Accounting (0452) · Oct/Nov 2021 · Question paper 22
Cambridge Accounting (0452) question paper for paper 22, Oct/Nov 2021 — 0452/22/O/N/21, file 0452_w21_qp_22.pdf.
Text of this paper
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Cambridge IGCSE™
* 2 1 0 6 2 7 3 8 4 0 *
ACCOUNTING
0452/22
Paper 2 Structured Written Paper
October/November 2021
1 hour 45 minutes
You must answer on the question paper.
No additional materials are needed.
INSTRUCTIONS
●
Answer all questions.
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Use a black or dark blue pen. You may use an HB pencil for any diagrams or graphs.
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Write your name, centre number and candidate number in the boxes at the top of the page.
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Write your answer to each question in the space provided.
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Do not use an erasable pen or correction fluid.
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Do not write on any bar codes.
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You may use a calculator.
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International accounting terms and formats should be used as appropriate.
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You should show your workings.
INFORMATION
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The total mark for this paper is 100.
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The number of marks for each question or part question is shown in brackets [ ].
●
Where you are asked to complete a layout, you may not need all the lines for your answer.
This document has 20 pages. Any blank pages are indicated.
DC (DH) 203495/3
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Ayesha is a trader who maintains a full set of accounting records and prepares control accounts at
the end of each month.
She provided the following information for the month of August 2021.
On 1 August
Sales ledger control account debit balance
Sales ledger control account credit balance
Purchases ledger control account credit balance
Totals for the month
Credit sales
Credit purchases
Cash purchases
Receipts from customers
Payments to credit suppliers
Discount received
Discount allowed
Irrecoverable debt written off
Provision for doubtful debts
Sales returns
Interest charged to customer on overdue account
Contra between sales ledger and purchases ledger
$
9 800
420
7 700
88 850
55 400
1 860
82 100
50 600
600
900
300
450
2 400
90
2 920
The sales ledger control account credit balance brought down on 1 September 2021 was $350.
REQUIRED
(a) Prepare the sales ledger control account and the purchases ledger control account for August
2021.
Balance the accounts and bring down the balances on 1 September 2021.
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Ayesha
Sales ledger control account
Date
2021
Details
$
Date
2021
Details
$
Purchases ledger control account
Date
2021
Details
$
Date
2021
Details
$
[14]
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(b) Name the book of prime entry which Ayesha would use to obtain the following information
when preparing her sales ledger control account.
Item
Book of prime entry
Returns
Discount allowed
Interest charged to customer on overdue
account
Contra entry
[4]
(c) Suggest two reasons why the sales ledger control account had a credit balance of $420 on
1 August 2021.
1
2
[2]
[Total: 20]
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Jabir owns an electrical wholesale business.
The following balances appeared in his books on 30 September 2021.
Inventory
Purchases
Trade payables
Revenue
Trade receivables
Operating expenses
$
8 000
109 000
11 600
160 000
22 600
35 200
The inventory on 1 October 2020 was $11 000.
All sales and purchases were on a credit basis.
REQUIRED
(a) Calculate the gross profit and profit for the year.
[2]
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(b) (i)
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Calculate the gross margin.
[2]
(ii)
Advise Jabir on two actions he could take to improve his gross margin.
1
2
[2]
(c) Calculate the trade receivables turnover. Round up your answer to the next whole day.
[2]
Jabir wants to increase his credit sales and is considering allowing his credit customers an extra
14 days above his current trade receivables turnover.
REQUIRED
(d) Advise Jabir whether he should allow his credit customers an extra 14 days above his current
trade receivables turnover. Justify your answer.
[5]
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(e) Calculate the trade payables turnover. Round up your answer to the next whole day.
[2]
Jabir’s credit suppliers are prepared to double the rate of his trade discount provided he increases
his current monthly purchases by 20%.
REQUIRED
(f)
Advise Jabir whether he should increase his current monthly purchases by 20% to earn the
additional trade discount. Justify your answer.
[5]
[Total: 20]
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On 31 July 2021 the following information was provided by KA Limited, a manufacturer of garden
tools.
