IGCSE Accounting 0452/21 Paper 2 - Eigsr

Cambridge International ExaminationsCambridge International General Certificate of Secondary Education* 9 5 4 9 2 8 7 4 7 8 *0452/21ACCOUNTINGMay/June 2018Paper 21 hour 45 minutesCandidates answer on the Question Paper.No Additional Materials are required.READ THESE INSTRUCTIONS FIRSTWrite your Centre number, candidate number and name on all the work you hand in.Write in dark blue or black pen.You may use an HB pencil for any diagrams or graphs.Do not use staples, paper clips, glue or correction fluid.DO NOT WRITE IN ANY BARCODES.Answer all questions.You may use a calculator.Where layouts are to be completed, you may not need all the lines for your answer.The businesses mentioned in this Question Paper are fictitious.At the end of the examination, fasten all your work securely together.The number of marks is given in brackets [ ] at the end of each question or part question.This document consists of 20 printed pages.DC (RW) 144910/4 UCLES 2018[Turn overwww.egyptigstudentroom.com

21Lydia is a trader. She keeps a full set of accounting records and prepares control accounts at theend of each month.REQUIRED(a) Name the book of prime (original) entry which Lydia would use to obtain the followinginformation when preparing her control accounts.Book of prime (original) entryReturns by credit customersBad debts written off[2]Lydia was able to provide the following information for the month ended 30 April 2018.2018April 1Amount owing by credit customersAmount owing to credit suppliersApril 30 Totals for the monthCash purchasesCredit purchasesReturns to credit suppliersReturns from credit customersCheques received from credit customersDiscount allowedDiscount receivedContra entryCarriage charged by credit supplierMay 1Debit balance in purchases ledgerCredit balance in purchases ledger (b) Select the relevant figures and prepare the purchases ledger control account for the month ofApril 2018.Insert a figure for cheques paid to credit suppliers.Balance the account and bring down the balances on 1 May 2018. UCLES 20180452/21/M/J/18www.egyptigstudentroom.com

3LydiaPurchases ledger control accountDateDetails DateDetails .[9](c) Suggest two reasons for the debit balance in the purchases ledger on 1 May 2018.1 .2 .[2] UCLES 20180452/21/M/J/18www.egyptigstudentroom.com[Turn over

4Lydia is proposing to create and maintain a provision for doubtful debts at 2½% of trade receivablesat the end of each financial year.REQUIRED(d) Explain how maintaining a provision for doubtful debts is an example of the application of theprinciple of prudence.[2]Lydia allows her credit customers a cash discount of 2% if accounts are settled within 30 days.From 1 June 2018 Lydia is proposing to offer a cash discount of 3% if accounts are settled within21 days.REQUIRED(e) Discuss how this proposal could affect Lydia’s:(i)future liquidity.[2](ii)future profit for the year.[2][Total: 19] UCLES 20180452/21/M/J/18www.egyptigstudentroom.com

52On 1 March 2017 Nabil started a business buying and selling office supplies on credit.Nabil opened a business bank account on 1 March 2017 with capital, 155 000 and a loan fromAB Loans, 80 000. On the same day he purchased premises, 200 000, fixtures and fittings, 22 000, and inventory, 5500, paying by cheque.REQUIRED(a) Prepare a journal entry to include all the above information to open the books of the businesson 1 March 2017.A narrative is required.NabilJournalDate2017DetailsDebit Credit .[5](b) Name two uses of the general journal, apart from opening entries.1 .2 .[2] UCLES 20180452/21/M/J/18www.egyptigstudentroom.com[Turn over

6Despite having little knowledge of book-keeping, Nabil decided to prepare a trial balance at theend of his financial year on 28 February 2018.The trial balance he prepared, which contains errors, was as follows.Debit RevenuePurchasesCapitalLoan – AB LoansPremisesFixtures and fittingsTrade receivablesTrade payablesBank overdraftWagesGeneral expensesInventory 1 March 201728 February 2018Difference on trial balance72 000200 00022 0007 6003 95032 30025 4005 5006 100374 850Credit 119 100155 00080 0006 85013 900374 850The following errors were later discovered.1Nabil’s cash drawings, 10 000, had been posted to the wages account.2No entry had been made for purchases returns, 150.3 140 owed by a credit customer should have been written off as a bad debt.4No entry had been made for bank charges, 210.5The balance of the petty cash book, 100, had been omitted from the trial balance. UCLES 20180452/21/M/J/18www.egyptigstudentroom.com

