| = | PRINT son aame outline tle 2a etary adetit vi ywrsererseet Fale | a one 1939010 ‘oso mey rl nd FORM TP 2022108 MAYAUNE 2022 CARIBBEAN EXAMINATIONS COUNCIL CARIBBEAN SECONDARY EDUCATION CERTIFICATE® EXAMINATION PRINCIPLES OF ACCOUNTS Paper 01 ~ General Proficiency I hour 30 minutes (09 MAY 2022 ( READ THE FOLLOWING INSTRUCTIONS CAREFULLY. os ‘This test consists of 60 items. You will have I hour and 30 minutes to answer them, In addition to this test booklet, you should have an answer sheet. 3. Each item in this test has Four suggested answers lettered (A), (B). (C), (D). Read each tem you ‘are about to answer and decide which choice is best. 4, Onyouranswer sheet. find the number which corresponds to your item and shade the space hay the some letter os the anewer you have chosen. Look atthe sample item below. | Sample Item Prime cost is calculated by adding direct factory expenses tothe Sample Answer g (A) cost of goods sold ®@O©®6 (B) sale of fixed assets (C) sale of finished goods (D) cost of materials used “The bea answer to this item is “cost of materials used”, so (D) has been shaded 5. Ifyou want to change your answer, erase it completely before you fill in your new choice. 6 When you are told to begin, tum the page and work as quickly and as carefully as you can, Ifyou cannot answer an item, go on to the next one. You may return to that item later, “The use of silent, electro alculators is allowed, DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO. /e ‘Copyright © 2021 Ceribbean Examinations Council3 ‘The MAIN intemal users of accounting information are (A) managers (B) competitors ©) local communities (©) government agencies A businessman offers @ discount for Prompt payment for goods purchased. ‘Under which column in his three-column cash book would this discount be entered?" (A) Bank (B) Cash (©) _ Discount allowed (0) -ount received Which of the following BEST des the ‘double entry’ system of accounting? (A) A ledger account must have two sides. (8) Anaccount must be written wwice in the ledger. (©) Exch transtetion must be written in two subsidiary books. (D) Each transaetion must have a debit entry and a ereit entry. During the year a company bought stationery for $220 and used $120 worth of it. What figure would be posted to the income statement to represent the ‘expenditure for stationery? (A) $100 ®) $i20 (c) $220 () $340 01239010/MsICSEC 2022 Which of the following lists of activities shows the correct order of the stages inthe accounting cyele, before final accounts? (A) Posting tolecger,journalizing, trial balance (B) Posting to ledger, trial balance, journalizing (C)—Journatizing, postingto ledger ial balance (D) —Joumatizing, trial balance, posting to ledger Which of the following lists of current assets is arranged in order of liquidity? (A) Accounts receivable, prepayments, inventory, eash, bank (B) Cash, bank, prepayments, aecounts receivable, inventory (©) Prepayments, accounts receivable, cash, bank, inventory (D) Inventory, accounts receivable, prepayments, bank, cash tem refers to the following balances that appeared in the ledger of Mrs G. Dalton 3 Machinery 4.000 Inventory 3.000 Purchases 1000 Sales 5.000 Capital 3.000 What is the TOTAL of the tral balance? (A) $5000 (8) $6000 (©) $7000 (D) $8000 GO ON TO THE NEXT PAGE,8 Item 8 refers (othe following information. On I January 2021, $10 000 was paid towards an advertising eampaign. OF this 57 000 was used by 31 December ‘Whatwasthe amount prepaid foradvertising atthe end of the year? (A) $3000 (B) $7000 (C) $1000 (D) $17 000 tem 9 refers to the following balances at the end of a financial period, 8 Motor vehicles 2000 Payables 3.000 Receivables 2.000 Capital 11 000 Building 10.000 ‘What is the TOTAL amount for the assets? (A) $12.00 (B) $13.00 (C) $14000 (D) $1500 10. i. A businessman boughta new computer for ‘$6 000. He paid $4 000 in cashsnd traded in his old computer. What is the entry to record this transaction?” $2000 $4000 (A) [ Debit old computer Debit eash Creditnew computer (B) | Debit new computer Debit cash Credit old computer (©) | Debit old computer Debit cash Creditneweomputer (D) | Debit new computer Credit old computer Credit cash 36.000 $4 000 32.000 $6,000 ‘$6000 $4000 $2,000 36 000 $2000 $4.00 lem 1 refers to the following table which shows the summarized