Surname

Centre
No.

Initial(s)

Paper Reference

Candidate
No.

6 0 0 1

0 1

Signature

Paper Reference(s)

6001/01

Examiner’s use only

London Examinations GCE

Team Leader’s use only

Accounting (Modular Syllabus)
Advanced Subsidiary/Advanced Level
Unit 1:The Accounting System and
Costing
Tuesday 17 May 2011 – Morning
Time: 3 hours

Question Leave
Number Blank

1
2
3
4
5
6

Materials required for examination
Nil

Items included with question papers
Source Booklet

7

Instructions to Candidates
In the boxes above, write your centre number, candidate number, your surname, initial(s) and signature.
Check that you have the correct question paper.
Answer FIVE questions, choosing TWO from Section A and THREE from Section B.
Indicate which question you are answering by marking the box ( ).
If you change your mind, put a line through the box ( ) and then indicate your new question with a
cross ( ).
All calculations must be shown.
Write your answers in the spaces provided in this question paper.
Do not return the insert with the question paper.

Information for Candidates
The marks for individual questions and the parts of questions are shown in round brackets: e.g. (2).
There are 7 questions in this question paper. The total mark for this paper is 200.
There are 40 pages in this question paper. Any blank pages are indicated.
Calculators may be used.
The source material for use with questions 1 to 7 is in the enclosed source booklet.

Advice to Candidates
Write your answers neatly and in good English.
This publication may be reproduced only in accordance with
Edexcel Limited copyright policy.
©2011 Edexcel Limited.
Printer’s Log. No.

P38646A
W850/6001/57570 1/1/1/1/1/e2/

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SECTION A
Answer TWO questions from this section.
If you answer question 1, put a cross in this box (

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Source material for question 1 is on pages 2 and 3 of the source booklet.
1.

(a) Prepare for Pavlena the:
(i) statement of comprehensive income (trading and profit & loss account) for the
year ended 30 April 2011
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(ii) statement of financial position (balance sheet) as at 30 April 2011.
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................................. ............................................................................................................................................................................................................................ ............................................................................................. ..................................... ................................ ................................................................................................................................................................................................ ..................................................................................................................................................................... ................................................................................................................................................................ ............................................................................. .................................................................................................................................................................................................. ................................................................................................................................................................... .................................................................................................................................................................................................................................................................................................. (15) *P38646a0540* 5 Turn over ........................................ ............................................................................................................................................................................................................................................................................................................................... .......................................... ................................................................................................................................................................................................................................................................... ........................................................................................................................................Leave blank ..... ........ ................................................................................... .................................................................. ............................................................................................................... .................................................................................................. ........................................................................................................ ....................................... ............................................................................................. ..............................................................................................................................................

............................................................................. to the fixtures and fittings account..................................................................................................................................................................................................................................................................... (b) (i) Name this type of error.................. ........................................................................................................................................................................................................................................................ in error.......... ........................... .................................Leave blank During the year repairs to fixtures and fittings were posted........................................................ .................................... ............................................................................................................................................................... (1) (ii) Explain why the posting to the fixtures and fittings account was an error...................................................................................................... ...................................... .................................................................... .................. ........................................................................................ ....................................................................................................................................................................................... (3) 6 *P38646A0640* ............................................................... including narrative............................. ....... ................................ (4) (iii) Prepare the journal entries............................................. .............................................................................................................................. to correct the error.......................................................................................... .................................................................................................................................................................................................................................. ................................................... ............. .................................................................................................................................................................................................................. ............................................. ..................................................................................

..................................... ...................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... .............................................................. .......................................................................................................................................................................................... ....... (6) *P38646a0740* 7 Turn over ................................................................................................................................................................................................................................................. .................................................. ................................................ ................................................................................................... ..................................... ............................................................................................................................................ ............................................................................................................................................................................................................ ............. ............. .................. ................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... .................................................................................................................. ............................................................................................. ...................................................... ........................................................................................................................... .................................................................... .............................. ...... ............................................................................................................................................................................................... .............................................................Leave blank (c) Distinguish between straight line and diminishing balance as methods of depreciation................... .......................................................................................................................................................................................................................

