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AUCKLAND GRAMMAR SCHOOL

ACCOUNTING
Form 5 - Pre-Q
Term 1 Examination, 2023

NAME: FORM: TEACHER:

TIME: 1 HOUR TOTAL MARKS: /80

EXAMINATION INFORMATION:

CONTENT MARKS YOUR MARK

Question 1 Multiple-Choice 15

Question 2 Theory 8

Question 3 Double Entry and Ledger 12

Question 4 Cashbook 10

Question 5 Financial Statements & Balance Day 35

Adjustments

Total 80

INSTRUCTIONS:
Answer all questions in the space provided on this paper.
DO NOT use pencil, red or green pen, or correction fluid.
Student name - _____________________ Teacher name - _____________________

Section One – Multiple Choice (answer in the grid on bottom of page 4) [15]

1 What is the purpose of accounting?

A. To ensure the cash book balance agrees with the bank statement.
B. To know how long trade receivables, take to pay.
C. To prepare the financial statements of the business.
D. To write up all the ledger accounts.

2 Which of the following decreases Cost of sales?

A. Purchases.
B. Carriage inwards.
C. Carriage outwards.
D. Closing inventory.

3 The major disadvantage of owning a sole trader business is

A. that it is separate legal entity.

B. it is difficult to have a holiday.
C. the business is likely to fail.
D. unlimited liability

4 Which of the following accounting equation is not correct?

A. Assets - Liabilities = Capital.

B. Assets - Capital = Liabilities.
C. Assets + Liabilities = Capital.
D. Liabilities + Capital = Assets.

5 When a business makes a profit, which of the following is correct?

A. Owner’s capital increases.

B. Owner’s capital decreases.
C. Owner’s capital remains the same.
D. Owner’s capital remains the same but drawings increase.

6 Which of the following best describes the meaning of ‘Purchases’?

A. Items bought.
B. Machinery purchased.
C. Goods bought to resell.
D. Money spent.
Student name - _____________________ Teacher name - _____________________

7 The Accounting Entity Concept assumes that

A. the owner and the business are the same accounting entity.
B. the owner and the business are different accounting entities.
C. the owner and the business measure the transactions in money value.
D. the owner and the business measure the transactions in financial and non-financial
information.

8 Which of the following is not an example of a Non-Current asset?

A Premises.
B Fixtures.
C Advertising.
D Equipment.

9 Which of the following is not normally a current asset

A cash.
B bank.
C trade receivables.
D opening Inventory.

10 Which item limits the usefulness of financial statements?

A Debits which no longer be collected are written off.

B Depreciation is provided on all non - current assets except land.
C long term loans are disclosed separately from short term loans.
D older assets may be recorded at values which are no longer up to date

11 Net current assets is

A sales less cost of sales.

B total revenue minus total expenses.
C current assets less current liabilities.
D assets less liabilities.

12 What is a compensating error?

A Credit sales debited to the sales account and credited to the customer’s account.
B Purchases of fixtures on credit debited to the repairs to fixtures account.
C Borich’s account credited with a cheque received from Brown, another customer.
D Sales account and sales returns account undercast by the same amount.

ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023

Page 3 of 13
Student name - _____________________ Teacher name - _____________________

13 During the year ended 31 December 2020 wages of $4000 were paid. At 31
December wages of $1200 were owed.
How much should have bene entered into the Income Statement for wages for the years
ended 31 December 2020.

A $3800
B $5000
C $5200
D $6200

14 What is meant by Duality?

A For every entry in the journal there must be a corresponding entry in the ledger.
B For every trade receivable (debtor) there must be a trade payable (creditor).
C For every debit entry, there is a corresponding credit entry.
D There are two sides to every financial statement.

15 Roel receives a cheque from Haku, a debtor in payment for goods purchased by Haku.
Where will Roel enter this payment.

a. Cash book and sales book

b. Cashbook and purchase ledger.
c. Purchase ledger and sales ledger.
d. Cashbook.

Answer Grid – Multiple choice

1 6 11
2 7 12
3 8 13
4 9 14
5 10 15

[15 marks]

ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023

Page 4 of 13
Student name - _____________________ Teacher name - _____________________

Question 2 Theory [6 marks]

Define the following accounting concepts and give an of example of its application.
(i) Historical Cost Concept
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_______________________________________________________________________ [2 marks]

(ii) Going Concern Concept

_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
________________________________________________________________________ [2 marks]

b. State one reason why each of the following people are interested in Solomon’s financial
statements.

Government
________________________________________________________________[1 mark]
Employees
________________________________________________________________[1 mark]

c) Fully explain the following accounting terms.

Assets
__________________________________________________________________________
__________________________________________________________________________
___________________________________________________________________[1 mark]

Owner’s Equity
__________________________________________________________________________
__________________________________________________________________________
___________________________________________________________________[1 mark]

ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023

Page 5 of 13
Student name - _____________________ Teacher name - _____________________

Question 3 Double Entry and ledger [10 marks]

Masuma owns a furniture store. She maintains a full set of accounting records.

