Accounting (0452) · Oct/Nov 2017 · Mark scheme 12

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Cambridge Assessment International Education
Cambridge International General Certificate of Secondary Education

ACCOUNTING

0452/12

Paper 1

October/November 2017

MARK SCHEME
Maximum Mark: 120

Published

This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of the
examination. It shows the basis on which Examiners were instructed to award marks. It does not indicate the
details of the discussions that took place at an Examiners’ meeting before marking began, which would have
considered the acceptability of alternative answers.
Mark schemes should be read in conjunction with the question paper and the Principal Examiner Report for
Teachers.
Cambridge International will not enter into discussions about these mark schemes.
Cambridge International is publishing the mark schemes for the October/November 2017 series for most
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This document consists of 7 printed pages.
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0452/12

Cambridge IGCSE – Mark Scheme
PUBLISHED

Question

October/November
www.dynamicpapers.com
2017

Answer

Marks

1(a)

C

1

1(b)

D

1

1(c)

A

1

1(d)

A

1

1(e)

A

1

1(f)

B

1

1(g)

A

1

1(h)

C

1

1(i)

D

1

1(j)

B

1

Question
2(a)

Answer

Marks

duality (1)

1

2(b)

True or False
Carriage inwards appears on the debit side of a trial balance.

True (1)

Inventory is included in current assets.

True (1)

A suspense account represents the difference between the
cash book balance and the balance on the bank statement.

False (1)

A sole trader enjoys limited liability.

False (1)

The sales account appears in the nominal/general ledger.

True (1)

5

2(c)

An adjustment for a prepayment reduces expenses and increases profit. (1)

1

2(d)

To monitor progress
To prepare financial statements
For decision making
Any one reason for (1) mark

1

2(e)

term

organisation

prime cost

manufacturing business

accumulated fund

club/society (1)

dividend
interest on capital

partnership (1)

work in progress

manufacturing business (1)

drawings

© UCLES 2017

limited company (1)

sole trader (1) OR partnership (1)

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5

0452/12

Cambridge IGCSE – Mark Scheme
PUBLISHED

Question

October/November
www.dynamicpapers.com
2017

Answer

Marks

2(f)

In the income statement (1) as an addition to gross profit / as an item of income/credit (1)

2

2(g)

An income statement deals with revenues and costs, (1) whilst a statement of financial
position deals with assets and liabilities. (1)
OR
An income statement covers a period of time, (1) whilst a statement of financial position is
for a specified date. (1)

2

2(h)

Trade payable
Club member
Committee member
Bank
Accept other valid answers
Any one for (1) mark

1

2(i)

Historic cost
Difficulties of definition
Non-financial aspects
Any one for (1) mark

1

Question
3(a)

Answer
To reduce the number of entries in the ledger
To allow book-keeping duties to be shared
As an aid for posting to the ledger
To summarise accounting information
To help in the preparation of control accounts
To group together similar types of transactions
To make it easier to check for errors

Marks
1

Accept other valid answers.
Any one for (1) mark
3(b)

Cash book (1)

3(c)

© UCLES 2017

1

Date

Source document

Issued by

May 2

invoice (1)

Asnee (1)

May 4

credit note (1)

Asnee (1)

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4

0452/12

Cambridge IGCSE – Mark Scheme
PUBLISHED

Question

October/November
www.dynamicpapers.com
2017

Answer

3(d)
2017
May 1 Balance b/d
31 Total for month

2017
May 31 Income
statement

3(e)
2017
May 4
6
6
31

Purchases returns
Bank
Discount received
Balance c/d

Marks

Jason
Purchases account
$
2017
19 620
May Income
(1)
31 statement
2 105
(1)
21 725

6
$
21 725
21 725

Purchases returns account
$
2017
1010 (1)OF
May Balance b/d
1
31 Total for month
1010
Asnee account
$
2017
105 (1)
May 1
468 (1)
2
12 (1)
19
485
1 070
Jun 1

(1)OF

$
850
160
1 010

(1)
(1)
7

$
Balance b/d
Purchases
Purchases

480 (1)
400 }
190 {(1)

Balance b/d

1 070
485 (1)OF

+1 for dates
3(f)

A list of account balances (1) at a specific date. (1)

2

3(g)

Any two of:
Omission (1) transaction totally omitted from the books. (1)
Commission (1) transaction posted to wrong account of right class. (1)
Principle (1) transaction posted to account of wrong class. (1)
Original entry (1) transaction incorrectly recorded in book of prime entry. (1)
Reversal (1) debit entry posted on credit side and vice versa. (1)
Compensating (1) errors cancel one another out. (1)

4

3(h)

By comparing control account totals to the totals of balances of the sales and purchases
ledgers, (1) Jason might be able to locate the error. (1)