................ ............................. ............................................................ ........................................................................................................................................................................................................................................ ............ ............................................................. ............................................................................................................... ...................................................................................................................................................................................................................................................................................................... .............................................................................. ..................................................................................... .......................... ............................................... ................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. ................................................................................................................. .................................................................................Leave blank (d) Evaluate the decision of Pavlena to use the diminishing balance method to depreciate her motor vehicles.......................................................................................................... ..................................................................................................................................... ...................................................................................................................................................................................................................................................................................... ............................................................................................... (8) (Total 52 marks) 8 *P38646A0840* Q1 ................................................................................. ................................................................................................................................................................................................................... ................................................................................................................................................................ ....................................................................................................................................................................................................................... ......................................................................... .. ...........................

........................................................................................................................................................................................................................Leave blank If you answer question 2...................................................... ..................................................................................................................................................................................................................................................... ........................ ................................................................................................................................................................................................. .......................................................................................................................................................................... ...................................... .................................................. Source material for question 2 is on pages 4 and 5 of the source booklet.... ........................................................................................................................................................................................................................................................................................................................................................................... ............................................ ............................................................................... ............................ ................... ........................................................ put a cross in this box ( )......................... ......................................................................................... showing the total value of the revenue (sales) for the year...................................................................... 2.... ...................................................................................... ..................................................................................................................................................................................... ....................................... .................................................................................. ............................................................................................................................................................................................................................................................................................................... .............................................................................................................................................................................. .. (7) *P38646a0940* 9 Turn over ................................................ ............................................................................. (a) Prepare the Sales Ledger Control Account for the year ended 31 March 2011...............................................................................

................................................................................................................................................................................................................................................................................... ............................................................................................................. ................ ............ ......................................................................................................................................................................... .......................... .................................................................................................................................................. .................................................................................................................................................................................................................................................................................. Balance the accounts as necessary.................................. .................................................................................................................................................................................................................................................................................. ................................................... .......................................................................................................... ............... ...................................................................................................................................................... ..........................................................................Leave blank (b) Prepare the following ledger accounts for the year ended 31 March 2011................................................................................ showing the transfers to the statement of comprehensive income (profit & loss account)................... ................ ........................................................................................................................................................................ ...................................................................................................................................................................................................................................................................................................................................... (i) Commission receivable account (ii) Rent account (iii) Wages account (iv) Marketing expenses account .............................................. ........................................................................................................................... 10 *P38646A01040* ............................................... ............................................................................................................. ............................................................................................................... ...............................................................

........................................................................ ........................................................................................................................................................................ ........................................................................... .................................................. ........... ................................................................................ ............ ..................................................................................................................................................................................................................................................... ............................................................................... . ..Leave blank ....................................................................................................................................................................................................................................................................................... ....................................................... .................................................................................. ............................................................... (23) *P38646a01140* 11 Turn over .. .................................................................................................................................................................... ................................................................................................................................................................................................................................................ ........................................................................................................................................................................................................................................................................................................................................................................................ ............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................................................................................................... ........................ .................................................................................................................................................................................................................................................................... ................................................ ............ ...................................................................................

............................................................................................................................... ...............................................................................................................................................................................................................Leave blank (c) Prepare the statement of comprehensive income (profit & loss account) for the year ended 31 March 2011............. ..................................................................................................................................................................................................................................................................... ..................................................................................................................................................................................................................................................................................................................... ........... .................................................................................................................................................................... .................... ............................................................................................................................................................................................................................................... ............... (8) 12 *P38646A01240* ................................................................................... ................................. ................................................................... ........................... .......................... ..... .......................................................................................... ................................................................................................................................. .................................................................................................... ................................................................................ .................................................................................................................................................................. ....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... ................................................................................... .................................................................... .................................................... ................................................................................................... .............................................................................................................................................................................................................

