Horizon College International

Second Term Examination, March 2023

Surname First Names

Subject Paper code/ Unit code

Accounting 4AC01/01

Total marks for Paper Duration Class

100 Two hours Year 10

Instructions
 Use black ball-point pen.
 Write your Surname, First Name and the Class in the space given clearly.
 Check the total number of pages in the Paper.
 Read each question carefully before you start to answer it
 Write your answers neatly in good English.
 Keep an eye on the time. Marks Marks
Question/Section
 Check your answers if you have time at the Allotted Obtained
end.
Section ꓮ 1-10 10
Information
Section ꓮ -11 5
 The total mark for this paper is 100.
 The total number of pages in this paper is 15 Section ꓮ -12 5
 Answer all questions. Section ꓮ -13 5
 The marks for each question are shown in Section B-14 15
brackets
Section B-15 15
Section B-16 15
Section B-17 15
Section B-18 15

Total 100
Percentage %
Grade
Second Term Examination, March 2023 Year 10 Accounting 4C01/01

SECTION A
Answer ALL questions in this section. Write your answers in the spaces provided.

Questions 1-10 must be answered with a cross in a box. If you change your mind about an
answer, put a line through the box and then mark your new answer with a cross.

1. A business buys goods for cash. What are the entries in the books of the purchaser?
(1 mark)
Account to be debited Account to be credited
 Cash Supplier
 Cash Purchases
 Purchases Cash
 Supplier Cash

2. Where would the purchase of a motor vehicle on credit be recorded? (1 mark)

 Cash book
 Journal
 Petty cash book
 Purchases day book

3. In which book of original entry will credit notes received be recorded? (1mark)
 Purchases book
 Purchases return book
 Sales book
 Sales returns book

4. What is the main purpose of providing for depreciation on non-current assets? (1mark)
 To provide funds for the replacement of the asset
 To show the market value of the asset
 To show when the asset should be replaced
 To spread the cost of the asset over its useful life

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

5. A cash book has a discounts column on the credit side. Where is the total of this column
posted?
(1 mark)
 Credit discount allowed account
 Credit discount received account
 Debit discount allowed account
 Debit discount received account

6. A business keeps a petty cash book with a float of $200. During the month the total
expenses paid from petty cash were $160. What amount was required to restore the
float? (1 mark)
 $40
 $160
 $200
 $360

7. In which book of original entry should the correction of an error be made? (1 mark)
 Cash book
 Journal
 Purchases day book
 Purchases returns day book

8. Which statement is incorrect? (1 mark)

 Assets = liabilities + capital
 Capital = assets − liabilities
 Capital − liabilities = assets
 Liabilities = assets − capital

9. The skills and knowledge of a workforce is not shown as an asset in the financial statements.
Which accounting concept is being applied? (1 mark)
 Business entity
 Consistency
 Materiality

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

 Money measurement

10. Identify which statement is correct. A bank reconciliation statement is: (1 mark)
 a record of bank charges
 part of the double entry
 prepared by the bank
 prepared by the trader

Question 11

Complete the following document.

……………………………………………….Note

PR Supplies

12 High Street

London

Baines 14

Stopes Road

Birmingham B15 No. 111

Date 12 February 2022

Quantity Code Description Unit price (£) Total (£)

24 LKJ Mobile phones 75 …………………
Trade Discount 10% …………………..
Subtotal …………………..
Goods damaged

(5marks)

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

Question 12

Complete the table, using a tick (√), to indicate how each item would be classified when a new motor vehicle
is purchased.

Item Capital expenditure Revenue expenditure

Vehicle cost

Delivery cost

Insurance

Additional shelving

Fuel

(5marks)

Question 13

On 31 March 2019 Ehab sold machinery for $16 000. The machinery had been purchased on 1 November
2016 for $24 000. He depreciates machinery at 20% per annum using the reducing balance method. A full
year’s depreciation is charged in the year of purchase but none in the year of disposal. Ehab’s financial year
end is 31 March. Prepare the disposal account.

Date Details $ Date Details $

(5marks)

[Total marks for the section A=25]

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

Section B

Answer ALL questions in this section. Write your answers in the spaces provided.