2

© UCLES 2017

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0452/12

Cambridge IGCSE – Mark Scheme
PUBLISHED

Question

Answer

4(a)
2015
Dec 31

Income
statement
Balance c/d

2016
Dec 31

Balance c/d

+1 for dates
4(b)

FTA Industries
Provision for doubtful debts account
$
2015
Jan 1
Balance b/d
787 (1)OF
1 376 (1)
2 163
2016
Jan 1
Balance b/d
1 638 (1)
Dec 31
Income
statement
1 638
2017
Jan 1
Balance b/d

8
$
2 163 (1)
2 163
1 376 (1)OF
262 (1)OF
1 638
1 638 (1)OF
2

Account debited

2

Account credited

Bad debts

(1) Eddie

(1)

General journal (1)

4(e)

4(f)

Marks

Increase (1) OF of $787 (1)OF

4(c)

4(d)

October/November
www.dynamicpapers.com
2017

1

FTA Industries
Income Statement (extract) for the year ended 31 December 2016
$
Expenses (1)
Bad debts
1 400 (1)
Increase in provision for
doubtful debts
262 (1)OF
Accruals/matching (1)
Prudence (1)

2

Question

Answer

5(a)

Marks
$

Receipts
Share issue (opening balance)
Trade receivables

$
500 000
290 000
790 000

Payments
Non-current assets (400+20+35)
Trade payables
Wages and other expenses

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3

Page 5 of 7

455 000
193 000
80 000

728 000
62 000

6
(1)
(1)
(1)
(1)
(1)
(1)OF

0452/12

Cambridge IGCSE – Mark Scheme
PUBLISHED

Question

October/November
www.dynamicpapers.com
2017

Answer

5(b)

Marks

HS Limited
Income Statement for the year ended 31 December 2016
$
$
Revenue 290 (1) + 20 (1)
310 000
Purchases 193 (1) + 25 (1)
218 000
Inventory at 31 December 2016
21 000
Cost of sales
197 000
Gross profit
113 000
Wages and other expenses 80(1)–10(1)
70 000
Depreciation – buildings
2 000
– vehicles
5 000
– fixtures and fittings
3 500
80 500
Profit for the year
32 500

5(c)

12

(1)
(1)OF
(1)
(1)
(1)
(1)OF

HS Limited
Statement of Financial Position at 31 December 2016

9

Non-current assets
Premises
Vehicle
Fixtures and fittings

Cost
$
400 000
20 000
35 000
455 000

Current assets
Inventory
Trade receivables
Other receivables
Bank

Acc dep
$
2 000
5 000
3 500
10 500

NBV
$
398 000 (1)OF
15 000 (1)OF
31 500 (1)OF
444 500
21 000 }(1)
20 000 }
10 000 (1)
62 000
(1)OF
113 000

Total assets

557 500

Equity
1 000 000 ordinary shares of $0.50
Retained earnings
Current liabilities
Trade payables
Total liabilities

500 000
32 500
532 500

(1)
(1)OF

25 000

(1)

557 500

Accept alternative format
5(d)

In statement of changes in equity (1)

© UCLES 2017

1

Page 6 of 7

0452/12

Cambridge IGCSE – Mark Scheme
PUBLISHED

Question
5(e)

October/November
www.dynamicpapers.com
2017

Answer

Marks

Percentage of gross profit to revenue:

2

Lower selling prices
Undercutting competitors
Use of promotional pricing/trade discount to enter market
Higher purchase prices
Lack of trade discount on purchases
Any one for (1) mark
Percentage of profit to revenue:
Better control of expenses (1)

Question

Answer

Marks

6(a)

Current assets minus current liabilities (1)

1

6(b)

5600 : 4400 (1) = 1.27 : 1 (1)OF

2

6(c)

Quick ratio/acid test/liquid ratio
Trade receivables collection period
Trade payables payment period
(Rate of) inventory turnover
Any one for (1) mark

1

6(d)

He may not be able to meet liabilities as they fall due.
He may not be able to pay day to day running expenses.
He may not be able to take advantage of discounts.
He has a lot of cash tied up in inventory.
Inventory makes up more than half of his current assets.
His trade payables are greater than his trade receivables.
He has a bank overdraft.

4

Each basic statement (1) plus development (1) to max 4
6(e)

6
working capital

owner’s capital

1

introduced $2000 capital in the
form of cash

increase $2000

increase $2000

2

received a long term loan, $500

increase $500 (1)

no effect (1)

3

bought inventory, $400, on credit

no effect (1)

no effect (1)

4

sold goods costing $100 for $180
cash

increase $80 (1)

increase $80 (1)

6(f)

1 – capital intro (1), or 2 – loan (1)

1

6(g)

To know the return earned on total funds used in the business. (1)
Or to compare with other businesses. (1)

1

© UCLES 2017

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