
represents the amount of money in the bank on that particular date. (1) Or Transfer to bank deposit account (1) Transferring money from one bank account to another is neither income nor
expenditure. (1) Or Purchase of equipment (1) This is not regarded as revenue expenditure as it is the purchase of a fixed asset.
(1) [2] (ii) Either Subscriptions prepaid on 1 April 2008 (1) This item represents an amount received during the previous financial year which
relates to the current financial year. Application of matching principle. (1) Or Subscriptions owed by member 31 March 2009 (1) This item represents an amount relating to the current financial year which has not
yet been received. Application of matching principle. (1) Or Rent accrued (1) This item represents an amount relating to the current financial year which has not
yet been received. Application of matching principle. (1) Or Depreciation of equipment (1) This is a non-monetary expense but must be taken into account in calculating the
surplus/deficit. Application of matching principle. (1) Or Deficit for the year (1) This is the difference between the income and expenditure and is the “loss” for the
year and does not represent money paid/received. (1) Alternatively accept surplus with a suitable comment if a surplus is shown in
the answer to (b). [2] [Total: 21]
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5 (a) Selling goods at lower prices Allowing higher rates of trade discount for bulk buying Not passing on increased costs to customers Buying more expensive goods Or other suitable point Any 2 reasons (1) mark each [2] (b) Reduce expenses e.g. reduce staffing levels, reduce advertising etc. Increase gross profit e.g. increase profit margin, increase selling prices etc. Increase other income e.g. rent out part of premises, earn more discount etc. Or other suitable point Any 1 reason (1) mark [1] (c) (i) 25% – 10% = 15% (1) (ii) 21% – 9% = 12% (1) [2] (d) Percentage of expenses to sales has reduced so the efficiency of the business in
controlling expenses has increased. Or suitable answer based on O/F answers to (c) [2] (e) Payment period for creditors
1
365
000 320
500 44× (1) = 50.76 days = 51 days (1)
Collection period for debtors
1
365
000 400
500 38× (1) = 35.13 days = 36 days (1) [4]
(f) In both years the debtors are paying Kalpna Khan earlier than she is paying the
creditors (though the gap is smaller in the second year). (1) She is able to make use of the money within the business for this period. (1) Or other suitable comments up to (2) marks [2]
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(g) Offer cash discount for prompt payment Charge interest on overdue accounts Improve credit control Refuse further supplies on credit until outstanding balance paid Invoice discount and debt factoring Or other relevant points Any 2 points (1) each [2] (h) (i) Non-monetary factors One example – goodwill, quality of management, or other suitable example (1) Such items will not appear on the accounting statements but can influence the
profitability and prospects of a business. (1) (ii) Accounting policies One example – methods of depreciation, methods of stock valuation, or other
suitable example (1) These will affect calculation of the profit and the profitability ratios and the value of
the assets. (1) [4] [Total: 19]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2010 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/11 Paper 11, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2010 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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MARKING GUIDELINES
• Award marks only in accordance with the mark scheme. • Where a candidate makes an arithmetical error or selects the wrong figure in an account or a
calculation, so that totals or the results of the calculation are wrong but are correct on his own figures, he will lose the mark for selecting the original figure but may earn an own figure (OF) mark for the result, total or calculation.
• Where particular wording is shown on the mark scheme accept any reasonable spelling and
abbreviation as long as the meaning is clear. For example, for “Balance brought down” accept Balance b/down, Balance b/d, Balance, Bal
b/down, Bal b/d, Bal, Brought down, b/down, b/d, but not Bbd, bd, or any variation of “Balance carried down”.
• Where a ledger account is to be prepared, each mark is usually for the date, narrative and
amount together. If the candidate has correctly prepared the account but not shown some or all of the dates he may earn some marks according to the mark scheme.
• If a ledger account is completely reversed no marks will be awarded for individual entries but
there may be marks available for own figure balances carried and brought down • Where an answer is to be shown as a ratio, it should be shown as xx:1 and not as 1:xx. An
answer of just the correct figure xx may be accepted but not if any other description such as %, times, days etc is shown and not if shown as negative when it should be positive.
• Where a calculation is to be shown to two decimal places, an answer rounded up or down may
be accepted (e.g. 2.85 or 2.86 if the true answer is 2.853) but not an answer shown to only the nearest whole number or one decimal place (e.g. 2.8 or 3).
• Where dollars and cents are shown in a question and exact cents are required in a calculated
answer (e.g. $35.60) many candidates will show $35.6 as their calculators will suppress the final 0. Although wrong this may be accepted. The $ sign is not required.
• Ledger accounts may be accepted in either two sided or the running balance format and the mark
scheme will show how marks should be allocated. • Where a final account is requested, a list of items will not normally earn any marks. • If candidates are required to prepare a Balance Sheet, either a two sided or a vertical
presentation will be accepted and the mark scheme will show how marks are to be awarded.
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1 Question Number
Key Question Number
Key
(a) C (f) D
(b) D (g) B
(c) B (h) C
(d) B (i) A
(e) C (j) D
[Total: 10] 2 (a) Property (Land and buildings)(only one mark) Fixtures and fittings Plant and equipment (machinery)(only one mark) Office equipment Motor vehicles Any two [2] (b)
Debit entry Credit entry
Sales returns account � (1)
[1] (c) Consistency [1] (d) Net book value = Cost (1) less accumulated depreciation (1) [2] (e) Income statement (Trading and profit and loss account) [1] (must include the word “trading”) (f) Accruals (matching), not prudence [1] (g) (i) Percentage of gross profit to sales = (75 000 (1) – 52 500 (1)) / 75 000 (1) × 100% = 30.00% (1)OF [4] (ii) Percentage of net profit to sales = (22 500 (1)OF – 7 500 (1)) / 75 000 (1) × 100% = 20.00% (1)OF [4] (h) Number of shares = $5 000 (1) / $0.50 = 10 000 (1) Total dividend = 10 000 × $0.15 (1) = $1 500 (1)OF [4] (For 5000 (1) × 0.50 × 0.15 (1) = 375, award 2 marks as shown) [Total: 20]
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3 (a) Sumaru Cash book, April 2010
April Cash Dr $
Bank Dr $
3 9 12 22 28
Ahar (1)* Cash sales (1)* Bannu (1)* Dooly (1)* Eduardo (1)*
4 000 (1)1 500 (1)
2 000 (1)1 650 (1)
900 (1)
*Mark is for date and name [10] (b)
Name of account Dr $
Cr $
Sales (1) (accept cash sales but not sales ledger)
4000 (1)
[2] (c)
Date Dr Cr
30 April Suspense (1) 360 (1)
Cash book (bank) (1) 360 (1)
To correct balance entered at 1 April 2010 (1)
(Award marks for amount only if correctly shown as Dr or Cr with account name.) [5] (d) Send statement Offer cash discount (not trade discount) Limit credit (no more credit sales) Charge interest on overdue amounts Use debt collection methods (any two, 2 marks each) [4] [Total: 21]
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4 (a) (i) Lower (1) of cost (1) and net realisable value (1) [3] (ii) $2 700 (1) [1] (iii) Reduces profit (not overstated or understated) (1) by $300 (1) [2] (b) Timpani Limited Balance Sheet at 31 March 2010 $ $ Non-current (fixed) assets Plant and equipment at cost 20 000 (1) Accumulated depreciation 12 000 (1) Net book value 8 000 (1) Current assets Inventory (stock) 2 700 (1) Trade receivables (debtors) 1 000 (1) Bank 500 (1) 4 200 Current Liabilities Trade payables (creditors) 700 (1) Bank loan (must be shown as current liability) 2 800 (1) 3 500 Net current assets 700 Total assets 8 700 Equity Share capital 5 000 (1) Profit for the year 3 700 (2) 8 700 Note: award marks for acceptable layout, not list of balances. [11] (c)
Successful Not Successful
Reduce dividend � (2)
Reduce depreciation � (2)
Reduce trade payables (creditors) � (2)
[6] (d) (i) Going concern (1) (ii) Expected sale values (2) [3] (accept net realisable value) [Total: 26]
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5 (a)
Capital Revenue
Hire charges � (2)
Cash discount received from motor dealer for prompt payment for new car
� (2)
Part exchange value of used car � (2)
[6] (b) (i) Cost $12 000 (1) @ 30% (1) = $3 600 (1)OF [3] (Award only the component marks but not the mark for $3600 if other calculations are
shown, e.g. net book value or for other years.) (ii) Net book value = $8 400 (1)OF [1] (Award this mark if correct by reference to answer to (i).) (c) Disposal of motor vehicles
2010 $ 2010 $ April 1 Motor vehicle* 12 000 (1) 12 000
April 1 Depreciation* 3 600 (1) Bank (Insurance) 5 000 (1) Income statement 3 400 (2)OF (Profit & loss account) 12 000
(Mark is for reasonable narrative and amount, not date.) (*Award 2 marks for “Net book value 8400”, but 0 for “Balance b/down 8400”.) [5] (d) (i) The rate may be too low as large loss arose on scrapping car. An increased rate, up to 60%, would reduce loss. [2] (Award marks for similar comments.) (ii) Straight line method (1) over life of car, or using scrap value (1) or Based on estimated mileage over three years (2) or other reasonable suggestion and explanation. [2] [Total: 19]
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6 (a) $ Deposits to bank 15 270 (1) Less: cash sales 2 680 (1) 12 590 Add: receivables at 31/3/10 4 080 (1) 16 670 Less: receivables at 1/4/09 3 140 (1) Credit sales 13 530 (1)OF (Award total figure only if no aliens, e.g. cash book balance b/fwd shown.) [5] (b) Wilma Trading account for the year ended 31 March 2010 $ $ Revenue (sales) – credit 13 530 (1)OF – cash 2 680 (1) 16 210 Inventory (stock) at 1 April 2009 1 780 (1) Purchases 9 560 (1) Carriage inwards 280 (1) 11 620 Inventory (stock) at 31 March 2010 1 920 (1) Cost of goods sold 9 700 (1)OF Gross profit 6 510 (1)OF [8] (c) (i) Rate of inventory (stock) turnover = Cost of goods sold / average inventory (stock) = 9 700 (1)OF / [(1 780 + 1 920)/2 = 1 850 (1)OF] = 5.24 (1)OF times (1) [4] (Note – a calculation mark may be awarded even if the formula is wrong.) (ii) Collection period for trade receivables (debtors) = (Debtors / credit sales) × 365 days = (4 080 (1) / 13 530 (1)OF) × 365 days = 110 (1)OF (accept 111) days (1) [4] (Note – a calculation mark may be awarded even if the formula is wrong.) (d)
Increase Decrease No change Gross profit � (1) Percentage of gross profit to sales � (1) Rate of inventory (stock) turnover � (1)
[3] [Total: 24]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2010 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/12 Paper 12, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2010 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
Prepared by D. El-Hoss
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© UCLES 2010
MARKING GUIDELINES
• Award marks only in accordance with the mark scheme. If a script contains an answer which is not anticipated please refer to Principal Examiner before awarding any marks.
• Where a candidate makes an arithmetical error or selects the wrong figure in an account or a
calculation, so that totals or the results of the calculation are wrong but are correct on his own figures, he will lose the mark for selecting the original figure but may earn an own figure (OF) mark for the result, total or calculation.
• Where particular wording is shown on the mark scheme accept any reasonable spelling and
abbreviation as long as the meaning is clear. • For example, for “Balance brought down” accept Balance b/down, Balance b/d, Balance, Bal
b/down, Bal b/d, Bal, Brought down, b/down, b/d, but not Bbd, bd, or any variation of “Balance carried down”.
• If a candidate gives two alternative answers without crossing one out, mark both answers and
give credit for the better answer. If one is crossed out, mark the other answer. • Where a ledger account is to be prepared, each mark is usually for the date, narrative and
amount together. If the candidate has correctly prepared the account but not shown some or all of the dates, he may earn some marks according to the mark scheme.
• If a ledger account is completely reversed, no marks will be awarded for individual entries but
there may be marks available for own figure balances carried and brought down. • Where an answer is to be shown as a ratio, it should be shown as xx:1 and not as 1:xx.
An answer of just the correct figure xx may be accepted but not if any other description such as %, times, days etc. is shown and not if shown as negative when it should be positive.
• Where a calculation is to be shown to two decimal places, an answer rounded up or down may
be accepted (e.g. 2.85 or 2.86 if the true answer is 2.853) but not an answer shown to only the nearest whole number or one decimal place (e.g. 2.8 or 3).
• Where dollars and cents are shown in a question and exact cents are required in a calculated
answer (e.g. $35.60), many candidates will show $35.6, as their calculators will suppress the final 0. Although wrong this may be accepted. The $ sign is not required.
• Ledger accounts may be accepted in either two sided or the running balance format and the mark
scheme will show how marks should be allocated. • Where a final account is requested, a list of items will not normally earn any marks. • If candidates are required to prepare a Balance Sheet, either a two sided or a vertical
presentation will be accepted and the mark scheme will show how marks are to be awarded.
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1 Question Number
Key Question Number
Key
(a) B (f) B
(b) A (g) A
(c) A (h) D
(d) A (i) A
(e) B (j) D
[Total marks: 10] 2 (a) Return on capital employed ( or Return on Net Assets ). Percentage of gross profit to sales or GP margin or GP%. Percentage of net profit to sales or NP margin or NP%. Any two, (1) each [2] (b)
Current asset Current liability
Inventory (stock) � (1)
Trade payables (creditors) � (1)
Other receivables (prepayments) � (1)
[3] (c)
Bank column Cash column
Debit side
Credit side � (1)
If more than one tick then 0 [1] (d) Income statement (trading/profit and loss account) [1] (e) Error of principle [1] (f) Matching or prudence or conservatism [1]
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(g) (i) rate of inventory (stock) turnover = cost of goods sold/average stock = ( OS + Purch + CI – CS ) [*1 for + CI; 1 for other figs]
= above) as *(2
(1) 800 4 600)/2 5 000 (4
400 46 600) 5 - 500 2 500 45 000 (4
=+
=++
= 9.66 times (1)OF [4] (ii) Payment period for trade payables = creditors / credit purchases × 365 days = 3 750 (1)/45 500 (1) × 365 days = 30 days (2) (to nearest whole day) [OF for correct formula] [4] (h) Hooper – wages account _____________________________________________________ Bank (Cash) 32 800 (1) Balance b/d 300 (1) (or Accruals) Balance c/d 450 (1) Income statement 32 950 (1) OF (or Accruals) (Profit & Loss account) 33 250 33 250 Balance b/d 450 (1) [5] Narrative and amount for mark No aliens or extraneous items for OF
[Total marks: 22] 3 (a) (i) Arthur $30 000 × 3% (1) = $900 (1) OF [2] (ii) Nancy $40 000 × 3% (1) = $1 200 (1) OF [2] (b) (i) Arthur $35 000 × 4% (1) = $1 400 (1) OF [2] (ii) Nancy $15 000 × 4% (1) = $600 (1) OF [2]
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(c) Net profit 89 000 Interest on drawings 2 000 (1)OF 91 000 Less salary 15 000 (1) Interest on capital 2 100 (1)OF 17 100 Residual profit 73 900 Shared 2:3 Arthur:Nancy Arthur 29 560 (2)OF as below Nancy 44 340 (2)OF as below 73 900 2 OF for profit share only if based on Profit (not Capital ) 1 OF for profit share if any aliens (Drawings) [7] (d) Arthur – current account _____________________________________________________ Interest on drawings 1 400 (1)OF Interest on capital 900 (1) OF Drawings 35 000 (1) Salary 15 000 (1) Balance c/d 9 060 (1)OF Residual profit 29 560 (1)OF 45 460 45 460 Balance b/d 9 060 No OF if aliens or extraneous items [6] (e)
Increase � (2)
Reduce
Unchanged
[2] [Total marks: 23] 4 (a) Used to prepare final accounts. Can trace or identify errors. Other sensible comment. One reason [1]
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(b) Deali Trial Balance at 31 March 2010 $ $ Revenue (sales) 125 000 (1) Inventory (stock) 14 500 (1) Purchases 76 000 (1) Bank (overdraft) 2 300 (1) Equipment 9 000 (1) Trade receivables (debtors) 1 700 (1) Trade payables (creditors) 2 800 (1) Expenses 37 500 (1) Capital 15 500 (1) Drawings 8 000 (1) Suspense 1 100 (1)OF 146 700 146 700 OF only if arithmetically correct [11] (c) Dr Cr
Suspense (1) 1 100 (1)
Revenue (sales) (1) 1 100 (1)
Sales omitted from the ledger (1) must be related to error
Marks for narrative not dependent upon correct figures. Marks carried with narrative. [5]
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(d) Deali Summary Income Statement (Trading and Profit and Loss Account)
for the year ended 31 March 2010 $ $ Revenue (sales) (1) Inventory (stock) at 1 April 2009 (1) Purchases (1) Inventory (stock) at 31 March 2010 (1) Cost of sales (1) OF Gross profit (1) OF Expenses (1) Net profit (1) OF
[8]
[Total marks: 25] 5 (a) (i) A bad debt is an amount owing to the business (1) which the debtor is unable or
unwilling to pay (1). [2] (ii) A provision for doubtful debts is an estimate (not %)(1) of the amount likely to be lost
through bad debts (1). [2] (b)
Dr $
Cr $
Bad debts (income statement) (1) (profit and loss account)
850 (1)
Veeku ) )(1) or Debtors (1)
300 ) )(1)
Wlanda ) )
550 ) )
[4]
126 100
14 500
76 000
90 500
72 500
53 600
37 500
16 100
18 000
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(c) Balance on sales ledger 12 600 (1) Less: bad debts written off 850 (1) 11 750 Provision for doubtful debts @ 4% = 470 (1)OF [3] (d)
Dr $
Cr $
Income statement (1) (Profit and Loss account)
470 (1) OF
Provision for doubtful debts(1) 470 (1) OF
[4] (e) Bad debts account ____________________________________________________ Debtors 850 (1) Income statement 850 (1) (Profit and loss) or Veeku 300 Wland 550 [2] Provision for doubtful debts account ____________________________________________________ Balance c/d 470 Income statement 470 (1) OF (Profit and loss) Balance b/d 470 (1) OF [2] (f) Bad debts recovered account ____________________________________________________ Income statement 300 (1) Bank (Cash/Veeku) 300 (1) (Profit and loss) OF [2] [Total marks: 21]
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6 (a) Managers, bank or other lender, creditors, customers, suppliers. Employees, Government, competitors, potential investors. Other acceptable comment. Any two, 2 marks each [4] (b)
Capital Revenue
New factory extension � (1)
Repainting old factory � (1)
Architect’s fees for designing extension � (1)
New plant and equipment for extension � (1)
[4] (c) (i) Factory cost 30 000 (1) + Architect’s fees 3 000 (1) Total cost 33 000 Over useful life 20 years 20 (1) = 1 650 (1) OF [4] (ii) Plant and equipment 6 000 – residual value 800 = 5 200 5 200 (1) Over useful life 4 years (1) = 1 300 (1) OF [3] (d) Land has an indefinite expected life. Land does not wear out. Land is not consumed by use. Land increases in value over time. Other acceptable comment (allow NEVER). Any two, 2 each [4]
[Total marks: 19]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2010 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/13 Paper 13, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2010 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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MARKING GUIDELINES
• Award marks only in accordance with the mark scheme. If a script contains an answer which is not anticipated please refer to Principal Examiner before awarding any marks.