7REQUIRED(c) Prepare a corrected trial balance at 28 February 2018.NabilCorrected Trial Balance at 28 February 2018Debit Credit Revenue.Purchases.Capital.Loan – AB Loans.Premises.Fixtures and fittings.Trade receivables.Trade payables.Bank overdraft.Wages.General expenses.Inventory .[13][Total: 20] UCLES 20180452/21/M/J/18www.egyptigstudentroom.com[Turn over

83Masuma owns a furniture store. She maintains a full set of accounting records. Her financial yearends on 31 March.Masuma provided the following information at 31 March 2018.1On 1 April 2017 Amina, a credit customer, owed 160. On 1 March 2018 she paid 75% of thisand the balance was written off as a bad debt.2On 4 January 2018 additional fixtures and fittings, 2000, were purchased on credit fromOffice Traders, but this transaction was not recorded.3The fixtures and fittings are depreciated at the rate of 20% per annum on the cost of equipmentheld at the end of each financial year.4On 31 March 2018 the discount columns in the cash book showed the following totals for themonth:discount column on debit side 55discount column on credit side 68These totals had not been transferred to the discount accounts in the ledger.REQUIRED(a) Record this information in the following accounts in Masuma’s ledger at 31 March 2018.Some entries have already been made in the accounts during the year.Close all the accounts by balancing or by making a transfer to an appropriate account.MasumaAmina accountDate2017Details DateDetails 160.April 1Balance b/d. UCLES 20180452/21/M/J/18www.egyptigstudentroom.com

9Bad debts accountDate2018Details DateDetails 135.Feb 28Total written off.Fixtures and fittings accountDate2017Details DateDetails 4000.April 1Balance b/d.Provision for depreciation of fixtures and fittings accountDateDetails Date2017.April 1Balance b/d. UCLES m 1600[Turn over

10Discount allowed accountDate2018Details DateDetails 3590.Feb 28Total to date.Discount received accountDateDetails Date2018.Feb 28Total to date.Details 4130[12]The following account appeared in Masuma’s ledger on 31 March 2018.Disposal of motor vehicle accountDate2018Feb 1DetailsMotor vehicles 95009500 UCLES 2018Date2018Feb 1Mar 310452/21/M/J/18DetailsProvision fordepreciation ofmotor vehiclesM6VansIncome statementwww.egyptigstudentroom.com 4636350013649500

11REQUIRED(b) Explain each entry in the disposal of motor vehicle account.Name the account in which the double entry would be made for each item.State whether that account would be debited or credited.February 1 Motor vehiclesExplanation .Double entry .February 1 Provision for depreciation of motor vehiclesExplanation .Double entry .February 1 M6VansExplanation .Double entry .March 31 Income statementExplanation .Double entry .[8][Total: 20] UCLES 20180452/21/M/J/18www.egyptigstudentroom.com[Turn over

124Asim has an advertising agency. His financial year ends on 31 January.He provided the following information on 31 January 2018.Capital at 1 February 2017DrawingsOffice equipment at valuation at 1 February 2017Motor vehicle at costProvision for depreciation of motor vehicleFees received from clientsWages of assistantGeneral expensesMotor expensesRates and insuranceRent received from tenant 120 0008 5006 18015 0005 40028 35019 0001 3589702 2805 600Additional information1At 31 January 2018 2400 was outstanding from clients for fees.Motor expenses outstanding amounted to 110.A provision for doubtful debts of 2% of the amount owed by clients should be created.2The rates and insurance paid were for a period of 15 months from 1 February 2017.3Part of the premises were let to a tenant on 1 February 2017 at an annual rent of 4800.4One quarter of the motor expenses are for Asim’s personal use of the motor vehicle.5The motor vehicle is to be depreciated at 20% per annum using the reducing (diminishing)balance method.6The office equipment was valued at 5500 on 31 January 2018

ACCOUNTING 0452/21 Paper 2 May/June 2018 1 hour 45 minutes Candidates answer on the Question Paper. No Additional Materials are required. READ THESE INSTRUCTIONS FIRST Write your Centre number, candidate number and name on all the work you hand in. Write in dark blue or black pen. You may use an HB pencil for any diagrams or graphs. Do not use staples, paper clips, glue or correction fluid. DO .