........................................................................................................................................................................................................................... ......................................................... .......................................................................................................................................................................... ........................................... ...................................................................................................................................................................................................................................................................................................................................................................................................................................Leave blank At a meeting with her accountant............................................................................................................................................................. ....................................................................................... ............ .......................................................................................................................................................... .................................................................................................................................................................................................................................................. ....................................... ......................................................................................................................................................................................................................... .............................. (d) Explain the meaning of: (i) accounting concepts (ii) the accounting concept of accruals (iii) the accounting concept of going concern....................................................................................................................... ................................................ .................. Haider was informed that her accounts would need to comply with the accounting concepts of accruals and going concern.............................................................................. ............................................................................................................................................................................................................................................ ............................................................................................................... ............................... . .......................................................................................................................................................................... ....................... *P38646a01340* 13 Turn over ........... .............................................................................................................................................. .....

. ................................................................................................................... ........................................................................................................................ ............................................... .......................................................................................................................................................................................................................................................................................................................................................................................................... ......................................................................................................................... ........ .................................................................................................................................... .................................................................. ................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. ...................................................................................................................................................................................................... ........................... ...................................................................................................................................... ............................................................ .......................................................................................Leave blank . .................................................. ................................................................................................................................................................................................................................................. (6) 14 *P38646A01440* .......................................................................................................... .............................. ....................................................................... ......................................................................................................................................................................... .......................... ...................... ............................................................................................................................................................................................................................................................ .............................................. ...................

............................................................................................................................. .............................................................................................. .............................................................................................. .................................................................................................................................................................................................... ............................................................................................................................... ......................................................................................................... ...................................................................................................... ............................................................................................................................................ .................................................................................................................. ...................................................................................................... .................................................................................................................................................................................................. ................................................................................................................................................................................................................... ........ (8) Q2 (Total 52 marks) *P38646a01540* 15 Turn over .......................................................................................................... ................................................................................... ......................................................................................................................................................... ...........................................................................................Leave blank (e) Evaluate the use of accounting concepts when preparing financial statements (final accounts).................................................................................................................................................................................................................................................................................................................................................................................................... ................................................. ................................................................................................................................................................................................................................................... ...................................... ...................................................... .................................................................................................. ............................ ......................................... ...........................................................................................................................

............ ...................................................................................................................................................................................................... ........................................... ............................................................................................................................................................. .......................................................................................................................................... 3............................................................................................................................. ................................................................................................................................................................................................................................................................................................................................................................................ ........................................... ................................................................................ ..................................................................................................................... .................... ......................................... ................ Source material for question 3 is on pages 6 and 7 of the source booklet............................................................................................................................................................................................. ........................................................................ (4) 16 *P38646A01640* .........................................Leave blank If you answer question 3................................................................................... ................................................. (a) Distinguish between the terms profit and profitability.................................................................................................... ........ ......................................................................................... ................................. .................................................................................................................................................................................................................................................................................................... ................................ put a cross in this box ( )............................................. ................................................................................................................................................................................................................. ............................. ....................................................................................................................................................................................................................................................................................................... ....................................................

..................................... ................................................................................................................................. ............................................ .... .................................................... ........................................................................................................................................................................................................................................................................................................ (6) (ii) Profit for the year (net profit) to revenue (sales) percentage ............................................................................................................................................................. .............................................. .................................................................................................................................................................................................................................. ........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... . (6) *P38646a01740* 17 Turn over ........................................................................................................................................................................................................Leave blank (b) Calculate the following ratios for Hilltec and Microtech: (i) Gross profit to revenue (sales) percentage ...... .................................................................................................................. ................. ............ ............................................................................................................................................................................................................................................................... .................................................................................................................................................................................................................................................. ........................................... ............. ........................................................................... .............................. ............................................................................................................................................................................................. ..........................................

.............................................................................. ............................................................................................................................................................................................ ........................................... ........................................... ......................................... .................... (6) (iv) Current ratio .................................. ........................................................................................ ........................................................ ........................................................... ............................................................................................................. ...................................................................................................................................................................................................................................... ......................... ................... ............................................................................................................................................................................................................................................................................................................................ ................................................................................................................................................. (6) 18 *P38646A01840* ......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... .................................................................................................................................................... ................................................................................................................................................Leave blank (iii) Return on capital employed ......................................................................................... ........................................ .................... ......................................................................................... ................