• Where a candidate makes an arithmetical error or selects the wrong figure in an account or a
calculation, so that totals or the results of the calculation are wrong but are correct on his own figures, he will lose the mark for selecting the original figure but may earn an own figure (OF) mark for the result, total or calculation.
• Where particular wording is shown on the mark scheme accept any reasonable spelling and
abbreviation as long as the meaning is clear. • For example, for “Balance brought down” accept Balance b/down, Balance b/d, Balance, Bal
b/down, Bal b/d, Bal, Brought down, b/down, b/d, but not Bbd, bd, or any variation of “Balance carried down”.
• If a candidate gives two alternative answers without crossing one out, mark both answers and
give credit for the better answer. If one is crossed out, mark the other answer. • Where a ledger account is to be prepared, each mark is usually for the date, narrative and
amount together. If the candidate has correctly prepared the account but not shown some or all of the dates, he may earn some marks according to the mark scheme.
• If a ledger account is completely reversed, no marks will be awarded for individual entries but
there may be marks available for own figure balances carried and brought down. • Where an answer is to be shown as a ratio, it should be shown as xx:1 and not as 1:xx.
An answer of just the correct figure xx may be accepted but not if any other description such as %, times, days etc. is shown and not if shown as negative when it should be positive.
• Where a calculation is to be shown to two decimal places, an answer rounded up or down may
be accepted (e.g. 2.85 or 2.86 if the true answer is 2.853) but not an answer shown to only the nearest whole number or one decimal place (e.g. 2.8 or 3).
• Where dollars and cents are shown in a question and exact cents are required in a calculated
answer (e.g. $35.60), many candidates will show $35.6, as their calculators will suppress the final 0. Although wrong this may be accepted. The $ sign is not required.
• Ledger accounts may be accepted in either two sided or the running balance format and the mark
scheme will show how marks should be allocated. • Where a final account is requested, a list of items will not normally earn any marks. • If candidates are required to prepare a Balance Sheet, either a two sided or a vertical
presentation will be accepted and the mark scheme will show how marks are to be awarded.
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1 Question Number
Key Question Number
Key
(a) B (f) B
(b) A (g) A
(c) A (h) D
(d) A (i) A
(e) B (j) D
[Total marks: 10] 2 (a) Return on capital employed ( or Return on Net Assets ). Percentage of gross profit to sales or GP margin or GP%. Percentage of net profit to sales or NP margin or NP%. Any two, (1) each [2] (b)
Current asset Current liability
Inventory (stock) � (1)
Trade payables (creditors) � (1)
Other receivables (prepayments) � (1)
[3] (c)
Bank column Cash column
Debit side
Credit side � (1)
If more than one tick then 0 [1] (d) Income statement (trading/profit and loss account) [1] (e) Error of principle [1] (f) Matching or prudence or conservatism [1]
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(g) (i) rate of inventory (stock) turnover = cost of goods sold/average stock = ( OS + Purch + CI – CS ) [*1 for + CI; 1 for other figs]
= above) as *(2
(1) 800 4 600)/2 5 000 (4
400 46 600) 5 - 500 2 500 45 000 (4
=+
=++
= 9.66 times (1)OF [4] (ii) Payment period for trade payables = creditors / credit purchases × 365 days = 3 750 (1)/45 500 (1) × 365 days = 30 days (2) (to nearest whole day) [OF for correct formula] [4] (h) Hooper – wages account _____________________________________________________ Bank (Cash) 32 800 (1) Balance b/d 300 (1) (or Accruals) Balance c/d 450 (1) Income statement 32 950 (1) OF (or Accruals) (Profit & Loss account) 33 250 33 250 Balance b/d 450 (1) [5] Narrative and amount for mark No aliens or extraneous items for OF
[Total marks: 22] 3 (a) (i) Arthur $30 000 × 3% (1) = $900 (1) OF [2] (ii) Nancy $40 000 × 3% (1) = $1 200 (1) OF [2] (b) (i) Arthur $35 000 × 4% (1) = $1 400 (1) OF [2] (ii) Nancy $15 000 × 4% (1) = $600 (1) OF [2]
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(c) Net profit 89 000 Interest on drawings 2 000 (1)OF 91 000 Less salary 15 000 (1) Interest on capital 2 100 (1)OF 17 100 Residual profit 73 900 Shared 2:3 Arthur:Nancy Arthur 29 560 (2)OF as below Nancy 44 340 (2)OF as below 73 900 2 OF for profit share only if based on Profit (not Capital ) 1 OF for profit share if any aliens (Drawings) [7] (d) Arthur – current account _____________________________________________________ Interest on drawings 1 400 (1)OF Interest on capital 900 (1) OF Drawings 35 000 (1) Salary 15 000 (1) Balance c/d 9 060 (1)OF Residual profit 29 560 (1)OF 45 460 45 460 Balance b/d 9 060 No OF if aliens or extraneous items [6] (e)
Increase � (2)
Reduce
Unchanged
[2] [Total marks: 23] 4 (a) Used to prepare final accounts. Can trace or identify errors. Other sensible comment. One reason [1]
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(b) Deali Trial Balance at 31 March 2010 $ $ Revenue (sales) 125 000 (1) Inventory (stock) 14 500 (1) Purchases 76 000 (1) Bank (overdraft) 2 300 (1) Equipment 9 000 (1) Trade receivables (debtors) 1 700 (1) Trade payables (creditors) 2 800 (1) Expenses 37 500 (1) Capital 15 500 (1) Drawings 8 000 (1) Suspense 1 100 (1)OF 146 700 146 700 OF only if arithmetically correct [11] (c) Dr Cr
Suspense (1) 1 100 (1)
Revenue (sales) (1) 1 100 (1)
Sales omitted from the ledger (1) must be related to error
Marks for narrative not dependent upon correct figures. Marks carried with narrative. [5]
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(d) Deali Summary Income Statement (Trading and Profit and Loss Account)
for the year ended 31 March 2010 $ $ Revenue (sales) (1) Inventory (stock) at 1 April 2009 (1) Purchases (1) Inventory (stock) at 31 March 2010 (1) Cost of sales (1) OF Gross profit (1) OF Expenses (1) Net profit (1) OF
[8]
[Total marks: 25] 5 (a) (i) A bad debt is an amount owing to the business (1) which the debtor is unable or
unwilling to pay (1). [2] (ii) A provision for doubtful debts is an estimate (not %)(1) of the amount likely to be lost
through bad debts (1). [2] (b)
Dr $
Cr $
Bad debts (income statement) (1) (profit and loss account)
850 (1)
Veeku ) )(1) or Debtors (1)
300 ) )(1)
Wlanda ) )
550 ) )
[4]
126 100
14 500
76 000
90 500
72 500
53 600
37 500
16 100
18 000
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(c) Balance on sales ledger 12 600 (1) Less: bad debts written off 850 (1) 11 750 Provision for doubtful debts @ 4% = 470 (1)OF [3] (d)
Dr $
Cr $
Income statement (1) (Profit and Loss account)
470 (1) OF
Provision for doubtful debts(1) 470 (1) OF
[4] (e) Bad debts account ____________________________________________________ Debtors 850 (1) Income statement 850 (1) (Profit and loss) or Veeku 300 Wland 550 [2] Provision for doubtful debts account ____________________________________________________ Balance c/d 470 Income statement 470 (1) OF (Profit and loss) Balance b/d 470 (1) OF [2] (f) Bad debts recovered account ____________________________________________________ Income statement 300 (1) Bank (Cash/Veeku) 300 (1) (Profit and loss) OF [2] [Total marks: 21]
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6 (a) Managers, bank or other lender, creditors, customers, suppliers. Employees, Government, competitors, potential investors. Other acceptable comment. Any two, 2 marks each [4] (b)
Capital Revenue
New factory extension � (1)
Repainting old factory � (1)
Architect’s fees for designing extension � (1)
New plant and equipment for extension � (1)
[4] (c) (i) Factory cost 30 000 (1) + Architect’s fees 3 000 (1) Total cost 33 000 Over useful life 20 years 20 (1) = 1 650 (1) OF [4] (ii) Plant and equipment 6 000 – residual value 800 = 5 200 5 200 (1) Over useful life 4 years (1) = 1 300 (1) OF [3] (d) Land has an indefinite expected life. Land does not wear out. Land is not consumed by use. Land increases in value over time. Other acceptable comment (allow NEVER). Any two, 2 each [4]
[Total marks: 19]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2010 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/21 Paper 21, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2010 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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1 (a) To remove small cash payments from the main cash book. To reduce the number of entries in the main cash book and the expenses in the ledger. To allow the chief cashier to delegate some of the work. Or other suitable reason. Any 2 reasons (1) each. [2] (b) The petty cashier starts each period with the same amount of money (1). At the end of the period the chief cashier will make up the cash remaining so that it is equal
to the imprest amount (1). [2] (c) The chief cashier is aware of exactly how much is spent in each period. The cash remaining and the total of the vouchers received should always be equal to the
imprest amount. Or other suitable advantage. Any 1 advantage (1). [1] (d) The petty cashier will receive $88. [1] (e) (i) Debit travelling expenses account with $11. [2] (ii) Debit N Jones account with $21 (2). Debit W Smith account with $18 (2). [4] (f) To spread the cost of fixed assets over their useful lives. To apply the accruals principle – recognising the time difference between payment for the
fixed asset and its loss in value. To provide a more realistic view of the fixed assets. To record the loss in value of fixed assets – the part of the cost of the fixed asset consumed
during the period of use. The annual depreciation charge represents the cost of using the fixed asset to earn revenue. Or other acceptable reason. Any 2 reasons (1). [2] (g) Where a choice of method is available, the one with the most realistic outcome should be
selected and used consistently from one accounting period to the next. [2]
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(h) (i) Straight line (equal instalment) method $ Cost 8000 Less scrap value 500 7500 Annual depreciation 7500 (1) = $2500 (1) 3 years (1) [3]
(ii) Reducing (diminishing) balance method
$ Cost 8000 Depreciation for year ending 31 January 2011 (60% × 8000) 4800 (1) 3200 Depreciation for year ending 31 January 2012 (60% × 3200) 1920 (1) 1280 Depreciation for year ending 31 January 2013 (60% × 1280) 768 (1) 512
[3] [Total: 22]
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2 (a) To calculate how much it has cost the business to manufacture the goods produced in the financial year. [2]
(b) Production did not meet demand. It was cheaper to buy the goods rather than make them. Those particular items could not be made by the business. Or other suitable reason. Any 2 reasons (1) each. [2] (c) Ahmed Zaki Manufacturing Account for the year ended 30 April 2010
$ $ Opening inventory (stock) of raw materials 33 400 (1) Purchases of raw materials 408 160 (1) 441 560 Less Closing inventory (stock) of raw materials 35 230 (1) 406 330 Direct factory wages 325 270 (1) Prime cost 731 600 (1) Factory overheads Indirect factory wages (130 200 + 1520) 131 720 (1) Factory general expenses (198 280 – 400) 197 880 (1) Depreciation factory machinery (162 000 + 19 500 – 150 000) 31 500 (2) 361 100 1 092 700 (1)O/F Add Opening work in progress 14 200 (1) 1 106 900 Less Closing work in progress 13 900 (1) Cost of production 1 093 000 (1)O/F Horizontal format acceptable [13]
[Total: 17]
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3 (a) Provision for doubtful debts 2½% × (15 530 – 90) (1) = $386 (1) [2] (b) Journal
(i)
(ii)
(iii)
Bad debts K Singh Bad debt written off (1) Income statement (profit and loss) Bad debts Transfer of total bad debts written off to income statement (profit and loss) (1) Income statement (profit and loss) Provision for doubtful debts Creation of provision for doubtful debts (1)
Debit $ 90 (1) 300 (1) 386 (1)O/F
Credit $ 90 (1) 300 (1) 386 (1)O/F
[9] (c) Shilpa Gandhi Extract from Balance Sheet at 31 January 2010
Current Assets $ $ Trade receivables (trade debtors) 15 440 Less Provision for doubtful debts 386 (1)O/F 15 054 (1)O/F
[2] (d) Calculation of total value of inventory (stock)
$ Type A 360 units × $23 per unit 8 280 (2) Type B (520 – 40) units × $12 per unit 5 760 (2) 14 040 (1)O/F
[5] (e) Either Prudence Or Consistency [1] [Total: 19]
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4 (a) (i) Mark-up is the gross profit measured as a percentage of the cost price. [1] (ii) Margin is the gross profit measured as a percentage of the selling price. [1] (b) (i) Cost of sales = (25 200 + 347 200) – 28 000 = 344 400 (1) Gross profit = 430 500 – 344 400 = 86 100 (1)
Percentage profit mark-up = 400 344
100 86O/F ×
1
100 (1)O/F = 25% (1)O/F [4]
(ii) Sales = 430 500 Gross profit = 86 100
Percentage profit margin = 500 430
100 86
O/F
O/F ×
1
100 (1)O/Fs = 20% (1)O/F [2]
(c) Increase selling prices. Obtain cheaper supplies. Change mix of sales. Or other acceptable point. Any 2 points (1) each. [2] (d) Current assets = 28 000 + 36 300 + 100 = 64 400 } Current liabilities = 29 600 + 13 200 = 42 800 } (1) Current ratio = 64 400 : 42 800 (1) = 1.50 : 1 (1) [3] (e) Liquid assets = 36 300 + 100 = 36 400 } Current liabilities = 29 600 + 13 200 = 42 800 } (1) Quick ratio = 36 400 : 42 800 (1) = 0.85 : 1 (1) [3] (f) Answer to be based on O/Fs in (e). Not satisfied (1) Immediate liabilities cannot now be met out of liquid assets without selling stock (2). Or other suitable comment. [3] (g) (ii) No effect (1) (iii) Decrease (1) [2] [Total: 21]
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5 (a) (i) Preference shares: Receive a fixed rate of dividend. The dividend is paid before the ordinary share dividend. Preference shares do not usually carry voting rights. Capital is returned before the ordinary share capital in a winding up. Any 2 points (2) each. [4] (ii) Ordinary shares: They are also known as equity shares. The dividend is paid after the preference share dividend. The dividend may vary according to profits. Ordinary shares usually carry voting rights. Ordinary shares are the last to be repaid in a winding up. Any 2 points (2) each. [4] (b) Ellis Ltd Extract from Balance Sheet at 31 March 2010
Capital and Reserves $ 100 000 5% Preference shares of $1 each 100 000 (2) 600 000 Ordinary shares of $.50 each 300 000 (2) Profit and Loss account (retained profits) (10 000 (1) + 5000 (1)) 15 000
[6] (c) Ellis Ltd Extract from Balance Sheet at 31 March 2010
Current liabilities $ Other payables – Debenture interest (4% × 100 000) 4 000 (2) Preference share dividend (5% × 100 000) 5 000 (2) Ordinary share dividend ($0.05 × 600 000 shares) 30 000 (2)
[6] [Total: 20]
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6 (a) To avoid misunderstandings/disagreements later. [2] (b) (i) To discourage the partners from making excessive drawings. [2] (ii) To compensate for an unequal work-load. OR In recognition of work done in the business. [2] (c) Ben and Jane Mwanga Profit and Loss Appropriation Account for the year ended 31 March 2010
$ $ Profit for the year (net profit) 12 000 (1) Add Interest on drawings – Ben 320 (1) Jane 600 (1) 920 12 920 Less Interest on capital – Ben 3 000 (1) Jane 1 800 (1) 4 800 Partners’ salary – Jane 10 000 (1) 14 800 (1 880) Share of loss – Ben (1 175) (1)O/F Jane (705) (1)O/F (1 880)
[8] (d) Ben and Jane Mwanga Statement of corrected profit for the year ended 31 March 2010
$ Profit for the year (net profit) before corrections 12 000 Increase Decrease in profit in profit $ $ Error 1 1000 2 30 (2) 3 No effect (2) 4 ____ 50 (2) 1000 80 920 Corrected profit for the year 12 920 (1)O/F
[7] [Total: 21]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2010 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/22 Paper 22, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2010 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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1 (a) The bank statement is a copy of the account of the business as it appears in the books of the bank. This is from the viewpoint of the bank – the business depositing money is a creditor of the bank. (2)
