DIRECTORATE FOR QUALITY AND STANDARDS IN EDUCATION

Department of Curriculum Management

Educational Assessment Unit

Annual Examinations for Secondary Schools 2016

FORM 3 ACCOUNTING MARKING SCHEME

SECTION A
10 marks in total – 1 mark for each correct answer
1 (d); 2 (a); 3 (c); 4 (d); 5 (c); 6 (b); 7 (d); 8 (d); 9 (a); 10 (b)

11. SECTION B
10 marks in total – 1 mark each correct answer.
COLUMN A COLUMN B
0 A book showing how transactions will be recorded C Capital
A Net sales less cost of sales F Petty cash book
B Useful resources used by a firm E Working capital
The value of resources in a business provided by the
C H Drawings
owner
D People to whom the firm owes money 0 Journal
E Current assets less current liabilities J Cash book
The book where the payments of small amounts of
F G Ledger
money are recorded
G A set of accounts which are common in nature A Gross profit
H Assets taken by the owner for personal use I Business entity
The concept which requires us to separate business
I B Assets
transactions from personal transactions
J A book where all payments and receipts are recorded D Trade payables

SECTION C
10 marks – Each question carries 2 marks
12. The matching concept requires that expenses and revenues are recorded when they
occur (1), irrespective of the time when payments are made or received (1).
13. In the double entry system each transaction is recorded by two opposite (1) but equal
entries (1).
14. Book-keeping is the recording of transactions (1) while in accounting we try to interpret
the results for the managers and the owners (1).
15. The purchases day book contains a list of credit purchases (1) while the purchases
ledger contains the accounts of credit suppliers (1).
16. Capital expenditure is the expenditure to buy or upgrade non-current assets (1) while
revenue expenditure is the expenditure incurred in the daily operation of the firm with
the aim of earning revenue from such expenditure (1).

Accounting – Marking Scheme – Form 3 Secondary – 2016 Page 1 of 3

SECTION D [70 marks]

17. (a)
Cash Book
Discounts Discounts
2016 Cash Bank 2016 Cash Bank
Allowed Received
Mar 1 Bal b/d  211  3,984 Mar 2 T Abela  4  76
Mar 4 C Pace  98 Mar 2 C Borg  13  247
Mar 6 Sales  49 Mar 2 D Calleja  22  418
Mar 9 R Spiteri  4  156 Mar 7 Insurance  65
Mar 9 J Tanti  16  624 Mar 12 Motor expenses  150
Mar 9 R Privitelli  13  507 Mar 21 Salaries  5,200
Mar 20 IRD  200 Mar 23 Rent  60
Mar 18 Sales  98 Mar 28 Electricity  400
Mar 28 Loan: BOV  500 Mar 31 Stationery  570
Mar 31 Bal c/d  793 Mar 31 Bal c/d  34
 33  309 6,911  39 309  6,911

General Ledger
Discounts Allowed
2016 € 2016 €
Mar 31 Cash book (Total for the month)  33

Discounts Received
2016 € 2016 €
Mar 31 Cash book (Total for the month)  39

(33 marks – 1 mark for every correct ticked item)

(b) Cash discount is the discount allowed by suppliers to their customers for prompt payment (1) while trade discount is the discount
allowed by suppliers their customers for bulk purchasing and for loyalty (1). (2 marks)

Page 2 of 3 Accounting – Marking Scheme – Form 3 Secondary – 2016

18. Albert Galea
Income Statement for year ended 31 December 2015
€ €
Sales  120,000
Sales Returns  (3,500)
 116,500
Less Cost of Sales:
Opening Inventory  6,500
Purchases  80,000
86,500
Purchases Returns  (4,000)
82,500
Closing Inventory  (9,000)  (73,500)
Gross Profit  43,000
Discounts Received  600
43,600
Less Expenses:
Rent  3,000
Wages  12,000
Motor expenses  1,200
Lighting and heating  2,600
Insurance  3,600
Discounts Allowed  800
Bank Loan Interest  4,000  (27,200)
Net Profit  16,400

Statement of Financial Position as at 31 December 2015

Non-Current Assets € €
Furniture  8,000
Motor Vans  42,000
Equipment  20,000
 70,000
Current Assets
Inventory  9,000
Trade Receivables  5,000
Bank  4,600
Cash  180  18,780
 88,780
Capital
Balance 1 January 2015  30,680
Net Profit  16,400
47,080
Drawings  (15,000)
32,080

Non-Current Liabilities
8% Bank Loan  50,000

Current Liabilities
Trade Payables  6,700
 88,780
(35 marks – 1 mark for every correct ticked item)

Accounting – Marking Scheme – Form 3 Secondary – 2016 Page 3 of 3