.............................. (6) (c) State four non financial factors that Bell Computers may need to consider when purchasing one of the businesses...................................... .............................................................................................................................................................................................................................................................................................................................. ........................................................................................... ...................................................................................................................................................................................................................................................................................................................................................................... ....................................................................................Leave blank (v) Collection period for trade receivables (debtors) ............................................................... ......... ................................................................................................................................................................................................................................................................ ........................................ ............................ ......................... ..................... .................................................................................................................................................................................................................................................................... ............... ......................................................................................................... (4) *P38646a01940* 19 Turn over ................................................................................................. .............................. ..... ............................................................................................................................... ................................................................................................................................................................. ..................................................................................................................................... ........................................................................................................................................................................................................................................................................................................................................................................................................ ................................................................. .........................................................................................................................................

..................................... .................. ............................................................. Microtech or neither of the businesses......................................................................................................................................................................................................................................... (6) 20 *P38646A02040* ................... ................................................................................................................................... ...................................................................................................................................................................................................................................... ............................................................................................................................. .............................................................. ... ............................................................................................................................................ ....................................... ........................................................................Leave blank (d) Advise Bell Computers whether it should purchase Hilltec............................. ...................................................................................................... ................................................................................................................................................................................................................................................................................................................................................................................................................................... ................................................................................................................................ Give three reasons for your decision............................................................................................... ........................ .......................... ..................................................... ............................................................................................................................................................................................................................................................... ...................................................... ..................... ..................................................................................................................................................................................................................................................................... ....................................................................................... ............................... .............................................................................................................................................................. ...........................................................................................................................................................................................................................................................................................................................................

................................................................................................................................................................................................................................................................................................................................ .................................................................................................................. ................................................................................................ ...................................... .................. ............................... ........ ......................................................................................................................................................................................................................................................... ............ (8) Q3 (Total 52 marks) TOTAL FOR SECTION A: 104 MARKS *P38646a02140* 21 Turn over .................................................................................................................................................................................................................. ................................ ...................................................................Leave blank (e) Evaluate the use of ratios in determining the suitability of a business for purchase.......................................... ............................................................................................................................................................................................................................................. ..................................................................................................................... .............................................................................................................................................................................................................................................................................................................................................................................................................................................. ............................................................................................ ...................................................................................................................................................................................................................................... .......... ............................................................................................... .................................................................................... .............................................................................................................................. .................................................................................................................................................................................................................................................................................................... .............................. .................................................... ...........................................................................

.................................................................................................................................................................................... ........................................................................................................Leave blank SECTION B Answer THREE questions from this section.................................................................................................................................. 22 *P38646A02240* .......................................................................... put a cross in this box ( )...................................... 4.................................................................... ... ......................................................................................................................................................... ........................................................................ .... ................................................................................................................................................................................................................................... ......................... ............................ ...... ............... ....................................................................................................................................................................... If you answer question 4........................................ (6) .................................................................................................................................................................................................................................... .......... .......................................................................................................................................... ............................................................................................................ .................................................................. .......... (a) Prepare the following to record the dissolution: (i) Dissolution account (9) (ii) Partners’ capital accounts (5) (iii) Cash (Bank) account................................................................................................................................................. Source material for question 4 is on pages 8 and 9 of the source booklet................................................................................................................................................

............................................................... ........................................... ............................................................................................................................... .................................................................................................................................................................................................... ........................................................................................................ .............................................................................................................................. ................................................................................................................................................... ........................................... ................................................................................................................................................................................................................................................................................... ............................................................................................................................................................................................................................................................................................................................................................................................. ............... ................................................................. .................................................... ......................................................................................................................... *P38646a02340* 23 Turn over .................................................................................................................................................................................................................................................................................................................................................................................................................................... ..... .......................... ................................. .......................................................................................................................................................................................................................... .................................................. .................................................................................................................................................................................................................................................... ................................................. .................... ........................................................................................................................................................................................................................................................................................Leave blank .............................................. ............. .......................................