Question 14

1. State two reasons why a business maintains a petty cash book. (2 marks)
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2. Brim maintains a petty cash book with a float of $120. The following transactions took place
in March 2022.
March 2022 Voucher number Transaction $
3 2360 Purchased postage 21.60
stamps
9 2361 Purchased stationery 32.30
18 2362 Paid travel expenses 9.20
22 2363 Paid office cleaner 20.00
29 2364 Paid taxi fare 15.00
31 Restored the petty cash float To be calculated

Prepare the petty cash book for the month ended 31 March 2022. Balance the petty cash book on
this date and bring the balance down on 1 April 2022. (11)

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

Petty cash book

Receipt Date Details Vo : No Total stationery Cleaning Postage Travel
Expenses

(Total marks for the question 14 = 15 marks)

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

Question 15

Ashly owns a business selling computer accessories. He operates a full double entry system of book-
keeping.
(a) Complete the table below to show the business document and the book of original entry for
each transaction. (6 marks)

Transaction Business document Book of original entry

Purchase sales goods on credit
basis
Selling sales goods on credit
basis
Paid cash for stationery

(b) The following transactions occurred during the month of August 2022.

Date Transactions

01-08-2022 Opening balance cash £2,000 ,Bank £200

05-08-2022 Sold goods and received £ 2700 deducting cash discount 10%

09-08-2022 Paid salary for the staff £1,000

15-08-2022 Paid for suppliers £1,900 deducting cash discount 5%

23-08-2022 Gave the petty cashier £ 1,000

24-08-2022 Cash sales £1,250

28-08-2022 Bank charges £100

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

Cash book

Date Detail Discount cash Bank Date Detail Discount Cash Bank

(Total marks for the question 15 = 15 marks)

Question 16

(a) Explain the limitations of the trial balance. (3 marks)

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

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(b) Following are the balances of accounts of Mohara's business as at 30.06.2022.

Cash 40 000
Purchases 150 000
Sales 365 000
Trade receivables 35 000
Trade payables 24 000
Insurance charges 6 000
Furniture 20 000
Discounts received 8 000
Discounts allowed 4 000
Motor vehicles 400 000
Rent payments 30 000
Stationery expenses 5 000
12 % Investments 50 000
Investment income 3 000
5 % Bank loan 90 000
Capital 250 000

Prepare the trial balance as at 30st June 2022. (12 marks)

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

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(Total marks for the question 16 = 15 marks)

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

Question 17
1. (a) Complete the table below by placing a cross (×) to Indicate whether the following
items would be entered on debit side or credit of a cash book. (10 marks)
Debit side Credit side
Cash sales
Interest on overdraft
Cash Purchases
Bank charges
Salary payment
Rent income
Received from Trade
Receivables
Rent payment
Standing order
Payment to trade payables

(b) Following details for the year ended 31st December 2022.
01-Januaruary – 2022 allowance for irrecoverable debts £ 500
31- December – 2022 Trade receivables £ 15,000
Allowance for irrecoverable debt percentage – 5%
Prepare the following account, clearly showing the transfers to income statement as at
31st December 2022. (5marks)

Allowance for irrecoverable debts

Date Details £ Date Details £

(Total marks for the question 17 = 15 marks)

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

Question 18

11. (a) State the possible reasons for the difference between the bank account balance and
the balance of the bank statement. (2 marks)
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Following are extracted from the bank account of Chris business and the bank statement
received from the bank as at 31.07.2022

Cash book
Date Details £ Date Details £
01-07-2022 Balance b/f 16,000 04-07-2022 Salaries 8,500
06-07-2022 Cash 20,000 09-07-2022 Trade payables 17,500
12-07-2022 Cheque deposit 14,000 18-07-2022 Rent 9,000
24-07-2022 Cheque Deposit 15,000 26-07-2022 Purchases 12,000
29-07-2022 Cheque deposit 18,000 27-07-2022 Trade payables 17,000
31-07-2022 Balance c/d 19,000
83,000 83,000
01-08-2022 Balance b/d 19,000

Bank Statement
Date Details Debit Credit Balance
01-07-2022 Balance b/f 16,000
06-07-2022 Cash deposit 20,000
10-07-2022 Cheque Payment 8,500

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

12-07-2022 Cheque payment 17,500

14-07-2022 Cheque deposit 14,000
15-07-2022 Standing order 19,000
27-07-2022 Direct deposit 8,000
28-07-2022 Cheque deposit 15,000
30-07-2022 Cheque payment 12,000
31-07-2022 Bank charges 2,000 14,000

(b) Adjust the bank account balance(updated cash book) as at 31.07.2022. (5 marks)

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(c) Prepare the bank reconciliation statement using the adjusted bank balance (5 marks)

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Second Term Examination, March 2023 Year 10 Accounting 4C01/01

(d). Explain the following terms; (3 marks)

I. Bank overdraft
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II. Standing order

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(Total marks for the question 18= 15 marks)

[Total marks for the section B=75]

[Total marks for the paper =100]

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