The bank account in the cash book is prepared from the viewpoint of the business – the bank
is a debtor of the business which has deposited the money. (2) [4] (b) Cash Book (bank columns only) 2010 $ 2010 $ May 1 Dividend 262 (1) May 1 Balance b/d 1668 (1) Error correction (1) 100 (1) Bank charges 38 (1) Balance c/d 1344 (1) 1706 1706 May 1 Balance b/d 1344 (1)OF [7] (c) Bank Reconciliation Statement at 1 May 2010 $ $ Balance shown on bank statement (1600) (1) Add amounts not yet credited – cash sales (1) 650 (1) (950) Less cheques not yet presented – Peter Smith (1) 344 (1) bank error (1) 50 (1) 394 Balance shown in cash book (1344) (1)OF [8] (c) Alternative presentation Bank Reconciliation Statement at 1 May 2010 $ $ Balance shown in cash book (1344) (1)OF Less cheques not yet presented – Peter Smith (1) 344 (1) bank error (1) 50 (1) 394 (950) Add amounts not yet credited – cash sales (1) 650 (1) Balance shown on bank statement (1600) (1) [8] (d) Answer to be based on OF balance in (b) $1344 (1) OF Liability (1) OF [2]
[Total: 21]
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2 (a) The liability of the members (shareholders) of a company for the debts of the company is limited to the amount they agree to pay the company for their shares. [2]
(b) Preference shares receive a fixed rate of dividend: debentures receive a fixed rate of
interest. Preference shareholders are members of the company: debenture holders are not members
of the company. Preference shares are part of the capital of the company: debentures are long term loans. Preference shareholders are repaid after the debenture holders in the event of the company
being wound up. Any 2 points (2) each [4] (c) (i) Authorised capital is the maximum amount of share capital a company is allowed to
issue. (2) (ii) Called-up capital is the total amount of capital a company has requested from its
shareholders. (2) (iii) Paid-up capital is that part of the called up capital for which a company has actually
received the money from its shareholders. (2) [6] (d) DEC Ltd Profit and Loss Appropriation Account for the year ended 31 March 2010 $ $ Profit for the year (net profit) 22 000 (1) Less Transfer to general reserve 3 000 (1) Dividends paid – Preference 1 400 (2) Dividends proposed – Preference 2 800 (2) Ordinary 12 000 (2) 19 200 Retained profit for the year 2 800 (1) Retained profit brought forward (profit & loss balance) 4 300 (1) Retained profit carried forward 7 100 (1)OF
[11]
[Total: 23]
Prepared by D. El-Hoss
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Page 4 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2010 0452 22
© UCLES 2010
3 (a) A narrative explains the reasons for the entries which are to be made in the ledger. [2] (b) Journal
Debit $
Credit $
Zaffar Khan Zubin Khan Correction of error Zaffar Khan incorrectly credited (1) Equipment Office expenses Correction of error equipment debited to office expenses (1) Stationery Purchases Correction of error stationery debited to purchases account (1) Sales returns Mariam Sitar Correction of error no entry made for sales returns (1)
170 (1)
1000 (1)
19 (1)
25 (1)
170 (1)
1000 (1)
19 (1)
25 (1)
[12] (c) Error 2 Effect – Increase (1) Reason – Expenses are being reduced so the profit increases. (2) Error 3 Effect – No effect (1) Reason – The cost of sales is being reduced, but the expenses are being
increased. The profit does not alter. (2) Error 4 Effect – Decrease (1) Reason – The sales are being decreased so the profit will also decrease. (2) [9]
[Total: 23]
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IGCSE – May/June 2010 0452 22
© UCLES 2010
4 (a) Balance 1 April 2009 Explanation – This is the amount of rates (property tax) prepaid during the previous
financial year which related to the current financial year. (2) Double entry – credit rates (property tax) account for year ended 31 March 2009. (1) Bank 1 July 2010 Explanation – This is the total amount of rates (property tax) paid by cheque. (2) Double entry – credit bank column in cash book. (1) Income statement (profit and loss) 31 March 2010 Explanation – This is the rates (property tax) relating to the current financial year
transferred to the income statement (profit and loss). (2) Double entry – debit income statement (profit and loss). (1)
[9] (b) The balance represents the amount of rates (property tax) still outstanding for the financial
year ended 31 March 2010. [2] (c) (i) The accruals (matching) principle requires the revenue of the accounting period to be
matched against the costs of the same period. (2) (ii) The total rates relating to the financial year ended 31 March 2010 were transferred to the
income statement. (2) [4] (d) Business entity [1] (e) Realisation [1]
[Total: 17]
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Page 6 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2010 0452 22
© UCLES 2010
5 (a) Accountant – service business (1) Baker – trading business (1) Travel agent – service business (1) [3] (b) Calculation of fees $ Cheques received during the year 21 250 (1) Add amounts owing 30 April 2010 1 820 (1) 23 070 Less amounts owing 1 May 2009 1 770 (1) Fees for the year 21 300 (1) Calculation in ledger account format acceptable [4] (c) Martha Musa Income Statement (Profit and Loss Account) for the year ended 30 April 2010 $ $ Fees 21 300 (1)OF Rent received (2750 – 150) 2 600 (2) 23 900 Rates (property tax) and insurance 1 660 (1) General expenses (7710 + 230) 7 940 (2) Loss on disposal (6000 – 4000 – 1800) 200 (2) Depreciation – office equipment (25% × 8000 × 6 months) 1 000 (2) 10 800 Profit for the year (net profit) 13 100 (1)OF Horizontal format acceptable [11]
[Total: 18]
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Page 7 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2010 0452 22
© UCLES 2010
6 (a) (i) (2)(1)
29.63%1
100
000 54
000) 38 - 000 (54=×
(ii) (2)(1)
12.96%1
100
000 54
000) 9 - 000 (16=× [6]
(b) All comments and reasons to be based on OFs from (a) Gross profit percentage has fallen from 35.50% to 29.63%. Is earning $29.63 per $100 sales compared to $35.50 previously. The business is less profitable in respect of gross profit. Or other suitable comment Any 1 comment (2) Reduction in selling prices. Increase in cost of supplies. Change in proportions of different goods. Not passing on increased costs to customers. Or other acceptable reason Any 1 reason (2) Net profit percentage has increased from 10.45% to 12.96%. Is earning $12.96 per $100 sales compared to $10.45 previously. The business is more profitable. Or other suitable comment Any 1 comment (2) Increased control of expenses. Change in types of expenses. Or other acceptable reason Any 1 reason (2) [8] (c) Cannot meet liabilities when they are due. May experience difficulties in obtaining further supplies on credit. Cannot take advantage of cash discounts. Cannot take advantage of business opportunities as they arise. Any 2 points (2) each [4]
[Total: 18]
Prepared by D. El-Hoss
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2010 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/23 Paper 23, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• CIE will not enter into discussions or correspondence in connection with these mark schemes. CIE is publishing the mark schemes for the May/June 2010 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
Prepared by D. El-Hoss
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1 (a) The bank statement is a copy of the account of the business as it appears in the books of the bank. This is from the viewpoint of the bank – the business depositing money is a creditor of the bank. (2)
The bank account in the cash book is prepared from the viewpoint of the business – the bank
is a debtor of the business which has deposited the money. (2) [4] (b) Cash Book (bank columns only) 2010 $ 2010 $ May 1 Dividend 262 (1) May 1 Balance b/d 1668 (1) Error correction (1) 100 (1) Bank charges 38 (1) Balance c/d 1344 (1) 1706 1706 May 1 Balance b/d 1344 (1)OF [7] (c) Bank Reconciliation Statement at 1 May 2010 $ $ Balance shown on bank statement (1600) (1) Add amounts not yet credited – cash sales (1) 650 (1) (950) Less cheques not yet presented – Peter Smith (1) 344 (1) bank error (1) 50 (1) 394 Balance shown in cash book (1344) (1)OF [8] (c) Alternative presentation Bank Reconciliation Statement at 1 May 2010 $ $ Balance shown in cash book (1344) (1)OF Less cheques not yet presented – Peter Smith (1) 344 (1) bank error (1) 50 (1) 394 (950) Add amounts not yet credited – cash sales (1) 650 (1) Balance shown on bank statement (1600) (1) [8] (d) Answer to be based on OF balance in (b) $1344 (1) OF Liability (1) OF [2]
[Total: 21]
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Page 3 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2010 0452 23
© UCLES 2010
2 (a) The liability of the members (shareholders) of a company for the debts of the company is limited to the amount they agree to pay the company for their shares. [2]
(b) Preference shares receive a fixed rate of dividend: debentures receive a fixed rate of
interest. Preference shareholders are members of the company: debenture holders are not members
of the company. Preference shares are part of the capital of the company: debentures are long term loans. Preference shareholders are repaid after the debenture holders in the event of the company
being wound up. Any 2 points (2) each [4] (c) (i) Authorised capital is the maximum amount of share capital a company is allowed to
issue. (2) (ii) Called-up capital is the total amount of capital a company has requested from its
shareholders. (2) (iii) Paid-up capital is that part of the called up capital for which a company has actually
received the money from its shareholders. (2) [6] (d) DEC Ltd Profit and Loss Appropriation Account for the year ended 31 March 2010 $ $ Profit for the year (net profit) 22 000 (1) Less Transfer to general reserve 3 000 (1) Dividends paid – Preference 1 400 (2) Dividends proposed – Preference 2 800 (2) Ordinary 12 000 (2) 19 200 Retained profit for the year 2 800 (1) Retained profit brought forward (profit & loss balance) 4 300 (1) Retained profit carried forward 7 100 (1)OF
[11]
[Total: 23]
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Page 4 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2010 0452 23
© UCLES 2010
3 (a) A narrative explains the reasons for the entries which are to be made in the ledger. [2] (b) Journal
Debit $
Credit $
Zaffar Khan Zubin Khan Correction of error Zaffar Khan incorrectly credited (1) Equipment Office expenses Correction of error equipment debited to office expenses (1) Stationery Purchases Correction of error stationery debited to purchases account (1) Sales returns Mariam Sitar Correction of error no entry made for sales returns (1)
170 (1)
1000 (1)
19 (1)
25 (1)
170 (1)
1000 (1)
19 (1)
25 (1)
[12] (c) Error 2 Effect – Increase (1) Reason – Expenses are being reduced so the profit increases. (2) Error 3 Effect – No effect (1) Reason – The cost of sales is being reduced, but the expenses are being
increased. The profit does not alter. (2) Error 4 Effect – Decrease (1) Reason – The sales are being decreased so the profit will also decrease. (2) [9]
[Total: 23]
Prepared by D. El-Hoss
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Page 5 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2010 0452 23
© UCLES 2010
4 (a) Balance 1 April 2009 Explanation – This is the amount of rates (property tax) prepaid during the previous
financial year which related to the current financial year. (2) Double entry – credit rates (property tax) account for year ended 31 March 2009. (1) Bank 1 July 2010 Explanation – This is the total amount of rates (property tax) paid by cheque. (2) Double entry – credit bank column in cash book. (1) Income statement (profit and loss) 31 March 2010 Explanation – This is the rates (property tax) relating to the current financial year
transferred to the income statement (profit and loss). (2) Double entry – debit income statement (profit and loss). (1)
[9] (b) The balance represents the amount of rates (property tax) still outstanding for the financial
year ended 31 March 2010. [2] (c) (i) The accruals (matching) principle requires the revenue of the accounting period to be
matched against the costs of the same period. (2) (ii) The total rates relating to the financial year ended 31 March 2010 were transferred to the
income statement. (2) [4] (d) Business entity [1] (e) Realisation [1]
[Total: 17]
Prepared by D. El-Hoss
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Page 6 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2010 0452 23
© UCLES 2010
5 (a) Accountant – service business (1) Baker – trading business (1) Travel agent – service business (1) [3] (b) Calculation of fees $ Cheques received during the year 21 250 (1) Add amounts owing 30 April 2010 1 820 (1) 23 070 Less amounts owing 1 May 2009 1 770 (1) Fees for the year 21 300 (1) Calculation in ledger account format acceptable [4] (c) Martha Musa Income Statement (Profit and Loss Account) for the year ended 30 April 2010 $ $ Fees 21 300 (1)OF Rent received (2750 – 150) 2 600 (2) 23 900 Rates (property tax) and insurance 1 660 (1) General expenses (7710 + 230) 7 940 (2) Loss on disposal (6000 – 4000 – 1800) 200 (2) Depreciation – office equipment (25% × 8000 × 6 months) 1 000 (2) 10 800 Profit for the year (net profit) 13 100 (1)OF Horizontal format acceptable [11]
[Total: 18]
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Page 7 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2010 0452 23
© UCLES 2010
6 (a) (i) (2)(1)
29.63%1
100
000 54
000) 38 - 000 (54=×
(ii) (2)(1)
12.96%1
100
000 54
000) 9 - 000 (16=× [6]
(b) All comments and reasons to be based on OFs from (a) Gross profit percentage has fallen from 35.50% to 29.63%. Is earning $29.63 per $100 sales compared to $35.50 previously. The business is less profitable in respect of gross profit. Or other suitable comment Any 1 comment (2) Reduction in selling prices. Increase in cost of supplies. Change in proportions of different goods. Not passing on increased costs to customers. Or other acceptable reason Any 1 reason (2) Net profit percentage has increased from 10.45% to 12.96%. Is earning $12.96 per $100 sales compared to $10.45 previously. The business is more profitable. Or other suitable comment Any 1 comment (2) Increased control of expenses. Change in types of expenses. Or other acceptable reason Any 1 reason (2) [8] (c) Cannot meet liabilities when they are due. May experience difficulties in obtaining further supplies on credit. Cannot take advantage of cash discounts. Cannot take advantage of business opportunities as they arise. Any 2 points (2) each [4]
[Total: 18]
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
www.igcseaccounts.com
UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2011 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/11 Paper 1, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2011 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
Prepared by D. El-Hoss
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Page 2 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2011 0452 11
© University of Cambridge International Examinations 2011
1 Key (a) A [1] (b) B [1] (c) D [1] (d) B [1] (e) C [1] (f) A [1] (g) B [1] (h) C [1] (i) D [1] (j) B [1]
[Total: 10]
2 (a) Cash book, petty cash book, sales day book (journal), sales returns day book (journal),
purchases day book (journal), purchases returns day book (journal), journal. (Any two, 1 mark each). [2] (b) To calculate the [net] profit [or loss] [for the year] – not gross profit. [1] (c)
Income Expense
Carriage outwards �(1)
Bad debt recovered �(1)
Discount received �(1)
[3] (d) The petty cashier has a fixed amount of money (the imprest) (1) and is reimbursed the
amount of the actual expenses each period (1) to maintain this amount. [2]
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© University of Cambridge International Examinations 2011