Masuma provided the following information at 31 March 2022.

(a) On 1 March 2022 Amina, a credit customer, owed $160. On 2 March 2022 she paid
75% of this and the balance was written off as a bad debt.

(b) On 4 January 2022 additional fixtures and fittings, $2000, were purchased on
credit from Office Traders, but this transaction was not recorded.

(c) On 31 March 2022 the discount columns in the cash book showed the following
totals for the month:
discount column on debit side $55 discount
column on credit side $68
These totals had not been transferred to the discount accounts in the ledger.

REQUIRED

1 Record this information in the following accounts in Masuma’s ledger. Balance the
accounts where appropriate.

ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023

Page 6 of 13
Student name - _____________________ Teacher name - _____________________

Amina account
Date Details $ Date Details $
2022
1/03 Balance b/d 160

[2 marks]
Bad debts Account

Date Details $ Date Details $

2022
01/03 Total writen off 135

[2 marks]
Fixtures and Fittings Account

Date Details $ Date Details $

2022
01/03 Bal b/d 4000

[2 marks]
Discount allowed Account
Date Details $ Date Details $
2022
01/03 Total to date 3590

[2 marks]

Discount Received Account

Date Details $ Date Details $

2022
01/03 Total to date 4130

[2 marks]

ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023

Page 7 of 13
Student name - _____________________ Teacher name - _____________________

Question 4 Cashbook [10 marks]

The balances in JB’s three column cash book at 31 August 2022 were as follows:

Cash $1862

Bank overdraft $4,472

The following transactions took place:

Sep 3 paid Electricity bill by cheque $670.

4 cash sales $224.

5 banked $500 cash.

5 received a bank transfer of $2,475 from N Ltd in full settlement of

debt of $2,490.

8 paid rent by direct debit $123.

8 paid Creditor LJ by bank transfer of $590 after deducting 2% cash

discount.

10 withdrew $500 cash from bank for personal use.

10 paid wages $580 in cash.

Required: Enter the above transactions in the cash book on the next page and balance the cash book
at 10 September 2022.

ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023

Page 8 of 13
Student name - _____________________ Teacher name - _____________________

JB’s CASH BOOK

Discount Discount
Date Details Cash Bank Date Details Cash Bank
allowed received

2022 2022

[10 marks]

ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023

Page 9 of 13
Student name - _____________________ Teacher name - _____________________

Question 5 Financial Statements & Balance Day Adjustments [18 marks]

The following information was extracted from the books of Jae’s business on 31March 2022. Prepare
his business’s Income Statement for the year ended 31 March 2022.

Jae’s supplies
Trial Balance as at 31 March 2022

Inventory (1 April 2021) 60 000

Sales 395 000
Carriage Inwards 500
Carriage Outwards 3 000
Rent Received 1 500
Purchases Returns 2 500
Electricity 3 500
Property repairs 3 000
Interest 6 000
Purchases 196 500
Sales Returns 5 000
Capital (1 April 2021) 476 000
Shop Fixtures 25 000
Wages 20 000
Trade receivables 13 000
Cash 500
Bank 2 000
Drawings 35 000
Equipment 45 000
Property 500 000
Trade payables 34 000
Loan (due in 2029) 5 000

$916 000 $916 000

OTHER INFORMATION:

1. Inventory at end of the year, 31 March 2022, $20 000.

2. Wages due $200.
3. Rent received in advance $300
ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023
Page 10 of 13
Student name - _____________________ Teacher name - _____________________

Income Statement of Jae’s Supplies for the year ended 31 March 2022

$ $
Sales

Less: Cost of Sales

[18 marks]
ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023
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Student name - _____________________ Teacher name - _____________________

Part B [17 marks)

The following information was extracted from the books of Roel’s Enterprise on 31March 2023.
Prepare his business’s a fully classified Statement of Financial Position (Balance Sheet) as at
that date.

Roel’s supplies
Trial Balance as at 31 March 2023

Inventory (1 April 2022) 120 000

Sales 495 000
Rent 1000
Electricity 6 000
Commission 2 5 000
Purchases Returns 3 500
Telephone 4 500
Plant repairs 5 000
Interest 7 000
Purchases 296 500
Sales Returns 10 000
Capital ?
Furniture 35 000
Salaries 30 000
Trade receivables 23 000
Cash 1500
Bank overdraft 4 000
Drawings 45 000
Computer 55 000
Property 600 000
Trade payables 43 000
Loan (due in 2039) 10 000

1239 500 1239 500

OTHER INFORMATION:

1. Calculate capital for Roel’s Suppliers.

2. Net profit $120 300
3. Inventory at end of the year, 31 March 2023, $80 000.
4. Electricity due $200.
5. Commission received in advance $3000
ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023
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Student name - _____________________ Teacher name - _____________________

Roel’s Enterprise
Statement of Financial Position (Balance Sheet) as at 31 March 2022

$ $
Non Current Assets

[17 marks]

ACCOUNTING, Form 5 - Pre-Q, Term 1 Examination, 2023

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