Inventory 1 August 2020
Raw materials
Work in progress
Finished goods
Purchases
Raw materials
Finished goods
Carriage on purchases
Raw materials
Finished goods
Direct wages
Indirect factory wages
Factory machinery at cost
Provision for depreciation of factory machinery
Factory general overheads
Rates
Inventory 31 July 2021
Raw materials
Work in progress
Finished goods
Revenue
$
5 820
1 750
12 360
34 200
3 900
410
80
67 200
24 000
47 000
11 000
16 400
5 300
6 030
2 780
10 340
223 000
Additional information
1
On 31 July 2021 rates, $500, were prepaid.
Rates are to be apportioned 75% factory, 25% office.
2
On 31 July 2021 factory general overheads, $230, were accrued.
3
Factory machinery is to be depreciated at 20% per annum using the reducing balance
method.
REQUIRED
(a) Prepare the manufacturing account of KA Limited for the year ended 31 July 2021.
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KA Limited
Manufacturing Account for the year ended 31 July 2021
$
$
[10]
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(b) Prepare the income statement (trading section) of KA Limited for the year ended 31 July 2021.
KA Limited
Income Statement (Trading section) for the year ended 31 July 2021
$
$
[4]
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DH Limited, a customer of KA Limited, has been declared bankrupt. A debt of $350 was owing to
KA Limited. This is to be written off.
REQUIRED
(c) Prepare the journal entry to record the irrecoverable debt. A narrative is not required.
KA Limited
Journal
Details
Debit
$
Credit
$
[2]
KA Limited maintains a provision for doubtful debts.
REQUIRED
(d) Explain how maintaining a provision for doubtful debts is an application of each of the
following accounting principles.
(i)
Matching
[2]
(ii)
Prudence
[2]
[Total: 20]
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Nikita is a trader. The totals of her trial balance at 30 June 2021 did not agree. The debits exceeded
the credits by $2600. Nikita opened up a suspense account.
The following errors were later discovered.
1
Insurance of $2500 had been entered as $4500 in the insurance account. The correct entry
had been made in the cash book.
2
The total of the discount received column in the cash book of $500 had been debited to the
discount allowed account in the general ledger.
3
Credit sales of $1400 to Kajal had been correctly entered in the sales account, but debited as
$1000 in Kajal’s account.
4
A cheque of $700 received from Anisah had been correctly entered in the cash book, but
credited to Aisha’s account.
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REQUIRED
(a) Prepare journal entries to correct errors 1 to 4. Narratives are not required.
Nikita
Journal
Error
number
Details
Debit
$
Credit
$
[10]
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(b) Prepare the suspense account. Start with the difference on the trial balance.
Nikita
Suspense account
Date
Details
$
Date
Details
$
[5]
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(c) Complete the statement to show the effect on the profit for the year of correcting errors
1 to 4.
Where the error does not affect profit write ‘no effect’. Calculate the corrected profit for the
year.
Nikita
Statement of corrected profit for the year ended 30 June 2021
$
28 000
Profit for the year before corrections
Increase
in profit
$
Decrease
in profit
$
Error 1
Error 2
Error 3
Error 4
Corrected profit for the year
[5]
[Total: 20]
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5
Simon has a business selling office stationery. On 1 January 2019 he owned two delivery vehicles
which had been purchased on 1 January 2018.
Delivery vehicle A had cost $30 000 and delivery vehicle B had cost $25 000.
Simon uses the straight-line method for depreciating the delivery vehicles. A rate of 20% per
annum on cost is used, with the rate being applied for each part of the year for which the delivery
vehicles are owned.
Due to a decline in business, delivery vehicle B was sold on 31 March 2020 and a cheque for
$10 350 was received. Delivery vehicle A was still in use at the end of 2020.
REQUIRED
(a) Complete the following accounts for each of the years ended 31 December 2019 and 2020.
Balance the accounts at the end of each year where appropriate.
Simon
Delivery vehicles account
Date
2019
Jan 1
$
Date
Details
$
Balance b/d
55 000
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Provision for depreciation of delivery vehicles account
Date
Details
$
Date
2019
Jan 1
Balance b/d
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Details
$
11 000
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Delivery vehicles disposal account
Date
Details
$
Date
Details
$
[15]
Simon’s sister Yasmin is also in business and depreciates her delivery vehicles by the reducing
balance method.
Simon is considering whether to apply the reducing balance method of depreciation to his delivery
vehicles.
REQUIRED
(b) Advise Simon whether he should apply the reducing balance method of depreciation. Justify
your answer.
[5]
[Total: 20]
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