(e) (i) Consistency [1] (ii) Reliability [1] (f) Current assets (1) less Current liabilities (1) [2] (g) (i) Working capital = Trade receivables + bank + inventory – trade payables = (1300 + 3500 + 2900) (7700) (1) – 1800 (1) = 5900 (1)OF [3] (ii) Quick ratio = current assets less inventory / current liabilities = (7700 – 2900) (4800) (1) / 1800 (1) = 2.67 : 1 (1)OF (accept 2.66 : 1) [3] (h) Ordinary shares (equity shares), preference shares. [2]
[Total: 20]
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Page 4 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2011 0452 11
© University of Cambridge International Examinations 2011
3 (a) Alcazar – credit sales $ Bank deposits 15 270 (1) Less cash sales 2 680 (1) 12 590 Add trade receivables at 31 March 2011 4 080 Less trade receivables at 1 April 2010 3 140 940 (1) 13 530 (1)OF [4] (b)
Alcazar Income Statement for the year ended 31 March 2011
$ $ Revenue – credit sales 13 530 (1)OF – cash sales 2 680 (1) 16 210 Less Cost of sales Inventory at 1 April 2010 1 780 (1) Purchases 9 560 (1) Carriage inwards 280 (1) 11 620 Inventory at 31 March 2011 1 920 (1) 9 700 Gross profit (must be correct caption) 6 510 (1)OF Rent 600 (1) Electricity 360 (1) Insurance 580 (1) Wages 1 370 (1) 2 910 [Net] Profit [for the year] (must have caption) 3 600 (1)OF [12] (c) (i) Gross profit / sales = 6510 (1)OF / 16210 (1)OF = 40.16% (1)OF [3] (ii) Net profit / sales = 3600 (1)OF / 16210 (1)OF = 22.21% (1)OF [3] (d) (i) New gross profit / new sales = 9010 (1)OF / 18710 (1)OF = 48.16% (1)OF [3] (ii) Increased (1)OF [1] [Total: 26]
Prepared by D. El-Hoss
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Page 5 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2011 0452 11
© University of Cambridge International Examinations 2011
4 (a) An other payable (accrued expense) is an amount due and payable [in respect of expenses incurred in an accounting period] (1) which remains unpaid at the end of that period (1). [2]
(b)
Khalim Fuel expenses account
2011 30 April Bank 340 (1) Balance c/d 50 (1) 390
2010 1 May Balance b/d 30 (1) 2011 30 April Income statement 360 (1)OF (accept profit/loss acc) 000 390 1 May Balance b/d 50 (1)
(+ 1 for all correct dates) [6] (c)
Non-current tangible
Non-current intangible
Current
Warehouse �(1)
Goodwill �(1)
Motor van �(1)
Trade receivables �(1)
[4] (d) At the lower (1) of cost (1) and net realisable value (1) [3] (e)
Chair type Units in stock Cost or net realisable value
per unit $
Total value
$
Armchair 15 (1) 55 (1) 825
Dining chair 36 (1) 20 (2) 720
Folding chair 60 (1) 15 (1) 900
2 445 (1)
[8]
[Total: 23]
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Page 6 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2011 0452 11
© University of Cambridge International Examinations 2011
5 (a) Straight line method, revaluation method (1 mark each) [2] (b) Depreciation
(i) Year 1 4500 (1) @ 40% (1) = 1800 (1)OF
(ii) Year 2 (4500 – 1800) = 2700 (2)OF @ 40% = 1080 (1)OF
(iii) Year 3 (2700 – 1080) = 1620 (2)OF @ 40% = 648 (1)OF [9]
(c)
Piranha Limited Balance Sheet at end of third year (extract)
Cost
$
Provision for Depreciation
$
Net book value
$ Non-current assets
Computer system 4500 (1) 3528 (1)OF 972 (1)OF
[3] (d) Depreciation rate should have been higher (1) because net book value after three years
($972) is greater than expected scrap value after three years ($750) (1) [2] (e)
Increase Decrease No effect
Net profit �(2)
Working capital �(2)
Return on capital employed �(2)
[6]
[Total: 22]
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Page 7 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2011 0452 11
© University of Cambridge International Examinations 2011
6 (a) Error 1
Dr Cr
Suspense 180 (1)
[Carlo] – [loan] 180 (1)
Error 2
Cash [book] 850 (1)
Sales 850 (1)
Error 3
Purchases 900 (1)
Suspense 900 (1)
Error 4
Fixtures and fittings 1200 (1)
Repairs 1200 (1)
[8] (b)
Monica Suspense account
[Difference on] trial balance (1)Carlo – loan account (1)
720 (1) 180 (1) 900
Purchases (1)
900 (1) 000 900
[6]
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© University of Cambridge International Examinations 2011
(c) Monica
Statement of corrected profit for the year ended 28 February 2011
Draft profit 3600 (1) Error 1: no effect Error 2: add: sales 850 (1) Error 3: less: purchases (900) (1) Error 4: add: repairs 1200 (1) Corrected profit 4750 (1)OF
[5]
[Total: 19]
Prepared by D. El-Hoss
All Questions Copyright of Cambridge International Examinations
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2011 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/12 Paper 1, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2011 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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Page 2 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2011 0452 12
© University of Cambridge International Examinations 2011
1 Key (a) A [1] (b) B [1] (c) D [1] (d) B [1] (e) C [1] (f) A [1] (g) B [1] (h) C [1] (i) D [1] (j) B [1]
[Total: 10]
2 (a) Cash book, petty cash book, sales day book (journal), sales returns day book (journal),
purchases day book (journal), purchases returns day book (journal), journal. (Any two, 1 mark each). [2] (b) To calculate the [net] profit [or loss] [for the year] – not gross profit. [1] (c)
Income Expense
Carriage outwards �(1)
Bad debt recovered �(1)
Discount received �(1)
[3] (d) The petty cashier has a fixed amount of money (the imprest) (1) and is reimbursed the
amount of the actual expenses each period (1) to maintain this amount. [2]
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© University of Cambridge International Examinations 2011
(e) (i) Consistency [1] (ii) Reliability [1] (f) Current assets (1) less Current liabilities (1) [2] (g) (i) Working capital = Trade receivables + bank + inventory – trade payables = (1300 + 3500 + 2900) (7700) (1) – 1800 (1) = 5900 (1)OF [3] (ii) Quick ratio = current assets less inventory / current liabilities = (7700 – 2900) (4800) (1) / 1800 (1) = 2.67 : 1 (1)OF (accept 2.66 : 1) [3] (h) Ordinary shares (equity shares), preference shares. [2]
[Total: 20]
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Page 4 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2011 0452 12
© University of Cambridge International Examinations 2011
3 (a) Alcazar – credit sales $ Bank deposits 15 270 (1) Less cash sales 2 680 (1) 12 590 Add trade receivables at 31 March 2011 4 080 Less trade receivables at 1 April 2010 3 140 940 (1) 13 530 (1)OF [4] (b)
Alcazar Income Statement for the year ended 31 March 2011
$ $ Revenue – credit sales 13 530 (1)OF – cash sales 2 680 (1) 16 210 Less Cost of sales Inventory at 1 April 2010 1 780 (1) Purchases 9 560 (1) Carriage inwards 280 (1) 11 620 Inventory at 31 March 2011 1 920 (1) 9 700 Gross profit (must be correct caption) 6 510 (1)OF Rent 600 (1) Electricity 360 (1) Insurance 580 (1) Wages 1 370 (1) 2 910 [Net] Profit [for the year] (must have caption) 3 600 (1)OF [12] (c) (i) Gross profit / sales = 6510 (1)OF / 16210 (1)OF = 40.16% (1)OF [3] (ii) Net profit / sales = 3600 (1)OF / 16210 (1)OF = 22.21% (1)OF [3] (d) (i) New gross profit / new sales = 9010 (1)OF / 18710 (1)OF = 48.16% (1)OF [3] (ii) Increased (1)OF [1] [Total: 26]
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Page 5 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2011 0452 12
© University of Cambridge International Examinations 2011
4 (a) An other payable (accrued expense) is an amount due and payable [in respect of expenses incurred in an accounting period] (1) which remains unpaid at the end of that period (1). [2]
(b)
Khalim Fuel expenses account
2011 30 April Bank 340 (1) Balance c/d 50 (1) 390
2010 1 May Balance b/d 30 (1) 2011 30 April Income statement 360 (1)OF (accept profit/loss acc) 000 390 1 May Balance b/d 50 (1)
(+ 1 for all correct dates) [6] (c)
Non-current tangible
Non-current intangible
Current
Warehouse �(1)
Goodwill �(1)
Motor van �(1)
Trade receivables �(1)
[4] (d) At the lower (1) of cost (1) and net realisable value (1) [3] (e)
Chair type Units in stock Cost or net realisable value
per unit $
Total value
$
Armchair 15 (1) 55 (1) 825
Dining chair 36 (1) 20 (2) 720
Folding chair 60 (1) 15 (1) 900
2 445 (1)
[8]
[Total: 23]
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Page 6 Mark Scheme: Teachers’ version Syllabus Paper
IGCSE – May/June 2011 0452 12
© University of Cambridge International Examinations 2011
5 (a) Straight line method, revaluation method (1 mark each) [2] (b) Depreciation
(i) Year 1 4500 (1) @ 40% (1) = 1800 (1)OF
(ii) Year 2 (4500 – 1800) = 2700 (2)OF @ 40% = 1080 (1)OF
(iii) Year 3 (2700 – 1080) = 1620 (2)OF @ 40% = 648 (1)OF [9]
(c)
Piranha Limited Balance Sheet at end of third year (extract)
Cost
$
Provision for Depreciation
$
Net book value
$ Non-current assets
Computer system 4500 (1) 3528 (1)OF 972 (1)OF
[3] (d) Depreciation rate should have been higher (1) because net book value after three years
($972) is greater than expected scrap value after three years ($750) (1) [2] (e)
Increase Decrease No effect
Net profit �(2)
Working capital �(2)
Return on capital employed �(2)
[6]
[Total: 22]
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6 (a) Error 1
Dr Cr
Suspense 180 (1)
[Carlo] – [loan] 180 (1)
Error 2
Cash [book] 850 (1)
Sales 850 (1)
Error 3
Purchases 900 (1)
Suspense 900 (1)
Error 4
Fixtures and fittings 1200 (1)
Repairs 1200 (1)
[8] (b)
Monica Suspense account
[Difference on] trial balance (1)Carlo – loan account (1)
720 (1) 180 (1) 900
Purchases (1)
900 (1) 000 900
[6]
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(c) Monica
Statement of corrected profit for the year ended 28 February 2011
Draft profit 3600 (1) Error 1: no effect Error 2: add: sales 850 (1) Error 3: less: purchases (900) (1) Error 4: add: repairs 1200 (1) Corrected profit 4750 (1)OF
[5]
[Total: 19]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2011 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/13 Paper 1, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2011 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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1 Key (a) A [1] (b) B [1] (c) D [1] (d) B [1] (e) C [1] (f) A [1] (g) B [1] (h) C [1] (i) D [1] (j) B [1]
[Total: 10]
2 (a) Cash book, petty cash book, sales day book (journal), sales returns day book (journal),
purchases day book (journal), purchases returns day book (journal), journal. (Any two, 1 mark each). [2] (b) To calculate the [net] profit [or loss] [for the year] – not gross profit. [1] (c)
Income Expense
Carriage outwards �(1)
Bad debt recovered �(1)
Discount received �(1)
[3] (d) The petty cashier has a fixed amount of money (the imprest) (1) and is reimbursed the
amount of the actual expenses each period (1) to maintain this amount. [2]
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(e) (i) Consistency [1] (ii) Reliability [1] (f) Current assets (1) less Current liabilities (1) [2] (g) (i) Working capital = Trade receivables + bank + inventory – trade payables = (1300 + 3500 + 2900) (7700) (1) – 1800 (1) = 5900 (1)OF [3] (ii) Quick ratio = current assets less inventory / current liabilities = (7700 – 2900) (4800) (1) / 1800 (1) = 2.67 : 1 (1)OF (accept 2.66 : 1) [3] (h) Ordinary shares (equity shares), preference shares. [2]
[Total: 20]
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3 (a) Alcazar – credit sales $ Bank deposits 15 270 (1) Less cash sales 2 680 (1) 12 590 Add trade receivables at 31 March 2011 4 080 Less trade receivables at 1 April 2010 3 140 940 (1) 13 530 (1)OF [4] (b)
Alcazar Income Statement for the year ended 31 March 2011
$ $ Revenue – credit sales 13 530 (1)OF – cash sales 2 680 (1) 16 210 Less Cost of sales Inventory at 1 April 2010 1 780 (1) Purchases 9 560 (1) Carriage inwards 280 (1) 11 620 Inventory at 31 March 2011 1 920 (1) 9 700 Gross profit (must be correct caption) 6 510 (1)OF Rent 600 (1) Electricity 360 (1) Insurance 580 (1) Wages 1 370 (1) 2 910 [Net] Profit [for the year] (must have caption) 3 600 (1)OF [12] (c) (i) Gross profit / sales = 6510 (1)OF / 16210 (1)OF = 40.16% (1)OF [3] (ii) Net profit / sales = 3600 (1)OF / 16210 (1)OF = 22.21% (1)OF [3] (d) (i) New gross profit / new sales = 9010 (1)OF / 18710 (1)OF = 48.16% (1)OF [3] (ii) Increased (1)OF [1] [Total: 26]
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4 (a) An other payable (accrued expense) is an amount due and payable [in respect of expenses incurred in an accounting period] (1) which remains unpaid at the end of that period (1). [2]
(b)
Khalim Fuel expenses account
2011 30 April Bank 340 (1) Balance c/d 50 (1) 390
2010 1 May Balance b/d 30 (1) 2011 30 April Income statement 360 (1)OF (accept profit/loss acc) 000 390 1 May Balance b/d 50 (1)
(+ 1 for all correct dates) [6] (c)
Non-current tangible
Non-current intangible
Current
Warehouse �(1)
Goodwill �(1)
Motor van �(1)
Trade receivables �(1)
[4] (d) At the lower (1) of cost (1) and net realisable value (1) [3] (e)
Chair type Units in stock Cost or net realisable value
per unit $
Total value
$
Armchair 15 (1) 55 (1) 825
Dining chair 36 (1) 20 (2) 720
Folding chair 60 (1) 15 (1) 900
2 445 (1)
[8]
[Total: 23]
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5 (a) Straight line method, revaluation method (1 mark each) [2] (b) Depreciation
(i) Year 1 4500 (1) @ 40% (1) = 1800 (1)OF
(ii) Year 2 (4500 – 1800) = 2700 (2)OF @ 40% = 1080 (1)OF
(iii) Year 3 (2700 – 1080) = 1620 (2)OF @ 40% = 648 (1)OF [9]
(c)
Piranha Limited Balance Sheet at end of third year (extract)
Cost
$
Provision for Depreciation
$
Net book value
$ Non-current assets
Computer system 4500 (1) 3528 (1)OF 972 (1)OF
[3] (d) Depreciation rate should have been higher (1) because net book value after three years
($972) is greater than expected scrap value after three years ($750) (1) [2] (e)
Increase Decrease No effect
Net profit �(2)
Working capital �(2)
Return on capital employed �(2)
[6]
[Total: 22]
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6 (a) Error 1
Dr Cr
Suspense 180 (1)
[Carlo] – [loan] 180 (1)
Error 2
Cash [book] 850 (1)
Sales 850 (1)
Error 3
Purchases 900 (1)
Suspense 900 (1)
Error 4
Fixtures and fittings 1200 (1)
Repairs 1200 (1)
[8] (b)
Monica Suspense account
[Difference on] trial balance (1)Carlo – loan account (1)
720 (1) 180 (1) 900
Purchases (1)
900 (1) 000 900
[6]
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(c) Monica
Statement of corrected profit for the year ended 28 February 2011
Draft profit 3600 (1) Error 1: no effect Error 2: add: sales 850 (1) Error 3: less: purchases (900) (1) Error 4: add: repairs 1200 (1) Corrected profit 4750 (1)OF
[5]
[Total: 19]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2011 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/21 Paper 2, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2011 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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© University of Cambridge International Examinations 2011
1 (a) To notify the customer of the amount outstanding at the end of the month. To provide the customer with a summary of the month’s transactions. Any 1 reason (1) [1] (b) Fiona Fraser [1] (c)
Journal Debit $
Credit $
Interest payable Fiona Fraser Interest charged by creditor on overdue account
2
2
(1)(1) (1)
[3] (d)
Account debited Account credited
(i) (ii)
Purchases (1) Fiona Fraser (1)
Fiona Fraser (1) Purchases returns (1)
[4] (e) (i) Cash book (1) (ii) Sales journal (1) (iii) Sales returns journal (1) [3] (f) Goods returned Allowance for damaged/faulty goods Correction of overcharge Any one reason (1) [1] (g) (i) $225.40 (1) (ii) The amount was paid within the period of credit allowed (1) [2] [Total: 15]
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2 (a) Paul Muyambo Statement of Affairs 31 January 2011
$ $ $ Non-current Assets Machinery at book value 32 500 Less Depreciation for the year 8 125 (1) 24 375 (1) Motor vehicle at valuation 10 300 Less Depreciation for the year 1 200 9 100 (1) 33 475 Current Assets Inventory 12 648 (1) Trade receivables 11 320 Less Provision for doubtful debts 283 (1) 11 037 (1) Other receivables 261 (1) 23 946 Current Liabilities Trade payables 9 485 (1) Other payables 315 (1) Bank overdraft 11 146 (1) 20 946 Net current assets 3 000 (1) O/F 36 475 Financed by Capital Balance 36 475 (2) C/F (1) O/F Horizontal format acceptable [13]