position of Foster ‘and Seott Limited at 6 March 2021 3 Current lables 50 000 Current assets 100 000 Non-current assets 200 000 Non-current liabilities [150 000 ‘What was the capital of Foster and Scott Limited at 6 March 20212 (a) $ 40.000 (8) $ 90000 (©) 150.000 (D) $190.00 GO ON TO THE NEXT PAGE2 1B. 14 15, Credit notes issued for goods retuned by customer would be FIRST entered in the (A) retums inward book (8) retums outward book (© sales returns and allowances account (0) purchases returns and allowances account Inordertoavoid writingnumerouscheques for small amounts, a firm may set up a (A) bank draft (B) petty cash fund (C) general journal (D) bank standing order The test ratio indicates (A) nel current assets less inventory available to pay current liabilities (B) current assets to pay current liabilities (©) non-currentassetstobe sold to pay current liabilities (BD) amoverdaft that the trader could securetopay hiscurrentlabilities ‘Which of the following accounts is NOT nominal? (A) Furniture (B) Commission {C) Carriage inwards (D) Discount allowed 0123901 0/MNICSEC 2022 16 17. ‘Mem 16 refers tothe followi Bank ale Balance b/d 20.000 | Purchases Sales 15.000 20001 Balance eld? What is the closing balanee of the bank account? (a) $2000 (B) $3000 (©) $5000 (0) $7000 R. Stevens, a petty cashier, receivesa float of $350. He spends $320 and requests that his float be increased (0 $400. If this request is granted, how much will he receive? (A) $320 (B) $350 © $370 (0) $400 GO ON TO THE NEXT PAGE18. em 18 refers tothe following table. Period of Debt [Amount of Accounts | provision for Bal Debts Receivable Over 3 years 36.000 3% of accounis receivable Over 2 years $4.00 2% of accounts receivable Over | year 38.000 1% of accounts receivable What is the TOTAL provision for doubtful debts? (A) $180 (B) $340 (© $400 (D) $500 19. 20. Which of the following items on a statement of Financial position would differ MOST in presentation when comparing the books of a company and the books of a sole trader? (A) Non-current assets (B) Current fiabi (C) Current assets (D) Capital ‘Mr Ram, a shoemaker, bought a motor ‘van for $11 000 cash, In recording t Aransnetion he should (A) Creash: Dr motor van aecount (B) _Dreash: Cr motor van account (©) Creash: Dr purchases account {D) _Dreash: Cr purchases account 21. In Mrs Lowe's ledger, an entry on the debit sce ofthe drawings account and an entry on the credit side of the bankaceount ‘means that (A) Mrs Lowe puts money in the business’ bank account (8) the bank puts money in Mrs Lowe's personal account (C)_ Mrs Lowe withdraws money from the bank for use in the business {D) Mrs Lowe uses money from her business’ bank account for her personal use 22, The ABC Company received a cheque from Mr Murray for $300. How must this transaction be recorded in ABC's books? |. Creditthe cash book $300. M.Credit Mr Murray's account, IML, Debit the bank account. IV, Debit Mr Murray's account (A) Land Il only (B) land 'V only (©) Wand tt only (D) Mand 1V only GO ON TO THE NEXT PAGEAnasset purchasedfor$1 000isdepreciated — 26. at the rate of 10% per annum using the reducing balance method. Whatisthe book value of the asset at the beginning of the third year? (A), $ 800 (B) $ 810 © $ 900 (0) $1190 ltem24referstothe following information. A aleulation to determine gross profit percentage is as follows. 2. $185 530 100 $529800 1 What does the $529 800 represent? (A) Total sales {B) Gross profit (©) Cost of sales (D) Total purchases tem 25 refers tothe following information. ‘Apublic limited company issueda prospects ‘offering the shares desribedin the following table for sale at par vale. No. of its Ordinary [200000 | $2 5% Preference | 10000 | $5 ‘Type of Share Par Value “The issue was fully subseribed. How much capital did the company raise? 28. (A) $ 40000 (B) $4500 $4000, (D) $4500 0123901 0/MIICSEC 2022 {n preparing its final accounts, a business omitted returns inwards. Which of the Following items would be affected by this omission? Net sales II, Net purchases UL Gross profitloss (A) Land only (®) Land tf only (C) Mand Itt only (D) 1, Hand Itt ‘A business receives $5 000 for rent and deposits this amount into its bank account. ow will this transaction be recorded? (A) Debit bank $5 000 Credit rent $5 000 (B) Debit rent$5 000 Credit bank $5 000 (©) Debit eash $5 000 Credit rent $5 000 (D) Debit rent $5 000 Credit expense $5 000 {tem 28 refers to the following information. ‘MrsAlleninvested $20 000 and Mrs Brown, and Mr Cable invested $5 000 each into the samebusiness. Thelosssustainedduringthe yyearwasS! 