............................................................................................................................................................................................................................................................................................................................................ ........................................................................................................................... .......................... .................................................................................................................................................................... ........................... ............................ ................................................................................ ................................................................................................................................................ ......................................................................................................... ......................... (2) (ii) Suggest two possible reasons why Woodman & Co may wish to pay for goodwill when purchasing the business of Marios and Tamsin.......................... ............................................................................................................................................................................................................................................... ......................................................................................................................................... by selling many of the assets to Woodman & Co....................................................................... (2) Marios stated that........................................................... ........................................ ...............................................................................................................................................Leave blank (b) State two reasons why a partnership may be dissolved....................................................................................................................................................... ................................................................................................................................................................ ..................................................................... .................................................... the partnership would be able to realise the goodwill in the business............................................... ...................................... .................................................. (4) 24 *P38646A02440* ..................................................................................................................................................... ............... (c) (i) Explain the term goodwill................................. .....................................................................

............................................................... ................................................................................................................. .................................. ................................................................................................................................................................... ............................................................................................................................................................................................................................................................................ .............................................................................................................................Leave blank (d) Evaluate trading as a partnership as an alternative to trading as a sole trader........... ...................................................................................................................................................................................... ......................................................................... .............................................................................. (4) Q4 (Total 32 marks) *P38646a02540* 25 Turn over ................................................................................ ........................................................................................................................................................................................................................................................................................................... ........... ................................................................ ............................................................................................................................................................................................................................................................................................................................................................................................................................ ...................... .............................................. ........................................................................................................................................................................................................................................................................................................................................ ............................................ ...................................................................................................................................... ................. ........................................................................................................................................................................................................ ...................................................................................................................................................................................................................................................................................................................... ........................................ ................................................................. ..................................... .......................

.................................. ............................................................................................................... put a cross in this box ( )..........................................................Leave blank If you answer question 5............................................................................................................................................ ...................................... 5 (a) Distinguish between stock valuation and stock rotation...................... .............................................................................. ..................................................... ....................................................................... ............................................................................................................................................................................................................................................ (4) 26 *P38646A02640* .................................................................................................................................................... ................................................... ......................................... Source material for question 5 is on pages 10 and 11 of the source booklet... ............................................................................................................................... .............................................................. ............................................................. ...................................................................................................................................................................................................................................................................................................

........................................................................................................................................................................................................................................................ ....................................................................................................................................................................... ........................................................................................................................................................................................................................................................................................................................................................................................................................... ...................................................................................................................Leave blank (b) Calculate the value of the closing inventory (closing stock) at 30 April 2011....................................................................................................................................... ......................... ............................................................................. .............................................................................................................................................................................................................................................................. ........ .................................................................................................. ................................................................................................................................................................................................ ........................................................................................................ .............. ............................... (8) *P38646a02740* 27 Turn over ......................................................................................................... .................................................. .................................................. ................................................................. .............

............................................................................................ ...................................................................................................................................................................... (6) 28 *P38646A02840* .................................................................................................................................................................................................................................................................................................................. (4) (ii) Prepare the statement of comprehensive income (trading and profit & loss account) for the month of April 2011........................................................... ............................. ..................................................................................................................................................................................................................................................................................... ........................................................................................................................................ .......................................................................................................................................................................................... ................................................................................................................................................. ........................ ........................................ ................................................................................................................................................................................................................................................................................. .....................................Leave blank (c) (i) Calculate the Revenue (Sales) for the month of April 2011 ...................................................................... ..................................................................... ........................................................... ............................................... ........................................................................................................................................................................ ................................... .................................................................................................................................................................................................................. .................................................................................... ..................... .......................................................................................................................................................................................... ....................................................................................................................................................................................................... ......................................................