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(b) Calculation of profit or loss for the year ended 31 January 2011
$ $ Capital at 31 January 2011 36 475 (1) O/F Drawings cash 5 575 (1) Drawings goods 1 700 (1) 7 275 43 750 Less Capital 1 February 2010 42 500 (1) Capital introduced 3 000 (1) 45 500 Loss for the year 1 750 (2) O/F Alternative presentation
Capital account
$ $ 2011 2010 Jan 31 Drawings cash 5 575 (1) Feb 1 Balance b/d 42 500 (1) Drawings goods 1 700 (1) 2011 Loss for year 1 750 (2) Jan 31 Bank/cash 3 000 (1) O/F Balance c/d 36 475 (1) _____ O/F ______ 45 500 45 500 2011 Feb 1 Balance b/d 36 475 Three column running balance presentation acceptable [7] [Total: 20]
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3 (a) Drawings and interest on drawings exceeded the interest on capital and share of profit. [2] (b) Current accounts Omar Fatima Omar Fatima $ $ $ $ 2010 2010 Apl 1 Balance b/d (1) 215 Apl 1 Balance b/d (1) 1 945 2011 2011 Mar 31 Drawings (1) 2 900 9 600 Mar 31 Interest on Interest on capital (1) 2 400 1 600 Drawings (1) 87 288 Salary (1) 12 000 Share of loss (1) 1 230 820 Balance c/d (1) 2 032 Balance c/d (1) ____ 4 837 15 545 4 432 15 545 4 432 15 545 2011 2011 Apl 1 Balance (1) 2 032 Apl 1 Balance b/d (1) 4 837 O/F O/F
Alternatively accept two separate “T” accounts Alternative presentation
Omar Aziz Current account
Debit Credit Balance 2010 $ $ $ April 1 Balance 215 (1) 215 Dr 2011 Mar 31 Interest on capital 2 400 2 185 Cr Drawings 2 900 715 Dr Interest on drawings 87 802 Dr Share of loss 1 230 2 032 Dr (2) C/F (1) O/F
Fatima Aziz current account
Debit Credit Balance 2010 $ $ $ April 1 Balance 1 945 (1) 1 945 Cr 2011 Mar 31 Interest on capital 1 600 3 545 Cr Salary 12 000 (1) 15 545 Cr Drawings 9 600 5 945 Cr Interest on drawings 288 5 657 Cr Share of loss 820 4 837 Cr
(2) C/F (1) O/F Need correct entries for interest on capital, interest on drawings, drawings and share
of loss to earn the (1) for these items [11]
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(c) Aziz Stores
Extract from Balance Sheet at 31 March 2011
Omar Aziz Fatima Aziz Total $ $ $ Capital accounts 60 000 (1) 40 000 (1) 100 000 Current accounts (2 032) (1) O/F 4 837 (1) O/F 2 805 57 968 44 837 102 805 (1) O/F [5] (d) Easier to see the profit retained by each partner Easier to calculate the interest on capital Or other suitable point Any one point (2) [2] (e) The members of a limited liability company have limited liability and their personal assets are
not at risk is the business fails. [2] [Total: 22]
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4 (a) (i) Income and expenditure account (1) (ii) Surplus (or excess of income over expenditure) (1) (iii) Accumulated fund (1) [3] (b) Muara Swimming Club Receipts and Payments Account for the year ended 28 February 2011
$ $ 2010 2011 Mar 1 Balance b/d 3 450 (1) Feb 28 Equipment 1 200 (1) 2011 Rent 2011 1 690 (1) Feb 28 Subscriptions 2010 270} Competition 2011 5 400} (1) expenses 645 (1) 2012 180} General Equipment proceeds 890 (1) expenses 732 (1) Competition receipts 780 (1) Insurance 496 (1) Loan – Swim-for-all 1 000 (1) Balance c/d 7 207 (1) 11 970 11 970 2011 Mar 1 Balance b/d 7 207 (1) O/F [12] (c) Subscriptions account $ $ 2010 2011 Mar 1 Balance b/d 270 (1) Feb 28 Bank 270 (1) 2011 Bank 5400 (1) Feb 28 Income and Bank 180 (1) expenditure (1) 5400 (1) Balance c/d 180 (1) ____ 5850 5850 2011 Mar 1 Balance b/d 180 (1) [8] Alternative presentation Subscriptions account
Debit Credit Balance 2010 $ $ $ Mar 1 Balance 270 (1) 270 Dr 2011 Feb 28 Bank 270 (1) 0 Bank 5400 (1) 5400 Cr Bank 180 (1) 5580 Cr Income and expenditure (1) 5400 (1) 180 Cr (2) [8] [Total: 23]
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5 (a) (i) Balance 1 November 2009 Explanation – This is the amount of rent owing by the tenant for the financial year
ended 31 October 2009 (2) Double entry – Credit rent receivable account for the year ended 31 October 2009 (1) [3] (ii) Bank 2 November 2009 Explanation – This is the total amount of rent received from the tenant by cheque,
including $100 for the previous year (2) Double entry – Debit bank column in cash book (1) [3] (iii) Income statement 31 October 2010 Explanation – This is the rent receivable relating to the current financial year
transferred to the income statement (2) Double entry – Credit income statement (1) [3] (b) The balance represents the amount of rent prepaid by the tenant for the following financial
year. [2] (c) (i) Capital expenditure is money spent on acquiring, improving and installing fixed assets. (1) Revenue expenditure is money spent on running a business on a day-to-day basis. (1) [2] (ii) Capital receipts are amounts received which do not form part of the day-to-day trading
activities. (1) Revenue receipts are amounts received in the day-to-day trading activities from revenue
and other items of income. (1) [2]
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(d) Leo Yang Statement of corrected profit for the six months ended 30 April 2011
$ $ Profit 7 900 Add Purchase of new equipment 16 800 (1) Rent received 1 200 (1) 18 000 25 900 Less Sale of old equipment 9 200 (1) Loan from Sports-aid 10 000 (1) Purchase of stationery 110 (1) Loan interest paid 200 (1) 19 510 Corrected net profit 6 390 (1) Alternative presentation Leo Yang
Income Statement for the six months ended 30 April 2011
$ $ Fees 14 000 Add Rent received 1 200 (1) 15 200 Less General expenses 8 500 Stationery 110 (1) Loan interest 200 (1) 8 810 Profit for the six months 6 390 (1) + (1) for omission of sale of equipment + (1) for omission of purchase of equipment + (1) for omission of loan [7] [Total: 22]
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6 (a) 1
365
42500
5300× (1) = 45.52 = 46 days (1) [2]
(b) Unsatisfied if O/F in (a) is over 30 days (1) They are not receiving the amount due within the period of credit allowed (2) Or Satisfied if O/F in (a) is 30 days or below (1) They are receiving the amount due within the period of credit allowed (2) [3]
(c) 1
365
52800
4100× (1) = 28.34 = 29 days (1) [2]
(d) Disadvantage if O/F in (c) is over 24 days (1) She is receiving the amount due 5 (O/F) days later than in the previous year (2) Or Advantage if O/F in (c) is 24 days or below (1) She is receiving the amount due x (O/F) days earlier than in the previous year (2) [3] (e) Offer cash discount for prompt payment Charge interest on overdue accounts Improve credit control Refuse further supplies on credit until outstanding balance paid Invoice discounting and debt factoring Or other relevant points Any two points (1) each [2] (f) (4100 + 3800) : (5300 + 2900) (1) = 0.96 : 1 (1) [2] (g) Unsatisfied if O/F in (f) is less than 2:1 (1) She is unable to meet her immediate liabilities from her immediate assets (1) Or Satisfied if O/F in (f) is 2:1 or over (1) She is able to meet her immediate liabilities from her immediate assets (1) [2] (h) Introduce additional capital Reduce drawings Obtain long term loan Sell surplus non-current assets Any two points (1) each [2] [Total: 18]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2011 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/22 Paper 2, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2011 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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© University of Cambridge International Examinations 2011
1 (a) Paul Ahmadi account $ $ 2011 2011 April 1 Balance b/d 240 April 7 Bank 234 (1) 11 Sales 368 (1) Discount 6 (1) 18 Sales returns 136 (1) ___ 30 Balance c/d 232 (1) 608 608 May 1 Balance b/d 232 (1) O/F [6] Irene Moyo account $ $ 2011 2011 April 1 Balance b/d 110 April 24 Bank 80 (1) 2 Interest 4 (1) 30 Bad debts 34 (1) 114 114 [3] Alternative presentation
Paul Ahmadi account
Debit Credit Balance 2010 $ $ $ April 1 Balance 240 240 Dr 7 Bank 234 (1) 6 Dr Discount 6 (1) – 11 Sales 368 (1) 368 Dr 18 Sales returns 136 (1) 232 (2) C/F (1) O/F [6]
Irene Moyo account
Debit Credit Balance 2010 $ $ $ April 1 Balance 110 110 Dr 2 Interest 4 (1) 114 Dr 24 Bank 80 (1) 34 Dr 30 Bad debts 34 (1) – [3] (b) A debit note may be issued by a customer to request a reduction in an invoice (1) A credit note may be issued by a supplier to reduce an invoice for returns/overcharge etc (1) [2] (c) (i) purchases journal (1) (ii) sales returns journal (1) [2]
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© University of Cambridge International Examinations 2011
(d) A statement of account is not a transaction (1) It is a summary of the account of the customer in the books of the supplier Or It is a reminder to the customer of the amount due (1) [2]
(e)
Item Source of information Entry in sales ledger control account
(ii) (iii) (iv)
bad debts written off cash discount allowed contra item transferred to purchases ledger
journal (1) cash book (1) journal (1)
credit (1) credit (1) credit (1)
[6] [Total: 21] 2
Sabena Khan Income Statement for the year ended 31 January 2011
$ $ $ Revenue 58 200 (1) Less Cost of sales Opening inventory 7 500 (1) Purchases 51 400 (1) Less purchases returns 2 300 (1) 49 100 56 600 Less Closing inventory 10 040 (2) C/F 46 560 (1) O/F Gross profit 11 640 (2) Bad debts recovered 150 (1) Provision for doubtful debts (116 – 98) 18 (2) 11 808 Bad debts 50 (1) Carriage outwards 700 (1) Administration expenses 7 960 (1) Discount allowed 182 (1) Depreciation – Equipment (4500 – 3800) 700 (1) Fixtures and fittings 10% × 5400 540 (1) 10 132 Profit for the year 1 676 (1) O/F Horizontal format acceptable [Total: 18]
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© University of Cambridge International Examinations 2011
3 (a) Business entity [1] (b)
Journal Debit $
Credit $
1
W Lister Current (or Drawings) Purchases Goods taken for own use by W Lister
420 420
(1) (1) (1)
2 Office stationery T Lister Current Office stationery paid for by T Lister
32 32
(1) (1) (1)
3 Motor vehicles W Lister Capital Motor vehicle introduced by W Lister
15 200 15 200
(1) (1) (1)
4 T Lister Current T Lister Capital Transfer from current to capital account
5 000 5 000
(1) (1) (1)
[12] (c) Lower of cost and net realisable value [1] (d) To avoid overstating the profit To avoid overstating the assets To apply the principle of prudence Any two comments (1 each) [2] (e) $560 (1) × ¾ (1) = $420 (1) Decrease (1) Or $ Original profit share ¾ × $18 500 13 875 (1) New profit share ¾ × $17 940 13 455 (1) Reduction (1) in profit share 420 (1) Other methods of calculation acceptable [4] [Total: 20]
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4 (a) Consistency [1] (b) Ensures that profits are not overstated (1) Ensures that the non-current assets are not overstated (1) [2] (c) Accruals (Or matching) [1] (d) Office equipment account $ $ 2010 2010 April 1 Balance b/d 7 500 (1) Dec 31 Disposals 4 000 (1) Oct 1 Bank 3 500 (1) 2011 ______ Mar 31 Balance c/d 7 000 (1) 11 000 11 000 2011 April 1 Balance b/d 7 000 (1) O/F [5]
Provision for depreciation of office equipment account
$ $ 2010 2010 Dec 31 Disposals 1 600 (2) April 1 Balance b/d 4 500 (1) 2011 2011 Mar 31 Balance c/d 3 950 (1) Mar 31 Income statement 20% × (7500 – 4000) 700 (1) Income statement _____ 20% × 3500 × 6/12 350 (1) 5 550 5 550 2011 April 1 Balance b/d 3 950 (1) O/F [7]
Office equipment disposal account
$ $ 2010 2010 Dec 31 Office equipment 4 000 (1) Dec 31 Prov for Dep 1 600 (1) O/F O/F AH Company 2 000 (1) 2011 Mar 31 Income statement 400 (1) _____ O/F 4 000 4 000 [4]
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Alternative presentation
Office equipment account
Debit Credit Balance 2010 $ $ $ April 1 Balance 7 500 (1) 7 500 Dr Oct 1 Bank 3 500 (1) 11 000 Dr Dec 31 Disposals 4 000 (1) 7 000 Dr (2) C/F (1) O/F [5]
Depreciation of office equipment account
Debit Credit Balance 2010 $ $ $ April 1 Balance 4 500 (1) 4 500 Cr Dec 31 Disposals 1 600 (2) 2 900 Cr 2011 Mar 31 Income statement 20% × (7500 – 4000) 700 (1) 20% × 3500 v 6/12 350 (1) 3 950 Cr (2) C/F (1) O/F [7]
Office equipment disposal account
Debit Credit Balance 2010 $ $ $ Dec 31 Office equipment 4 000 (1)O/F 4 000 Dr Prov for Dep 1 600 (1)O/F 2 400 Dr AH Company 2 000 (1) 400 Dr 2011 Mar 31 Income statement 400 (1)O/F [4] [Total: 20]
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5 (a) Osama Mousa Statement of Affairs at 31 March 2011
$ $ $ Non-current Assets Cost Depreciation Book to date value Equipment 17 000 (1) 4 250 (1) 12 750 (1) Motor vehicle 10 000 2 500 (1) 7 500 (1) 27 000 6 750 20 250 Current Assets Trade receivables 5 700 (1) Petty cash 100 (1) 5 800 Current Liabilities Trade payables 1 750 (1) Other payables 550 (1) Bank overdraft 1 400 (1) 3 700 Net current assets 2 100 (1)O/F 22 350 Long term Liabilities Loan from Hi-Finance 1 250 (1) 21 100 Financed by Capital Balance 21 100 (2) C/F (1) O/F Horizontal presentation acceptable [14]
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(b) Calculation of profit or loss for the year ended 31 March 2011
$ $ Capital at 31 March 2011 21 100 (1) O/F Drawings 8 000 (1) 29 100 Less Capital at 1 April 2010 22 000 (1) Capital introduced 5 000 (1) 27 000 Profit for the year 2 100 (2) O/F Alternative presentation
Capital account
$ $ 2011 2010 Mar 31 Drawings 8 000 (1) April 1 Balance b/d 22 000 (1) Balance c/d 21 100 (1) 2011 Mar 31 Bank 5 000 (1) Profit for year 2 100 (2) _____ _____ O/F 29 100 29 100 2011 April 1 Balance b/d 21 100 Three column running balance account acceptable [6]
[Total: 20] 6 (a) Percentage of gross profit to sales Gross profit = 585 000 – (31 600 + 390 000 – 32 100) = 195 500 (1)
Gross profit percentage = 1
100
585000
195500×
(1) = 33.42% (1)
Percentage of net profit to sales Net profit = 195 500 (O/F) – (51 300 + 45 200) = 99 000 (1) O/F
Net profit percentage = 1
100
585000
99000×
OF (1) = 16.92% (1) O/F
Rate of inventory turnover Cost of goods sold = 31 600 + 390 000 – 32 100 = 389 500
Average stock = 2
3210031600 + = 31 850
Rate of turnover = (1)
(1)
31850
389500 = 12.23 times (1) [9]
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(b) (i) Salma Ali is – Not buying goods as cheaply Not taking advantage of bulk buying Not passing increased costs on to customers Buying more expensive goods Selling goods at a lower margin Allowing customers a higher rate of trade discount Or other suitable point Any one reason (2) (ii) Salma Ali has – Lower expenses Better control of expenses Different types of expenses (fixed/variable) Higher amount of other income Or other suitable point Any one reason (2) (iii) Salma Ali has – Higher stock levels Lower sales activity Or other suitable point Any one reason (2) [6] (c) Should compare with a business of approximately the same size Should compare with a business of the same type (sole trader) Should compare with business selling same type of goods Should compare with a business with approximately the same amount of capital The accounts may be for one year only which will not show trends and may not be a typical
year The financial year may end at a different point in the trading cycle The businesses may operate different accounting policies There may be differences which affect profitability and the items on a balance sheet The financial statements do not show non-monetary items It is not always possible to obtain all the information about a business in order to make a true
comparison Or other suitable points Any three points (2) each [6] [Total: 21]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2011 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/23 Paper 2, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2011 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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1 (a) Paul Ahmadi account $ $ 2011 2011 April 1 Balance b/d 240 April 7 Bank 234 (1) 11 Sales 368 (1) Discount 6 (1) 18 Sales returns 136 (1) ___ 30 Balance c/d 232 (1) 608 608 May 1 Balance b/d 232 (1) O/F [6] Irene Moyo account $ $ 2011 2011 April 1 Balance b/d 110 April 24 Bank 80 (1) 2 Interest 4 (1) 30 Bad debts 34 (1) 114 114 [3] Alternative presentation
Paul Ahmadi account
Debit Credit Balance 2010 $ $ $ April 1 Balance 240 240 Dr 7 Bank 234 (1) 6 Dr Discount 6 (1) – 11 Sales 368 (1) 368 Dr 18 Sales returns 136 (1) 232 (2) C/F (1) O/F [6]
Irene Moyo account