000. Thepartnershipagreement issilentonthe tem oflosses,although profits tare to be split in the ratio 2:2:1 in favour of Allen, Brown and Cable respectively. How much ofthe loss must be bome by Mr Cable? (A) S140. (8) $200 (Cc) $300 (D) $400 GO ON TO THE NEXT PAGE29, Depreciation in accounting termis can be 31. The following information eles to @ dened os Ue privately managed charity. (A) inerease in value of an asset over 3 time ! 000 (B) money saved to replace a non- ‘Accumulated funds 3 currentasset 1 tanunry 2021 (©) cost of using a non-current asset Operating expenses 7000 for an accounting period Income from barbecue 5000 {D) straight line method or reducing Income from donations 000 balance method used by abusiness Income from garage sale | 3000 | ‘What isthe charity's accumulated fund at ‘tem 30 refers tothe following information. the end of the year? 3 (A) $9000 ! Costofraw material consumed| 7 800 () $11 000 Manufacturing wages 21000 (©) $12.000 Rent and taxes 000 Oo), eR Indirect wages 000 Royalties 200 tem 32 refers to the following balances Machinery depreciation 400 taken from the books of Sherida’s Ltd as General factory expenses 600 ‘at 30 April 2020. j 30. What is the production cost of goods Balances manufactured? 7 | Rent owi 200 | (A) $2900 Cash 3 500 i (®) $3000 i © $3900 Creditors 1200 | ©) $4000 Prepaid insurance | 300 een [Sra 32. What is the working capital of Sherida’s Ltd? (A) $2.00 | (B) $2400 | (© $2600 ©) S80 | GO ON TO THE NEXT PAGE, iiem33 refersto the Follow ining to the fj business. ‘inginformation neial year of a Opening capital ‘Additional capital ‘The amount of drawings is 33. (A) $5000 (B) — $20000 © $3000 (©) $45.00 jf. Peter Smith worked for 44 hours last week. ‘The rates are $3.50 per hour for ¢ 40. ; for 0 40-hour weekand timeanda half forovertime, Wine ‘was his gross income? : (A) $147.00 (B) $154.00 (C) $161.00 (D) $231.00 435. . Acompany’s rent account had an opening debit balance of $2 000. During the year $6 000 was paid for rent. At the end of the year there was a closing debit balance of $1 500 in the account. ‘What was the rent expense recorded for the year? (A). $6,000 (B) $6500 (©) $7500 (Dp) $9500 0123901 0/MJ/CSEC 2022 36. 37. If cash sales were not entered in the * books, this would be an error of fs omission principle © commission (©) complete reversal ‘The following table shows the balances oF the asset accounts of the Bayroe Clb as at 30 June 2021 8 5.400 1825 Furniture 960 Bank and cash 1640 Inventory of refreshments 72 Premises Equipment ‘The club's accumulated fund was (A) Si 640 (8) s4ag7 © $8185 ©) $9397 GO ON TO THE NEXT PAGE38 0. -9- s 39 refer tems 38 and 39 refer to the following table which shows a trader’s.operation at the end of the irading P=! $ Sales s ‘Sales returns | - Inventory a sat 9.850 Purchases returns 762 What is the cost of goods sold? (ay $49 742 (B) $50653 ($51 415 (0) 353103 What is the gross profit? (A) 931.645 (B) $3215 © $34023 (p) $8002 et, ott 2 ee ee MA. Jones paid $250 in cash for repairs to machinery. This transaction was entered in the cash book and posted to the ledger. The double entry involved would be (A) debit cash account credit repairs account (B) debit cash account credit machinery account (©) debit repairs account credit cash account (D) debit A. Jones account credit eash aceount Item 41 refers to the following table. Number | Invoice Price ofltems | Per Unit (9) 100 60 80 100 50 84 15 84 41. Whatis the value of the inventory? (A) $23.100 (B) $23 700 (©) $24 100 (D) $24500 GO ON TO THE NEXT PAGE4B a Me Miguel’s capital on $40 000 and on 31 Decent 000. He withdrew $1 000 in inventor yoo en FY during What is his profit forthe yeara (A) $ 5000 (B) $ 46000 (©) 8125000 ©) $126 000 W,X, Y and Z are partners sha d rin and losses in proportion to ‘here ‘Theeapitl ofeach partners shows ele Partners x < N What would be Z's share of $7200? ee (a) $2400 (B) $1800 © $1200 (D) § 800 Which of the following accounts shows how profits and losses are shered among partners? (A) Current (B) Appropriation (©) Profitand loss (D) Income and expenditure 0123901 0/MJ/CSEC 2022 48, 46, 47. Which ofthe following tems ares of current liabilities? 