................................................................... ......................................................................... (d) (i) Calculate the cost to Hinal for one month of the • Low Usage tariff • High Usage tariff............................................................................................................................................................................................................................. ................... .......... ............................................................................................................................................................................................................Leave blank Hinal is considering renting a mobile phone from Shavani.................................................. ............................ ...................................................................................................................................................................................................................................................................................... ............................................................................................................. ................................................. ........................................................................................................................... (4) (ii) Advise Hinal whether he should enter into a Low Usage tariff or High Usage tariff agreement............................................................................................................................................................................................................................ (2) *P38646a02940* 29 Turn over ................ ............ ................................. .............................................................................................................................. ................................................................ Hinal estimates that he will use his mobile phone for 75 minutes per month...................................................................................... .........

............................... ............................................................................................................. ........................................................ ............................................................... .................................................................................................................... ............................................................................................................................................................................................................................................I............F.........................Leave blank (e) Evaluate the use of First In First Out (F................................... .................................. .................................................................................. .................................................................................................................................................................................................................O) as a method of valuing inventory (stock)................................................................................................................................................................................................. .................................................................................................................................................................................. .......................... .................................................................................................................................................................................................................. ....... (4) (Total 32 marks) 30 *P38646A03040* Q5 ...

.................................................................................................. ...................................................................................................................................................................................................................... ............................................................................. 6.......................................................... .......... ..................................................................................................................................................... ........ (2) *P38646a03140* 31 Turn over .................................. .............................................. ................................................................................................................................................................................................................................................................................................................................................................. ........ Source material for question 6 is on pages 12 and 13 of the source booklet........................................................................ .... ..................................................................................................................................................................................................................................................................... .................................................................................................................. ......................... (4) (ii) Advise Easy Gardening how to appropriate the business advertising expense between the shop and the workshop....................................................................................................................................... ................................................... ......................................................................................................................................................................................................................................................Leave blank If you answer question 6.................................................................. put a cross in this box ( )....................... (a) (i) Explain the term appropriation of overheads............................................................................................. .................................................................................. .......................................................................................................................................... ............................................................................ .. ................................................................................................................. ...........

........................................ ......................................................................................................................................... ........ ..................................................................................................................... ............................................................................................................................ 32 *P38646A03240* ............................................................................................................................... .............. ......................... .............................................................................. ......................................................................................... .................................................................................................................................................. ....................................................................................................................................................................................................................................... ........................................................................................................................................................................................................................................... .................................................................................................................................................................................................................................................................................................. ............................... ............................... ............................. ..................................................... ......................................................................... ........................................................................................................................................................................ ....................................................................................................... .................................................................................................................... ............................................................................................................................................................................................................................................................................................................. ................................................................................................................................................................................................................................................................................................................................................................................................................................ .............................................................................................................................................................Leave blank (b) Prepare the departmental statement of comprehensive income (departmental trading and profit & loss account) for the year ended 31 March 2011................................. ......................................................................

.......................................................................................................... ........................................................................................................................... (22) *P38646a03340* 33 Turn over ......................................................................................................................................................................................................................................................................................... ...................................................................................... ....................... ............................................................................................................................. ..................................................................................................................................................................................................................................... .............................................................................................................................................. ........................................................................................................................................................................ .................... ............................................................................ .............................................................................................................................................................................................................................................. ................................................................................................ .................................................................................................................................................................................................................................... ......................................................................................................... ................................................................. ................................................................................................... ....................................................................................................................................... ......................... .........................................Leave blank .......................................................................................................................................................... ............................................................ ................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ ........................... .......................................... ................................................ ..........................................................................................................................

........................ ..................Leave blank The owners of Easy Gardening are considering closing the repair workshop and using this as additional space for the shop................................................................................................... ............ ....... ............................................................................... ................................................... ......................................................................................................................................................................................................... (4) (Total 32 marks) 34 *P38646A03440* Q6 ........................................................................................................ .................................................................... ..................................................................................................................................... ........................................................................................................................................... .............................................................................................................................................................................. (c) Evaluate this belief of the owners................................................................... ................................................................................................................................................................................................................... .................................................................................. ............................................................................................ The owners believe that this will increase profits.......................................................................................................................................... .................................................................... ............................................................................................................. .............................................................................................................................................................................................................................................................. ........................................................................................................................................................... ............. ......................................................................................................................................... ........................................................................ ........................................................................................................................................................................................................ ...........................................................................................................................................................................................................................................................................