Debit Credit Balance 2010 $ $ $ April 1 Balance 110 110 Dr 2 Interest 4 (1) 114 Dr 24 Bank 80 (1) 34 Dr 30 Bad debts 34 (1) – [3] (b) A debit note may be issued by a customer to request a reduction in an invoice (1) A credit note may be issued by a supplier to reduce an invoice for returns/overcharge etc (1) [2] (c) (i) purchases journal (1) (ii) sales returns journal (1) [2]
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(d) A statement of account is not a transaction (1) It is a summary of the account of the customer in the books of the supplier Or It is a reminder to the customer of the amount due (1) [2]
(e)
Item Source of information Entry in sales ledger control account
(ii) (iii) (iv)
bad debts written off cash discount allowed contra item transferred to purchases ledger
journal (1) cash book (1) journal (1)
credit (1) credit (1) credit (1)
[6] [Total: 21] 2
Sabena Khan Income Statement for the year ended 31 January 2011
$ $ $ Revenue 58 200 (1) Less Cost of sales Opening inventory 7 500 (1) Purchases 51 400 (1) Less purchases returns 2 300 (1) 49 100 56 600 Less Closing inventory 10 040 (2) C/F 46 560 (1) O/F Gross profit 11 640 (2) Bad debts recovered 150 (1) Provision for doubtful debts (116 – 98) 18 (2) 11 808 Bad debts 50 (1) Carriage outwards 700 (1) Administration expenses 7 960 (1) Discount allowed 182 (1) Depreciation – Equipment (4500 – 3800) 700 (1) Fixtures and fittings 10% × 5400 540 (1) 10 132 Profit for the year 1 676 (1) O/F Horizontal format acceptable [Total: 18]
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3 (a) Business entity [1] (b)
Journal Debit $
Credit $
1
W Lister Current (or Drawings) Purchases Goods taken for own use by W Lister
420 420
(1) (1) (1)
2 Office stationery T Lister Current Office stationery paid for by T Lister
32 32
(1) (1) (1)
3 Motor vehicles W Lister Capital Motor vehicle introduced by W Lister
15 200 15 200
(1) (1) (1)
4 T Lister Current T Lister Capital Transfer from current to capital account
5 000 5 000
(1) (1) (1)
[12] (c) Lower of cost and net realisable value [1] (d) To avoid overstating the profit To avoid overstating the assets To apply the principle of prudence Any two comments (1 each) [2] (e) $560 (1) × ¾ (1) = $420 (1) Decrease (1) Or $ Original profit share ¾ × $18 500 13 875 (1) New profit share ¾ × $17 940 13 455 (1) Reduction (1) in profit share 420 (1) Other methods of calculation acceptable [4] [Total: 20]
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4 (a) Consistency [1] (b) Ensures that profits are not overstated (1) Ensures that the non-current assets are not overstated (1) [2] (c) Accruals (Or matching) [1] (d) Office equipment account $ $ 2010 2010 April 1 Balance b/d 7 500 (1) Dec 31 Disposals 4 000 (1) Oct 1 Bank 3 500 (1) 2011 ______ Mar 31 Balance c/d 7 000 (1) 11 000 11 000 2011 April 1 Balance b/d 7 000 (1) O/F [5]
Provision for depreciation of office equipment account
$ $ 2010 2010 Dec 31 Disposals 1 600 (2) April 1 Balance b/d 4 500 (1) 2011 2011 Mar 31 Balance c/d 3 950 (1) Mar 31 Income statement 20% × (7500 – 4000) 700 (1) Income statement _____ 20% × 3500 × 6/12 350 (1) 5 550 5 550 2011 April 1 Balance b/d 3 950 (1) O/F [7]
Office equipment disposal account
$ $ 2010 2010 Dec 31 Office equipment 4 000 (1) Dec 31 Prov for Dep 1 600 (1) O/F O/F AH Company 2 000 (1) 2011 Mar 31 Income statement 400 (1) _____ O/F 4 000 4 000 [4]
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Alternative presentation
Office equipment account
Debit Credit Balance 2010 $ $ $ April 1 Balance 7 500 (1) 7 500 Dr Oct 1 Bank 3 500 (1) 11 000 Dr Dec 31 Disposals 4 000 (1) 7 000 Dr (2) C/F (1) O/F [5]
Depreciation of office equipment account
Debit Credit Balance 2010 $ $ $ April 1 Balance 4 500 (1) 4 500 Cr Dec 31 Disposals 1 600 (2) 2 900 Cr 2011 Mar 31 Income statement 20% × (7500 – 4000) 700 (1) 20% × 3500 v 6/12 350 (1) 3 950 Cr (2) C/F (1) O/F [7]
Office equipment disposal account
Debit Credit Balance 2010 $ $ $ Dec 31 Office equipment 4 000 (1)O/F 4 000 Dr Prov for Dep 1 600 (1)O/F 2 400 Dr AH Company 2 000 (1) 400 Dr 2011 Mar 31 Income statement 400 (1)O/F [4] [Total: 20]
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5 (a) Osama Mousa Statement of Affairs at 31 March 2011
$ $ $ Non-current Assets Cost Depreciation Book to date value Equipment 17 000 (1) 4 250 (1) 12 750 (1) Motor vehicle 10 000 2 500 (1) 7 500 (1) 27 000 6 750 20 250 Current Assets Trade receivables 5 700 (1) Petty cash 100 (1) 5 800 Current Liabilities Trade payables 1 750 (1) Other payables 550 (1) Bank overdraft 1 400 (1) 3 700 Net current assets 2 100 (1)O/F 22 350 Long term Liabilities Loan from Hi-Finance 1 250 (1) 21 100 Financed by Capital Balance 21 100 (2) C/F (1) O/F Horizontal presentation acceptable [14]
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(b) Calculation of profit or loss for the year ended 31 March 2011
$ $ Capital at 31 March 2011 21 100 (1) O/F Drawings 8 000 (1) 29 100 Less Capital at 1 April 2010 22 000 (1) Capital introduced 5 000 (1) 27 000 Profit for the year 2 100 (2) O/F Alternative presentation
Capital account
$ $ 2011 2010 Mar 31 Drawings 8 000 (1) April 1 Balance b/d 22 000 (1) Balance c/d 21 100 (1) 2011 Mar 31 Bank 5 000 (1) Profit for year 2 100 (2) _____ _____ O/F 29 100 29 100 2011 April 1 Balance b/d 21 100 Three column running balance account acceptable [6]
[Total: 20] 6 (a) Percentage of gross profit to sales Gross profit = 585 000 – (31 600 + 390 000 – 32 100) = 195 500 (1)
Gross profit percentage = 1
100
585000
195500×
(1) = 33.42% (1)
Percentage of net profit to sales Net profit = 195 500 (O/F) – (51 300 + 45 200) = 99 000 (1) O/F
Net profit percentage = 1
100
585000
99000×
OF (1) = 16.92% (1) O/F
Rate of inventory turnover Cost of goods sold = 31 600 + 390 000 – 32 100 = 389 500
Average stock = 2
3210031600 + = 31 850
Rate of turnover = (1)
(1)
31850
389500 = 12.23 times (1) [9]
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(b) (i) Salma Ali is – Not buying goods as cheaply Not taking advantage of bulk buying Not passing increased costs on to customers Buying more expensive goods Selling goods at a lower margin Allowing customers a higher rate of trade discount Or other suitable point Any one reason (2) (ii) Salma Ali has – Lower expenses Better control of expenses Different types of expenses (fixed/variable) Higher amount of other income Or other suitable point Any one reason (2) (iii) Salma Ali has – Higher stock levels Lower sales activity Or other suitable point Any one reason (2) [6] (c) Should compare with a business of approximately the same size Should compare with a business of the same type (sole trader) Should compare with business selling same type of goods Should compare with a business with approximately the same amount of capital The accounts may be for one year only which will not show trends and may not be a typical
year The financial year may end at a different point in the trading cycle The businesses may operate different accounting policies There may be differences which affect profitability and the items on a balance sheet The financial statements do not show non-monetary items It is not always possible to obtain all the information about a business in order to make a true
comparison Or other suitable points Any three points (2) each [6] [Total: 21]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2012 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/11 Paper 1, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2012 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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1 Key (a) C [1] (b) D [1] (c) D [1] (d) A [1] (e) B [1] (f) B [1] (g) D [1] (h) C [1] (i) A [1] (j) A [1]
[Total: 10] 2 (a) Invoice [1] (b) To show the financial position of a business on a certain date. [1] (c)
Asset Liability
Inventory �(1)
Rent receivable prepaid �(1)
Trade payables �(1)
[3] (d) To calculate how much it has cost the business to manufacture the goods (1) produced in the
financial year (1). [2]
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(e) (i) Money measurement (1) (ii) Relevance (1) [2]
(f) (300 × $10.30) (1) = $3090 – 4% = $3090 – $123.60 = $2966.40 (1) [2] (g) Land, buildings, machinery, equipment, fixtures, motor vehicles, goodwill Any 2 (1) each [2] (h) The business is treated as being completely separate from the owner. (1) The accounting records relate only to the business, (1) [2]
(i) (200 × $100) (1) = $20 000 × 3% × ½ = $300 (1) [2] (j) Payments $2100 Less opening accrual 350 (1) 1750 Plus closing accrual 470 (1) Charge for the year 2220 (1) [3]
[Total: 20] 3 (a) To assist in the preparation of financial statements To check for arithmetical accuracy/errors (must include arithmetical) Any 1 reason (1) [1]
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(b) Hans Lee Trial Balance at 30 April 2012
Dr $
Cr $
Revenue 110 000
Purchases 65 000
Inventory (1 May 2011) 11 500 (1)
Trade receivables 1 300 }
Trade payables 1 900 }(1)
Machinery 7 400
Expenses 31 600
Bank overdraft 3 100 (1)
Capital 11 500 }
Drawings 7 600 }(1)
Suspense (1) 2 100 (1) OF
126 500 126 500 (1)
[7] (c) Hans Lee Journal
Debit $
Credit $
1 Purchases Suspense
1 600 1 600
(1) (1)
2 Suspense John Tan
300 300
(1) (1)
3 Drawings Suspense
200 200
(1) (1)
[6]
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(d)
Increase Decrease No effect
Error 1 �(1)
Error 2 �(1)
Error 3 �(1)
[3] (e) All the errors have NOT YET been discovered. (1) There is a balance remaining on the suspense account/Trial Balance. (1) [2]
[Total: 19] 4 (a) To avoid recording small cash payments in the main cash book (2) To reduce the number of entries in the main cash book (2) Any one reason (2) [2] (b) The petty cashier starts each month with the same amount of money. (1) At the end of the period the amount spent is reimbursed so the cash remaining is equal to
the imprest amount. (1) [2] (c) Refer to next page [12] (d) Postages and stationery account
2012 $ 2012 $ April 30 Petty cash 60 (1) April 30 Petty cash 4 (1) Motor expenses account 2012 $ April 30 Petty cash 38 (1) Catering supplies account 2012 $ April 30 Petty cash 12 (1) Cleaning account 2012 $ April 30 Petty cash 70 (1) [5]
(e) $24 (1) O/F from (c) [1]
[Total: 22]
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4 continued Theba – Petty Cash Book
Total Received
Date Details Total Paid Postages and stationery Motor expenses
Catering supplies
Cleaning
$ 24 36 38 12 70
$ 24 (1) 36 (1)
$ 38 (1)
$ 12 (1)
$ 70 (1)
60 38 12 70
$ 97 103 (1) 4 (1)
180 24
204 204
24 (1) 176 (1)
O/F
April 1 4 12 17 21 24 29 30 May 1
Balance b/d Bank Postage stamps Stationery Fuel Stationery refund Catering supplies Cleaning Balance c/d Balance b/d Bank/Cash
Totals of analysis columns (1); Totals of total columns (1) Dates (1) [12]
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5 (a) Additional finance Additional knowledge and skills Sharing of responsibilities Sharing of risks Discussions can take place before taking decisions Any 2 (1) each [2] (b) Profits have to be shared Decisions have to be recognised by all partners/disagreements may arise Decisions may take longer to put into effect One partner’s actions are binding on all partners All partners are responsible for the debts of the business Any 2 (1) each [2] (c) Raoul and Hassan Journal
Debit $
Credit $
Bank Capital Raoul
6000
6000
(1) (1)
Inventory Capital Hassan
4000 4000
(1) (1)
Rent Shop fittings Bank ( or Cash Book )
600 750
1350
(1) (1) (2)
[8] (d) Raoul and Hassan Profit and Loss Appropriation Account for the year ended 31 March 2012
$ $ $ Profit for the year 8800 (1) Less Interest on capital – Raoul 180 (1) Hassan 120 (1) 300 Partner’s salary – Rauol 3000 (1) 3300 5500 Profit shares – Raoul 2200 (2)(1) OF Hassan 3300 (2)(1) OF 5500 [8]
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(e) Raoul Current account
2012 $ 2012 $ Mar 31 Balance c/d 5380 Mar 31 Interest on cap 180 (1)O/F Salary 3000 (1) ____ Profit share 2200 (1)O/F 5380 5380 April 1 Balance b/d 5380 (1)O/F
[4] (f) Increase Raoul’s salary Allow commission on sales Change the profit-sharing ratio Any 1 (2) [2]
[Total: 26] 6 (a) (i) Current assets – current liabilities (1) (36 000 + 60 000) – (63 000 + 17 000) = 96 000 – 80 000 (1) = $16 000 (1) OF [3] (ii) Current assets : current liabilities (1) 96 000 : 80 000 (1) = 1.2 : 1 (1) OF [3] (iii) Current assets – inventory : current liabilities (1) 60 000 : 80 000 (1) = 0.75 : 1 (1) OF [3] (b) (i) Cole Limited (1)
Cole Limited can pay the immediate liabilities from the current assets and/or Fanza Limited’s ratio is lower than is usually acceptable (2) [3]
(ii) Cole Limited (1)
Cole Limited can meet the immediate liabilities from the liquid assets but Fanza may have difficulty in paying current liabilities when they fall due/Fanza Limited’s ratio is lower than is usually acceptable (2) [3]
(c) Receive a fixed rate of dividend
The dividend is paid before ordinary share dividend Capital is returned before ordinary share capital in a winding up Do not usually carry voting rights Preference shares are part of the capital of the company Preference shareholders are members of the company Any 2 (2) each [4]
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(d) Receive a fixed rate of interest Interest is paid irrespective of the profit of the company Are long term loans Are often secured on the assets of the company Debentures are repaid before share capital in a winding up Debenture holders are not members of the company Do not carry voting rights Any 2 (2) each [4]
[Total: 23]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2012 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/12 Paper 1, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2012 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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1 Key (a) A [1] (b) C [1] (c) B [1] (d) B [1] (e) A [1] (f) D [1] (g) D [1] (h) C [1] (i) C [1] (j) B [1]
[Total: 10] 2 (a) Purchases (ledger)/Trade Payables / Creditors [1] (b) Cost and net realisable value [1] (c)
Income Expense
Bad debt recovered �(1)
Carriage inwards �(1)
Discount received �(1)
[3] (d) (i) When a transaction is entered using the correct amount and on the correct side (1), but
in the wrong class of account. (1) Example – Motor Vehicles debited to the account of Motor Expenses Any suitable example of an error of principle (2) (ii) Compensating errors occur when two or more errors cancel each other out (2) Example – sales account undercast and wages account undercast Any suitable example of a compensating error (2) [8]
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(e) 4% × $28 000 = $1120 [1] (f) (i) $120 – $87.60 = $32.40 (1) (ii) $87.60 (1) [2] (g) Payments $715 Less opening accrual 240 (1) 475 Plus closing accrual 320 (1) Charge for the year 795 (1) [3] (h) (6000 × $1.50) or $9000 (1) × 3% × ½ = $135 (1) [2]
[Total: 21] 3 (a) Mitchell April 8 Amanda paid $120 in cash to Mitchell (1) Julian April 9 Amanda received a cheque, $194, from Julian (1) Julian was allowed $6 cash discount for prompt payment (1) Sylvia April 14 Amanda received a cheque, $180 from Sylvia (1) Sylvia April 21 The cheque, $180, previously received from Sylvia was dishonoured by the bank (1) Equipment April 26 Amanda purchased equipment, $2000, by cheque (1) Sales April 28 Amanda sold good for cash $1300 (1) [7] (b) This is a contra entry. (1) Office cash was paid into the bank (1) [2] (c) (i) The cash balance represents the cash in hand (1) The bank balance represents a bank overdraft (1) [2] (ii) Cash balance – current asset (1) Bank balance – current liability (1) [2] (iii) It is not possible to take out more cash than is available [2]
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(d) Amanda Mitchell account $ $
2012 April 6 Cash 120 (1) Julian account $ $ 2012 April 9 Bank 194 (1) Discount 6 (1) Sylvia account $ $ 2012 2012 April 21 Bank (dis.chq 180 (1) April 14 Bank 180 (1) Equipment account $ $ 2012 April 26 Bank 2000 (1) Sales account $ $ 2012 April 28 Cash 1300 (1) Discount allowed account $ $ 2012 April 30 Total for month 6 (1) + (1) for dates [9]
[Total: 24]
4 (a) (i) Expenses are overstated (1) Profit for the year is understated (1) [2] (ii) Non-current assets are understated (1) Owner’s capital (Profit )is understated (1) [2]