1. Mortgages I, Accounts payable IIL, Acerued wages (A) Land It only (8) TandItt only (© Mand itl only (©) 1, tand 111 Which of the following entries in a three- column eash book are contra entries? (A) Debit cash, Credit bank (B) Debit cash, Credit cash (©) Credit eash, Credit bank (D) Debit bank, Credit bank K. Khan, a debtor of A and B Enterprises, settles his debt of $120 less a discount of $3 by cheque. How should the double entry be recorded in the books of Aand B Enterprises? (A) | Debit K. Khan $i7 Debit discount received | $ 3 Credit bank $120 (B)| Debit K. Khan Su7 Debit discount allowed | $ 3 Credit bank $120 (©) | Debit bank SIT Debit discount allowed | $ 3 Credit K. Khan $120 (0) | Debit bank SUT Credit discount received | $ 3 $120 GO ON TO THE NEXT PAGE48. 50. 51. ‘According to the Partnership Act, if there is no Deed of Partnership, the amount of profit fo be recsived by EACH partner would be. (A) _ inequal share (B) 5% of net profit (C) 5% on capital invested (D) in proportion to capital invested Ie tem 49 refers tothe following infermation. 5 Inventory at | January 2019 1500 Purchases during the month 1200 Cost of goods sold 1400 49. Whatistheinventoryattheend oflanuary? (A) $ 300 (8) $ 500 © $ 700 (D) $1300 ie a at pap og Rose contributed $7 000 in cash and a motor vehicle worth $3 000 to a partnership. Rose's contribution to the partnership would be recorded inthe joural as a) ®) © @) Debit | Credit 8 s Cash 10.000 Rose's capital 10.000 Rose’s capital 7000 Cash 7.000 Cash 7000 Motor vehicle 3.000 Rose’s capital 10.000 Rose’s capital 10 000 Motor vehicle 3.000 Cash 7.000 When a company declares a di idend of 15%, the dividend warrant of a shareholder ‘owning 1 500 one dollar ordinary shares is (A) (B) sto) @) $ 100 $ 25 $1500 $1515 52. A photocopying machine valued at $5 000 isdepreciated at 0% using thestraight ine ts book value after TWO (A) $4000 (B) $4050 (© $4500 (D) $4980 GO ON TO THE NEXT PAGE‘An increase in the provision 53. An increase in the provision for doubtful (A) addedtosales inthe tradi ingaccount (B) subtracted from sales inthe trading account (©) included as revenue in the and loss account ae (D) included asan expense in the profit and loss account 54. What is the maximum capital a comy i pan can raise from selling sharesto the public? 57 (A) Issued capital (B) —Paid-up capital (©). Authorized capital (D) Subscribed capital 38. 58. Which of the following entries would NOT appear in a cash book? (A) Payment for goods $100 (B) Goods sold on credit. $100 (C) Goods sold for cheque $100 (D) Goods bought forcash $100 59. 56. Which of the following will result ‘when opening inventories of raw materials areaddedtonnetpurchases of rawmaterials? (A) Prime cost (B) Production cost (©) Raw materials used (D) Raw materials available for use 0123901 0/MJ/CSEC 2022 Item 57 refers to the following bauanest 7 taken from the books of Sherida’s 30 April 2022. Balances $ owt 200 can ao Payables 1200 Prepaid insurance 300 Bank overdraft 400 ‘What isthe current ratio of Sherida’s Ltd? Which of the following items is NOT considered a source document for payroll? (A) Clock card (B) Medical certificate (© Attendance register (D) Electronic timecard A standing order of $25 for insurance appears in the debit column of the bank statement. This amount does not appear inthe cash book. How is this item treated in order to update the cash book? (A) Credit the bank account with $25. (B) __ Debit the bank account with $25. (© Add $25 to the bank statement balance. (©) Subtract $25 From the bank statement balance. GO ON TO THE NEXT PAGE,-13- tem 60 refers to the following information J. Baynes Manufacturi 'ynes Manufacturing Account for the Period Ended 31 December 2021 ‘i ; $ $ Inventory of raw materials | January 2021 800 purchases of raw materials during year Tee pa Seeaat p00 lance carried forward ss 5300 Less closing inventory of raw materials 31 December 2021 1400 . 3.960 Productive wages 1300 Fuel and power i; or Lubricants 100 Rent and rates 400 Insurance 200 at 6800 60. What is the cost of the raw materials consumed? (A) $ 800 (8) $1200 (©) $3900 (Dd) $4500 END OF TEST IF YOU FINISH BEFORE TIME IS CALLED, CHECK YOUR WORK ON THIS TEST.