........... ............................................................................................................................................................................................................. ............................................................. (a) Explain the term suspense account....................................................................................... ........................................................................................................................................................................................................................................................................................................................ Source material for question 7 is on pages 14 and 15 of the source booklet............... .......... ................................... put a cross in this box ( )...................... ................ 7...................................................................................................................................................................................................................................................................................... ................................................... (5) *P38646a03540* 35 Turn over ......................... stating which of the items (i) to (iii) above would require an entry into the suspense account..................................................................................................................................................................................... ...Leave blank If you answer question 7......................... ....... .............

........................................................................... ...... ............................................................................................................................................................Leave blank (b) Calculate the corrected gross profit for the year ended 31 March 2011................. ................................................................ ................................................................................................................................................................................................................................................................................. ................................ ............................................................................................................................................................................ ....................................................... ................................................................................. ..................................................................... .......................................................... ........................................................................................................................................................................................................................................................................................................................ ........................... ............................................................... .............................................................................................................................................................................................................................................................................................................................................................................................................................................. ............................................................................................................................................................................................................................................................................................................................................................................................................... ............................................................. ....................................................................................................................................................... ................................................ .................................. ............................................................... ................................................................................................................................ ......... ...................................................................................................................................................................................................................................................... .................................................................................. (7) 36 *P38646A03640* ...................................................................................................................................

............................... .. .............................................................................................. .................................................................................................................................................................................................................................................................... .......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... .................................................................................................................................. ................................................................................................................................................................................................... .............. .............................................................................................................................................................................................................................................................. (8) *P38646a03740* 37 Turn over ............................................................................................................................................................................................................... .......................................................................................................................................... ....................... ....................................................................................................... .............. ............................................................................... ........................................................ ......................................... Narratives are not required................................................................................................................................................................................................................Leave blank (c) Prepare journal entries to correct the errors in (iv) to (vii) above................ ................................................................................................................... .................................................. ............................................................................................................................................................................................. ...................................................................................................................... ....................................................... ..... ..................................... ................................... ............................................................................................................................................................................................................................................................................

. ................................................................................................Leave blank (d) Show the effect of correcting each of the errors in (iv) to (vii) above on the net profit for the year ended 31 March 2011.......................................................................................................................................................................................................................................................................................... ....................... ....................................................................................................................................................................................................... .......................................................................................................................................................................................................................................................................................................................................................................................... . Where the correction would have no effect on the profit for the year you should state No Effect................ .................................................................................................................................. together with the value of the increase or decrease.................................................................................. ................ ................................................................................................................................................................................. ............................................................................................................................................................................... ................................. ......................................................... ......................................................................................................................................................................................................................................................................................................................................................................................................................................................... .................... ......... .................... Draw up a table and show each item separately........... .............................................................. recording whether the correction would increase or decrease the net profit for the year......................................................................................................... . ............................ (8) 38 *P38646A03840* .................................................................................................................................................................................................................................................. .......................................................................... .............. ....................................................................................................................................................

................................................................................................................................................................................................................................ ........................................................................................................................................................................................ ........................................................................................................................... ............................................................................................................................................................................................................. .......................................................................................................................................... .................Leave blank (e) Evaluate the use of a trial balance as assurance that the Ledger is accurate................... .................. ................................................................. ..... ............................... ....................................................................................................................... ..................................................................... .................................................................................................................................................................................................................................................................. .......................................................................................................................................................................................................................................................................................................................................................... (4) Q7 (Total 32 marks) TOTAL FOR SECTION B: 96 MARKS TOTAL FOR PAPER: 200 MARKS END *P38646a03940* 39 Turn over ................................................................................................................................................................................... ..................................................................................................................................................................... .......................................................................................................................................................................................................................................... . .............................................. .................. .............................. .................................... ................................................................................................................................................................................................................................... .......................................................................................................................................................................................................................

BLANK PAGE 40 *P38646A04040* .

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