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(b)
Capital expenditure
Revenue expenditure
Purchase of computer �(1)
Purchase of laser printer �(1)
Replacement of hard disc in computer �(1)
[3] (c) (i) ($4800 + $750) (1) O/F based on answer to (b) – $600 (1) = $4950
(1) years3
$4950= $1650 (1) O/F [4]
(ii) ($4800 + $750) O/F based on answer to (b) – $1650 (1) O/F = $3900 (1) O/F [2] (d)
Non-current tangible asset
Non-current intangible asset
Current asset
Office building �(1)
Motor vehicle �(1)
Goodwill �(1)
Work in progress �(1)
[4]
[Total: 17]
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5 (a) Rachel Smith Income Statement for the year ended 31 March 2012 $ $ $
Revenue 63 100 (1) Less Cost of sales Opening inventory 3 100 (1) Purchases 42 500 (1) Less Purchases returns 1 900 (1) 40 600 Carriage inwards 1 050 (1) 41 650 44 750 Less Closing inventory 3 750 (1) 41 000 (1) OF Gross profit 22 100 (1) OF Less Carriage outwards 540 Bad debts 190 (1) Provision for doubtful debts 150 (1) Property tax (6000 – 1200) 4 800 (2) Wages (7100 + 180) 7 280 (2) General expenses 1 620 Depreciation – Equipment 1 920 (1) 16 500 Profit for the year 5 600 (1) OF [16]
(b) (i) O/F (1)(1)}
O/F} 35.02%
1
100
100 63
100 22=× [2]
(ii) Increase selling prices Reduce cost of purchases Any 1 comment (2) [2]
(c) (i) O/F (1)(1)}
O/F} 8.87%
1
100
100 63
600 5=× [2]
(ii) Reduce expenses Increase gross profit Increase other income Any 1 comment (2) [2]
[Total: 24] 6 (a) The business will continue to operate for an indefinite period of time (1) and there is no
intention to close down or significantly reduce the size of the business. (1) [2] (b) (i) Current assets : Current liabilities [1] (ii) 11 400 : 13 800 (1) = 0.83 : 1 (1) [2]
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(iii) Unsatisfied (1) The business cannot meet the immediate liabilities from the immediate assets (2) [3] (c)
Increase Decrease No effect
Capital �(1)
Current assets �(1)
Current liabilities �(1)
Non-current liabilities �(1)
[4] (d) To assess whether the interest can be paid when due To assess whether the loan can be repaid when due To assess whether there is security for the loan Any 2 reasons (2) each [4] (e) There are not enough non-current assets for security of the loan There is not enough profit to cover the loan interest The business would not be able to re-pay the loan on time Drawings for the year exceed the profit for the year Any 2 reasons (2) each [4] (f) Introduce additional capital Admit a partner/form a limited company Mortgage Loans from other sources Sell surplus non-current assets Any 2 (2) each [4]
[Total: 24]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2012 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/13 Paper 1, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2012 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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1 Key (a) C [1] (b) D [1] (c) D [1] (d) A [1] (e) B [1] (f) B [1] (g) D [1] (h) C [1] (i) A [1] (j) A [1]
[Total: 10] 2 (a) Invoice [1] (b) To show the financial position of a business on a certain date. [1] (c)
Asset Liability
Inventory �(1)
Rent receivable prepaid �(1)
Trade payables �(1)
[3] (d) To calculate how much it has cost the business to manufacture the goods (1) produced in the
financial year (1). [2]
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(e) (i) Money measurement (1) (ii) Relevance (1) [2]
(f) (300 × $10.30) (1) = $3090 – 4% = $3090 – $123.60 = $2966.40 (1) [2] (g) Land, buildings, machinery, equipment, fixtures, motor vehicles, goodwill Any 2 (1) each [2] (h) The business is treated as being completely separate from the owner. (1) The accounting records relate only to the business, (1) [2]
(i) (200 × $100) (1) = $20 000 × 3% × ½ = $300 (1) [2] (j) Payments $2100 Less opening accrual 350 (1) 1750 Plus closing accrual 470 (1) Charge for the year 2220 (1) [3]
[Total: 20] 3 (a) To assist in the preparation of financial statements To check for arithmetical accuracy/errors (must include arithmetical) Any 1 reason (1) [1]
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(b) Hans Lee Trial Balance at 30 April 2012
Dr $
Cr $
Revenue 110 000
Purchases 65 000
Inventory (1 May 2011) 11 500 (1)
Trade receivables 1 300 }
Trade payables 1 900 }(1)
Machinery 7 400
Expenses 31 600
Bank overdraft 3 100 (1)
Capital 11 500 }
Drawings 7 600 }(1)
Suspense (1) 2 100 (1) OF
126 500 126 500 (1)
[7] (c) Hans Lee Journal
Debit $
Credit $
1 Purchases Suspense
1 600 1 600
(1) (1)
2 Suspense John Tan
300 300
(1) (1)
3 Drawings Suspense
200 200
(1) (1)
[6]
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(d)
Increase Decrease No effect
Error 1 �(1)
Error 2 �(1)
Error 3 �(1)
[3] (e) All the errors have NOT YET been discovered. (1) There is a balance remaining on the suspense account/Trial Balance. (1) [2]
[Total: 19] 4 (a) To avoid recording small cash payments in the main cash book (2) To reduce the number of entries in the main cash book (2) Any one reason (2) [2] (b) The petty cashier starts each month with the same amount of money. (1) At the end of the period the amount spent is reimbursed so the cash remaining is equal to
the imprest amount. (1) [2] (c) Refer to next page [12] (d) Postages and stationery account
2012 $ 2012 $ April 30 Petty cash 60 (1) April 30 Petty cash 4 (1) Motor expenses account 2012 $ April 30 Petty cash 38 (1) Catering supplies account 2012 $ April 30 Petty cash 12 (1) Cleaning account 2012 $ April 30 Petty cash 70 (1) [5]
(e) $24 (1) O/F from (c) [1]
[Total: 22]
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4 continued Theba – Petty Cash Book
Total Received
Date Details Total Paid Postages and stationery Motor expenses
Catering supplies
Cleaning
$ 24 36 38 12 70
$ 24 (1) 36 (1)
$ 38 (1)
$ 12 (1)
$ 70 (1)
60 38 12 70
$ 97 103 (1) 4 (1)
180 24
204 204
24 (1) 176 (1)
O/F
April 1 4 12 17 21 24 29 30 May 1
Balance b/d Bank Postage stamps Stationery Fuel Stationery refund Catering supplies Cleaning Balance c/d Balance b/d Bank/Cash
Totals of analysis columns (1); Totals of total columns (1) Dates (1) [12]
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5 (a) Additional finance Additional knowledge and skills Sharing of responsibilities Sharing of risks Discussions can take place before taking decisions Any 2 (1) each [2] (b) Profits have to be shared Decisions have to be recognised by all partners/disagreements may arise Decisions may take longer to put into effect One partner’s actions are binding on all partners All partners are responsible for the debts of the business Any 2 (1) each [2] (c) Raoul and Hassan Journal
Debit $
Credit $
Bank Capital Raoul
6000
6000
(1) (1)
Inventory Capital Hassan
4000 4000
(1) (1)
Rent Shop fittings Bank ( or Cash Book )
600 750
1350
(1) (1) (2)
[8] (d) Raoul and Hassan Profit and Loss Appropriation Account for the year ended 31 March 2012
$ $ $ Profit for the year 8800 (1) Less Interest on capital – Raoul 180 (1) Hassan 120 (1) 300 Partner’s salary – Rauol 3000 (1) 3300 5500 Profit shares – Raoul 2200 (2)(1) OF Hassan 3300 (2)(1) OF 5500 [8]
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(e) Raoul Current account
2012 $ 2012 $ Mar 31 Balance c/d 5380 Mar 31 Interest on cap 180 (1)O/F Salary 3000 (1) ____ Profit share 2200 (1)O/F 5380 5380 April 1 Balance b/d 5380 (1)O/F
[4] (f) Increase Raoul’s salary Allow commission on sales Change the profit-sharing ratio Any 1 (2) [2]
[Total: 26] 6 (a) (i) Current assets – current liabilities (1) (36 000 + 60 000) – (63 000 + 17 000) = 96 000 – 80 000 (1) = $16 000 (1) OF [3] (ii) Current assets : current liabilities (1) 96 000 : 80 000 (1) = 1.2 : 1 (1) OF [3] (iii) Current assets – inventory : current liabilities (1) 60 000 : 80 000 (1) = 0.75 : 1 (1) OF [3] (b) (i) Cole Limited (1)
Cole Limited can pay the immediate liabilities from the current assets and/or Fanza Limited’s ratio is lower than is usually acceptable (2) [3]
(ii) Cole Limited (1)
Cole Limited can meet the immediate liabilities from the liquid assets but Fanza may have difficulty in paying current liabilities when they fall due/Fanza Limited’s ratio is lower than is usually acceptable (2) [3]
(c) Receive a fixed rate of dividend
The dividend is paid before ordinary share dividend Capital is returned before ordinary share capital in a winding up Do not usually carry voting rights Preference shares are part of the capital of the company Preference shareholders are members of the company Any 2 (2) each [4]
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(d) Receive a fixed rate of interest Interest is paid irrespective of the profit of the company Are long term loans Are often secured on the assets of the company Debentures are repaid before share capital in a winding up Debenture holders are not members of the company Do not carry voting rights Any 2 (2) each [4]
[Total: 23]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2012 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/21 Paper 2, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2012 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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1 (a) The cash book is a book of prime (original) entry because it is written up from business documents. (1) The cash book is part of the double entry system as it acts as ledger accounts for cash and bank. (1) [2] (b) Stewart Hanson Cash Book
Discount allowed $
Cash $ 100
1970
Bank $ 1942 2020
Discount received $ 12
Cash $ 2020 50
Bank $ 398 1795 250 115 1404
2070 3962 12 2070 3962
Date 2012 Jan 1 28 30 2012 Feb 1
Details Balances b/d Sales (1) Cash c (1) Balances b/d
50 (1)OF
1404 (1)OF
Date 2012 Jan 3 8 13 20 30 31
Details Paul Yim (1) Office equipment (1) Drawings (1) Sue West (dis. cheque) (1) Bank c (1) Balances c/d
+ (1) dates [10]
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(c) (i) Between 8 and 29 January the payments from the bank exceeded the money in the bank account. [2]
(ii) Purchase of equipment could possibly have been delayed until later in the month. [2] (d) The personal motor expenses have been treated as drawings and not as a business
expense. [2] (e) Journal
Debit $
Credit $
Bad debts Sue West Amount owed by Sue West written off as a bad debt
115 115
(1) (1) (1)
[3] (f)
Account debited Account credited
Bank (1) Bad debts recovered (1)
OR
Account debited Account credited
Sue West } Bank } (1)
Bad debts recovered } Sue West } (1)
[2] (g) Reduce credit sales/sell on a cash basis Obtain references from new credit customers Fix a credit limit for each customer Improve credit control Issue invoices and monthly statements promptly Refuse further supplies until outstanding balance is paid Any 2 points (1) each [2]
[Total: 25]
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2 (a) To assist in the location of errors To provide instant totals of trade receivables and trade payables To prove the arithmetical accuracy of the sales and purchases ledgers To enable a balance sheet to be prepared quickly To provide a summary of transactions relating to trade receivables and trade payables To provide an internal check on sales and purchases ledgers – may reduce fraud Any 2 points (1) each [2] (b) The purchases ledger control account acts as a check on the purchases ledger. If there is an
error in the purchases ledger it will not be revealed by a control account prepared from the individual accounts in the ledger. [2]
(c) Fatima Ayub Purchases ledger control account
2012 $ 2012 $ April 1 Balance b/d 38 April 1 Balance b/d 4 260 (1) for both balances 30 Purchases returns 243 (1) 30 Purchases 6 680 (1) Bank 3 705 (1) Interest charged 11 (1) Discount received 95 (1) Balance c/d 22 (1) Contra entry 320 (1) Balance c/d 6 572 (1) 10 973 10 973 2012 2012 May 1 Balance b/d 22 (1) May 1 Balance b/d 6 572 (1)OF + (1) dates [12]
(d) Overpayment to supplier Payment made without deducting cash discount Goods returned to supplier after payment of balance due Payment made in advance to supplier Any 2 points (1) each [2] (e) A contra entry is one which appears on the debit of the purchases ledger control account and
the credit of the sales ledger control account. (1) This entry is made when a sales ledger account is set off against an a purchases ledger
account of the same person/business. (1) [2]
[Total: 20]
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3 (a) Mark Mutanda Income Statement for the year ended 31 January 2012
$ $ Income from clients 82 100 (1) Rent received (2 600 – 200) 2 400 (2) Decrease in provision for doubtful debts (154 – 136) 18 (2) 84 518 Less Insurance (5 630 – 2 320) 3 310 (2) Wages and salaries (33 000 + 3 200) 36 200 (2) Rates 5 200 (1) Loan interest (900 + 300) 1 200 (2) Office expenses (17 177 – 214) 16 963 (2) Depreciation – Office equipment (1 900 + 600 (1) – 2 100 (1)) 400 Depreciation – Fixtures & fittings (10% × 5250) 525 (1) 63 798 Profit for the year 20 720 (1)OF [18]
(b) Mark Mutanda Capital account
2012 $ 2011 $ Jan 31 Office expenses Feb 1 Balance b/d 200 000 (1) (drawings) 214 (1) 2012 Cash (drawings) 16 000 (1) Jan 31 Profit 20 720 (1)OF Balance c/d 204 506 220 720 220 720 2012 Feb 1 Balance b/d 204 506 (1)OF + (1) dates [6]
(c) (1)OF(1)
(1)OF 9.42%
1
100
000 20 000 200
720 20=×
+
[3]
(d) This shows the profit earned for every $100 used in the business. (1) The higher the percentage the more efficiently the capital is being employed. (1) [2] (e) Lower profit for the year Higher capital employed Any 1 point (2) [2]
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4 (a) The accumulated fund represents the surpluses (less any deficits) the club has made since it was formed. [2]
(b) Dhavari Sports Club Calculation of Corrected Surplus for the year ended 31 March 2012 $ $
Original surplus 17 400 Add Insurance prepaid 300 (1) Expenditure overcast 100 (1) 17 800 Less Depreciation of equipment 1 400 (1) Bank charges 150 (1) Subscriptions prepaid 600 (1) 2 150 Corrected surplus 15 650 (1)OF [6]
(c) The income and expenditure account includes only revenue items The income and expenditure account includes non-monetary items The income and expenditure account adjusts figures for accruals and prepayments The receipts and payments account shows total money paid and received Any 2 points (2) each [4] (d) Dhavari Sports Club Balance Sheet at 31 March 2012 $ $ $
Non-current assets Premises at cost 70 000 Sports equipment at valuation 11 600 (1) 81 600 (1) Current assets Shop inventory 8 500 Subscriptions owing 1 500 (1) Other receivables 300 (1) Petty cash 200 (1) 10 500 (1)OF Current liabilities Trade payables 4 300 (1) Bank overdraft (1 400 + 150) 1 550 (1) Subscriptions prepaid 600 (1) 6 450 (1)OF Net current assets 4 050 85 650 Non-current liabilities Loan (repayable 1 January 2015) 10 000 (1) 75 650 Financed by Accumulated fund Opening balance 60 000 Plus Surplus for the year 15 650 (1)OF 75 650 [12]
[Total: 24]
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5 (a) The cost of inventory is the actual purchase price of the goods (1) plus any additional costs incurred in bringing the goods to their present position and condition. (1) [2]
(b) The net realisable value is the estimated receipts from selling the goods (1) less any costs of
completing the goods or costs of selling. (1) [2] (c) This ensures that the profit is not overstated (1) This ensures that the inventory is not overstated (1) [2] (d)
overstated understated no effect
(ii)
(iii)
profit for the year ended 31 December 2012 credit balance on capital account on 1 January 2013
� (2)
� (2)
[4]
(e) Cost of sales = 80% × 87 000 = 69 600 (1)
Average inventory = 2
400 7 000 6 + = 6700 (1)
Rate of turnover = 700 6
600 69 = 10.39 times (1) [3]
(f) Lower inventory levels More sales activity Any 1 reason (2) [2] (g) The business should be selling similar goods The business should be of a similar size Or other acceptable point Any 1 point (1) [1] (h) To assess the liquidity position To calculate the payment period for trade payables To determine the period of credit to be allowed To determine the credit limit To identify future prospects Any 2 reasons (1) each [2]
