Beruflich Dokumente
Kultur Dokumente
Paper 1.1INT
7J–INTIX
Section A
Paper 1.1INT
7J–INTAA
1 A
2 D
3 D
4 D 838,600 + (102,600 – 42,300) – (88,700 – 48,400)
5 C
6 B
7 C
8 A (4 x 10,000) + (8 x 12,000) = 136,000; 1/12 x 144,000 = 12,000
9 A 23,000 – (49,000 – 42,000)
10 C Share capital Share premium
1,000,000 1,400,000
Issue 500,000 900,000
–––––––––– ––––––––––
1,500,000 2,300,000
Bonus 500,000 (500,000)
–––––––––– ––––––––––
2,000,000 1,800,000
–––––––––– ––––––––––
11 C
12 B (960,000 x 20%) + (48,000 x 20% x 1/2) – (84,000 x 20% x 1/4)
13 B
14 B
15 D
16 A
17 D
18 C
19 D
20 D
21 C
22 C X salary 20,000 + interest 10,000 + share 150,000 = 180,000
23 D
24 D
25 B
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Paper 1.1INT
1 (a) Hasta
7J–INTBA
(b) Cash not accounted for: $192,200 – $15,600 – $8,300 – $2,000 – $150 166,150
less: purchases 104,500
————
Drawings 61,650
————
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2 (a) Receivables ledger control account balance
Paper 1.1INT
7J–INTBB
+ –
$ $
Original balance 487,600
(1) Sales day book overcast 2,000
(2) Bad debt written off 8,400
(4) Contras incorrectly entered 32,200
(5) Credit note adjustment 1,100
(6) Discount not recorded 150
————– ———–
488,700 42,750
42,750
————–
Revised balance $445,950
————–
3 Gasta Group
7J–INTBC
Goodwill
$ $
Investment in Erica 1,380,000 Share capital 75% 750,000
Retained earnings 75% 360,000
Retained earnings –
goodwill written off 270,000
————— —————
1,380,000 1,380,000
————— —————
Minority interest
$ $
Balance to CBS 377,500 Share capital 25% 250,000
Retained earnings 25% (WI) 127,500
————— —————
377,500 377,500
————— —————
19
Retained earnings
7J–INTBC
Paper
$ $
Goodwill Balances: Gasta (W1) 1,640,000
75% × $480,000 360,000 Erica (W1) 510,000
Minority interest 127,500
Goodwill impairment
written off 270,000
Balance to CBS 1,392,500
————— —————
2,150,000 2,150,000
————— —————
Working 1
Retained profits: Gasta $2,040,000 – $400,000 = $1,640,000
Erica $660,000 – $150,000 = $510,000
Alternative calculations
Goodwill $ $
Cost of investment 1,380,000
Share of net assets acquired
Share capital 1,000,000
Retained profit 480,000
—————
1,480,000
—————
Group share 75% 1,110,000
—————
Goodwill 270,000
Minority interest
Share capital 1,000,000
Retained earnings 510,000
—————
1,510,000
—————
Minority share 25% 377,500
—————
Retained earnings
Gasta 1,640,000
Erica 510,000
Less: preacquisition 480,000
————
30,000
(i) Heavy spending on non-current assets, depleting cash or increasing overdraft. Such expenditure comes out of current
assets, and will reduce both the current ratio and the quick ratio.
(ii) Write-downs of inventory through obsolescence or fashion changes. This will reduce the current ratio.
(iii) Repayment of long-term loans
(iv) Payment of high dividends
(v) Reduction in receivables as a result of bad debts
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(b) Two from:
Paper 1.1INT
7J–INTBD
$
Project
A17 2,000,000
A20 3,000,000
—————
5,000,000
—————
Balance sheet
Cost Amortisation Net book value
$ $ $
A17 16,000,000 4,000,000 12,000,000
J9 5,500,000 5,500,000
––––––––––– –––––––––– –––––––––––
21,500,000 4,000,000 17,500,000
––––––––––– –––––––––– –––––––––––
(b) The main applicable accounting concepts are accruals and prudence. The accruals concept favours capitalisation of
development expenditure to match the expenditure against the future income to be generated from it. The prudence concept
argues for caution, having regard to the inevitable doubt as to the successful outcome of the development project. The going
concern concept is also relevant, because doubt as to the going concern status of the company would clearly mean that the
capitalisation of development costs could not be justified.
Other concepts considered on their merits.
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Part 1 Examination – Paper 1.1(INT)
Paper 1.1INT
7J–INTMS
Marks
1 (a) Heading 2 x 1/2 1
Sales 1
Gross profit
172,000/2 1
$21,000 – (30,000/2) 2 3
Cost of goods sold
Opening / Closing inventory 2 x 1/2 1
Purchases (balancing figure) 1
—
7
Wages 1/
2
Sundry expenses 11/2
Loss on sale 1
Depreciation 1 4
—
11 max 10
(b) Calculation of cash not accounted for 1
Deduction of cash for purchases 1 2
— —
12
—
3 Heading 2 x 1/2 1
Sundry net assets 1
Share capital 1
Retained earnings 21/2 + 1 for inventory adjustments 31/2
Goodwill 11/2
Minority interest 1
— 9
4 (a) 2x2 4
(b) 2x2 4
— 8
23
Marks
Paper 1.1INT
7J–INTMS
24