A-AS Level (CIE) Accounting Paper-2: Specimen Questions with Answers 1 - 2 of 53

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Question 1

Write in Short

Short Answer▾

Following are the financial statements of Kyoor ltd.

Following Are the Financial Statements of Kyoor Ltd
Net Sales

Less: cost of sales

Gross Profit

Less: Operating Expenses

Net profit

Cash and Bank Balance

Debtors

Stock

Prepaid Expenses

Fixed Assets

Creditors

Bills payable

Mortgage loan

Equity share capital

Reserve and surplus

1992

1,82, 500

1,42, 500

40,000

25,000

15,000

5,000

30,000

50,000

5,000

2,10, 000

3,00, 000

40,000

10,000

70,000

1,50, 000

30,000

Calculate the following ratios:

  • Current ratio
  • Acid test ratio
  • Debtors turnover ratio
  • State the significance of debtors turnover ratio

Explanation

Question 2

Describe in Detail

Essay▾

The following balances have been extracted from the books of Jennings Company Limited as at 31st December, 2018.

The Following Balances Have Been Extracted from the Books of Jennings Company Limited as at 31st December, 2018
Machinery

Land and Building

Depreciation on Machinery

Purchases (adjusted)

Closing Stock

Wages

Sales

Salaries

Bank overdraft

10 % Debentures (issued on 1.1. 04)

Equity share capital-2000 shares of $ 100 each-fully paid

Preference share capital-1000,6 % shares of $ 100 each- fully paid.

Dr.

1,60, 000

6,74, 000

16,000

4,00, 000

1,50, 000

1,20, 000

80,000

Cr.

10,00, 000

2,00, 000

1,00, 000

2,00, 000

1,00, 000

16,00, 00016,00, 000

The board of directors of the Jennings Company Limited has decided to make the following appropriations:

  • To declare equity dividend on paid-up capital
  • To pay dividend on the preference share capital in full
  • To transfer $ 2,00, 000 to general reserve

Prepare the Profit and loss account for the year ended 31st December, 2018.

Explanation

Profit and Loss Account for the Year Ended 31st December, 2018

Profit and Loss Account for the Year Ended 31st December, 2018
To Purchases

To Wages

To Gross Profit c/d

To Depreciation

To Salaries

To Debenture interest outstanding

To Net Profit c/d

$

4,00, 000

1,20, 000

4,80, 000

10,00, 000

16,000

80,000

10,000

3,74, 000

4,80, 000

By sales

By Gross Profit b/d

$

10,00, 000

10,00, 000

4,80, 000

4,80, 000

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