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(i) (i) Employee To assess the ability of the business to continue operating To consider the prospects for jobs and wages Any 1 point (1) [1] (ii) Bank manager To assess the prospect of any requested loan/overdraft being repaid when due To assess the prospects of any interest on loan/overdraft being paid when due To determine the security available to cover any loan/overdraft Any 1 point (1) [1]
[Total: 20]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2012 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/22 Paper 2, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2012 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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1 (a) Dalia Said
Purchases journal
Date
2012 March 2 8 31
Details
Essam Wholesalers Ramy El Din Less 20% Trade discount Transfer to Purchases a/c
$
680 136
$
1950
544 ____ 2494
(1) (1) (1)
[3]
Purchases returns journal
Date 2012 March 14 31
Details Ramy El Din Less 20% Trade discount Transfer to Purchases returns a/c
$ 120 24
$ 96 __ 96
(1) (1)
[2] (b) Dalia Said Essam Wholesalers account 2012 $ 2012 $ Mar 21 Bank 1911 (1) Mar 2 Purchases 1950 (1) Discount 39 (1) ____ (1) 1950 (1) 1950 (1) [3] Ramy El Din account 2012 $ 2012 $ Mar 14 Returns 96 (1) Mar 8 Purchases 544 (1) 28 Bank 300 (1) 31 Balance c/d 148 (1) ___ (1) 544 (1) 544 (1) 2012 Apl 1 Balance b/d 148 (1)O/F [4]
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(c) Purchases ledger/Creditors ledger [1]
(d) 1
365
400 33
2600× (1) = 28.41 = 29 days (1) [2]
(e) Money can be used for other things within the business May avoid bank charges/bank interest Any 1 point (1) [1] (f) Loss of cash discounts Creditors may refuse further supplies Creditors may insist on cash purchases in future Damage to good relationship with suppliers May be charged interest Any 1 point (1) [1] (g) Offer cash discount for prompt payment Charge interest on overdue accounts Improve credit control/send invoices or statements promptly Refuse further supplies until outstanding balance paid Invoice discounting and debt factoring Any 3 points (1) each [3] [Total: 20]
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2 (a) Simon Nyemba Commission received account 2011 $ 2011 $ Feb 1 Balance b/d 280 (1) Feb 5 Bank 280} (1) 2012 Aug 3 Bank 312} (1) Jan 31 Income 2012 Statement 608 (2) Jan 31 Balance c/d 296 (1) O/F 888 (1) 888 (1) 2012 Feb 1 Balance b/d 296 (1) + (1) dates [6] (b) Simon Nyemba Property tax account 2011 $ 2012 $ Feb 1 Balance b/d 520} (1) Jan 31 Income Apl 24 Bank 1620} (1) statement 3220 (2)O/F Oct 4 Bank 1620} (1) Balance c/d 540 (1) 3760 (1) 3760 (1) 2012 Feb 1 Balance b/d 540} (1) + (1) dates [6] (c) Accruals (matching) [1] (d) (i) Current assets (1) (ii) Current assets (1) [2] (e) Journal
Debit $
Credit $
Income statement Discount allowed Total discount allowed transferred to the income statement
324
324
(1) (1) (1)
[3] Continued/
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IGCSE – May/June 2012 0452 22
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(f) Simon Nyemba Provision for doubtful debts account 2012 $ 2011 $ Jan 31 Income Feb 1 Balance b/d 460 (1) Statement 31 (2) O/F Balance c/d 429 (1) ___ (1) 460 (1) 460 (1) 2012 Feb 1 Balance b/d 429 (1)
+ (1) dates [5]
(g) Prudence OR Accruals (matching) [1] [Total: 24] 3 (a) Herman Wagner Manufacturing Account for the year ended 30 April 2012 $ $ Cost of materials consumed (1) Opening inventory of raw materials 14 300 (2) Purchases of raw material 168 900 (2) Carriage on purchases 2 600 (2) 185 800 (2) Less Closing inventory of raw materials 16 400 (2) 169 400 (1) Direct factory wages 193 700 (1) Prime cost 363 100 (1) O/F Factory overheads Indirect wages (43 600 – 10 000) 33 600 (2) General expenses (24 450 – (¼ × 6200)) 22 900 (2) Depreciation – Factory machinery (20% × (98 000 – 35 280)) 12 544 (2) Loose tools (950 + 45 – 890) 105 (2) 69 149 (2) 432 249 (1) O/F Add Opening work in progress 6 520 (1) 438 769 (2) Less Closing work in progress 6 970 (1) Production cost of goods completed 431 799 (1) O/F [16]
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IGCSE – May/June 2012 0452 22
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(b) (i) Inventory of raw materials Goods remaining at the year-end which were originally purchased for converting into
finished articles (1) Example – wood, nails, screws, handles or other suitable example (1) [2] (ii) Inventory of work in progress Furniture which is partly made at the year end (1) Example – partly made table/ wardrobe/chair/other suitable example (1) [2] (iii) Inventory of finished goods Completed furniture which is awaiting sale (1) Example – finished table/wardrobe/chair/other suitable example (1) [2] (c) This is an application of the principle of materiality. It is not practical to keep detailed records of loose tools. Any 1 comment (2) [2]
(d) ( )( )
17.47%1
100
000 20000 130
000 144-200 170=×
+ (1)
(1) [3]
(e) Unsatisfied (1) The ratio is lower than the previous year. (1) The capital is not being employed as efficiently as in the previous year. (1) Accept answer based on the answer to (d) [3] [Total: 31]
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IGCSE – May/June 2012 0452 22
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4 (a) Creekside Ltd Balance Sheet at 30 April 2012 $ $ $ Non-current assets Cost Depreciation Book to date value Premises 120 000 (1) 120 000 (1) Plant and machinery 90 000 (1) 15 500 (1) 74 500 (1) Fixtures and fittings 32 000 (1) 6 400 (1) 25 600 (1) 242 000 (1) 21 900 (1) 220 100 (1) O/F Current assets Inventory 24 660 (1) Trade receivables 21 600 (1) Less Provision for doubtful debts 660 (1) 20 940 (1) Cash 200 (1) 45 800 (1) Current liabilities Trade payables 26 960 (1) Bank overdraft 5 340 (1) 32 300 (1) Net current assets 13 500 (1) O/F 233 600 (1) 4% Debentures 30 000 (1) 203 600 (1) Capital and reserves 5% Preference shares of $1 each 80 000 (1) Ordinary shares of $1 each 100 000 (1) General reserve 10 000 (1) Retained profits (6 500 (1) + 7 100 (1)) 13 600 (1) 203 600 (1) [15] (b) (i) $1600 [1] (ii) Effect Profit for the year is reduced (1) Reason Debenture interest is an expense (1 [2] (c) (i) $2000 [1] (ii) Reduction in profit (or dividend) available for ordinary shareholders Prior claim on the assets of the company in the event of a winding up Any 1 point (2) [2]
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(d) The new shares rank equally with the existing ordinary shares with regard to dividend. The new shares rank equally with the existing ordinary shares with regard to repayment in a
winding up. The percentage of ownership of the existing ordinary shareholders is diluted. Any 1 point (2) [2] [Total: 23] 5 (a) Bethany Searle Journal
Debit $
Credit $
2 3 4 5
Suspense Rent received Purchases returns Stationery - Suspense Sales Suspense
340 24 – 1000
340 24 100
1000
(1) (1) (1) (1) (1) (1) (1) (1)
[8]
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(b) Bethany Searle Statement of corrected profit for the years ended 31 March 2012 $ Profit for the year before corrections 14 940 Effect on profit Increase Decrease $ $ Error 1 96 (2)
2 340 (2) 3 No effect (2) 4 No effect (2) 5 ___ (2) 1 000 (2) 436 (2) 1 000 (2) 564 (2) Corrected profit for the year 14 376 (1) O/F [9] (c) (19 540 + 100) : (21 570 + 2 880) = 19 640 : 24 450 (1) = 0.80 : 1 (1) [2] (d) Shows whether the immediate liabilities can be paid from liquid assets Shows whether the business relies on the sale of inventory to pay the immediate liabilities Any 1 comment (2) [2] (e) The quick ratio does not include inventory. (1) Either Inventory is not regarded as a liquid asset (1) Or Inventory is two stages away from being a liquid asset. (1) [2] [Total: 23]
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UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
International General Certificate of Secondary Education
MARK SCHEME for the May/June 2012 question paper
for the guidance of teachers
0452 ACCOUNTING
0452/23 Paper 2, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the details of the discussions that took place at an Examiners’ meeting before marking began, which would have considered the acceptability of alternative answers.
Mark schemes must be read in conjunction with the question papers and the report on the examination.
• Cambridge will not enter into discussions or correspondence in connection with these mark schemes. Cambridge is publishing the mark schemes for the May/June 2012 question papers for most IGCSE, GCE Advanced Level and Advanced Subsidiary Level syllabuses and some Ordinary Level syllabuses.
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IGCSE – May/June 2012 0452 23
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1 (a) The cash book is a book of prime (original) entry because it is written up from business documents. (1) The cash book is part of the double entry system as it acts as ledger accounts for cash and bank. (1) [2] (b) Stewart Hanson Cash Book
Discount allowed $
Cash $ 100
1970
Bank $ 1942 2020
Discount received $ 12
Cash $ 2020 50
Bank $ 398 1795 250 115 1404
2070 3962 12 2070 3962
Date 2012 Jan 1 28 30 2012 Feb 1
Details Balances b/d Sales (1) Cash c (1) Balances b/d
50 (1)OF
1404 (1)OF
Date 2012 Jan 3 8 13 20 30 31
Details Paul Yim (1) Office equipment (1) Drawings (1) Sue West (dis. cheque) (1) Bank c (1) Balances c/d
+ (1) dates [10]
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(c) (i) Between 8 and 29 January the payments from the bank exceeded the money in the bank account. [2]
(ii) Purchase of equipment could possibly have been delayed until later in the month. [2] (d) The personal motor expenses have been treated as drawings and not as a business
expense. [2] (e) Journal
Debit $
Credit $
Bad debts Sue West Amount owed by Sue West written off as a bad debt
115 115
(1) (1) (1)
[3] (f)
Account debited Account credited
Bank (1) Bad debts recovered (1)
OR
Account debited Account credited
Sue West } Bank } (1)
Bad debts recovered } Sue West } (1)
[2] (g) Reduce credit sales/sell on a cash basis Obtain references from new credit customers Fix a credit limit for each customer Improve credit control Issue invoices and monthly statements promptly Refuse further supplies until outstanding balance is paid Any 2 points (1) each [2]
[Total: 25]
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IGCSE – May/June 2012 0452 23
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2 (a) To assist in the location of errors To provide instant totals of trade receivables and trade payables To prove the arithmetical accuracy of the sales and purchases ledgers To enable a balance sheet to be prepared quickly To provide a summary of transactions relating to trade receivables and trade payables To provide an internal check on sales and purchases ledgers – may reduce fraud Any 2 points (1) each [2] (b) The purchases ledger control account acts as a check on the purchases ledger. If there is an
error in the purchases ledger it will not be revealed by a control account prepared from the individual accounts in the ledger. [2]
(c) Fatima Ayub Purchases ledger control account
2012 $ 2012 $ April 1 Balance b/d 38 April 1 Balance b/d 4 260 (1) for both balances 30 Purchases returns 243 (1) 30 Purchases 6 680 (1) Bank 3 705 (1) Interest charged 11 (1) Discount received 95 (1) Balance c/d 22 (1) Contra entry 320 (1) Balance c/d 6 572 (1) 10 973 10 973 2012 2012 May 1 Balance b/d 22 (1) May 1 Balance b/d 6 572 (1)OF + (1) dates [12]
(d) Overpayment to supplier Payment made without deducting cash discount Goods returned to supplier after payment of balance due Payment made in advance to supplier Any 2 points (1) each [2] (e) A contra entry is one which appears on the debit of the purchases ledger control account and
the credit of the sales ledger control account. (1) This entry is made when a sales ledger account is set off against an a purchases ledger
account of the same person/business. (1) [2]
[Total: 20]
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3 (a) Mark Mutanda Income Statement for the year ended 31 January 2012
$ $ Income from clients 82 100 (1) Rent received (2 600 – 200) 2 400 (2) Decrease in provision for doubtful debts (154 – 136) 18 (2) 84 518 Less Insurance (5 630 – 2 320) 3 310 (2) Wages and salaries (33 000 + 3 200) 36 200 (2) Rates 5 200 (1) Loan interest (900 + 300) 1 200 (2) Office expenses (17 177 – 214) 16 963 (2) Depreciation – Office equipment (1 900 + 600 (1) – 2 100 (1)) 400 Depreciation – Fixtures & fittings (10% × 5250) 525 (1) 63 798 Profit for the year 20 720 (1)OF [18]
(b) Mark Mutanda Capital account
2012 $ 2011 $ Jan 31 Office expenses Feb 1 Balance b/d 200 000 (1) (drawings) 214 (1) 2012 Cash (drawings) 16 000 (1) Jan 31 Profit 20 720 (1)OF Balance c/d 204 506 220 720 220 720 2012 Feb 1 Balance b/d 204 506 (1)OF + (1) dates [6]
(c) (1)OF(1)
(1)OF 9.42%
1
100
000 20 000 200
720 20=×
+
[3]
(d) This shows the profit earned for every $100 used in the business. (1) The higher the percentage the more efficiently the capital is being employed. (1) [2] (e) Lower profit for the year Higher capital employed Any 1 point (2) [2]
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4 (a) The accumulated fund represents the surpluses (less any deficits) the club has made since it was formed. [2]
(b) Dhavari Sports Club Calculation of Corrected Surplus for the year ended 31 March 2012 $ $
Original surplus 17 400 Add Insurance prepaid 300 (1) Expenditure overcast 100 (1) 17 800 Less Depreciation of equipment 1 400 (1) Bank charges 150 (1) Subscriptions prepaid 600 (1) 2 150 Corrected surplus 15 650 (1)OF [6]
(c) The income and expenditure account includes only revenue items The income and expenditure account includes non-monetary items The income and expenditure account adjusts figures for accruals and prepayments The receipts and payments account shows total money paid and received Any 2 points (2) each [4] (d) Dhavari Sports Club Balance Sheet at 31 March 2012 $ $ $
Non-current assets Premises at cost 70 000 Sports equipment at valuation 11 600 (1) 81 600 (1) Current assets Shop inventory 8 500 Subscriptions owing 1 500 (1) Other receivables 300 (1) Petty cash 200 (1) 10 500 (1)OF Current liabilities Trade payables 4 300 (1) Bank overdraft (1 400 + 150) 1 550 (1) Subscriptions prepaid 600 (1) 6 450 (1)OF Net current assets 4 050 85 650 Non-current liabilities Loan (repayable 1 January 2015) 10 000 (1) 75 650 Financed by Accumulated fund Opening balance 60 000 Plus Surplus for the year 15 650 (1)OF 75 650 [12]
[Total: 24]
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5 (a) The cost of inventory is the actual purchase price of the goods (1) plus any additional costs incurred in bringing the goods to their present position and condition. (1) [2]
(b) The net realisable value is the estimated receipts from selling the goods (1) less any costs of
completing the goods or costs of selling. (1) [2] (c) This ensures that the profit is not overstated (1) This ensures that the inventory is not overstated (1) [2] (d)
overstated understated no effect
(ii)
(iii)
profit for the year ended 31 December 2012 credit balance on capital account on 1 January 2013
� (2)
� (2)
[4]
(e) Cost of sales = 80% × 87 000 = 69 600 (1)
Average inventory = 2
400 7 000 6 + = 6700 (1)
Rate of turnover = 700 6
600 69 = 10.39 times (1) [3]
(f) Lower inventory levels More sales activity Any 1 reason (2) [2] (g) The business should be selling similar goods The business should be of a similar size Or other acceptable point Any 1 point (1) [1] (h) To assess the liquidity position To calculate the payment period for trade payables To determine the period of credit to be allowed To determine the credit limit To identify future prospects Any 2 reasons (1) each [2]
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(i) (i) Employee To assess the ability of the business to continue operating To consider the prospects for jobs and wages Any 1 point (1) [1] (ii) Bank manager To assess the prospect of any requested loan/overdraft being repaid when due To assess the prospects of any interest on loan/overdraft being paid when due To determine the security available to cover any loan/overdraft Any 1 point (1) [1]
[Total: 20]
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