2018 accounting-nht written examination€¦ · you are not required to balance the accounts. 7...

ACCOUNTINGWritten examination

Friday 1 June 2018 Reading time: 10.00 am to 10.15 am (15 minutes) Writing time: 10.15 am to 12.15 pm (2 hours)

QUESTION BOOK

Structure of bookNumber of questions

Number of questions to be answered

Number of marks

8 8 100

• Studentsarepermittedtobringintotheexaminationroom:pens,pencils,highlighters,erasers,sharpeners,rulersandonescientificcalculator.

• StudentsareNOTpermittedtobringintotheexaminationroom:blanksheetsofpaperand/orcorrectionfluid/tape.

Materials supplied• Questionbookof13pages• Answerbookof19pages

Instructions• Writeyourstudent numberinthespaceprovidedonthefrontcoveroftheanswerbook.• Answerallquestionsintheanswerbook.• AllwrittenresponsesmustbeinEnglish.

At the end of the examination• Youmaykeepthisquestionbook.

Students are NOT permitted to bring mobile phones and/or any other unauthorised electronic devices into the examination room.

©VICTORIANCURRICULUMANDASSESSMENTAUTHORITY2018

Victorian Certificate of Education 2018

2018ACCOUNTINGEXAMQB(NHT) 2

Question 1–continued

Question 1 (16marks)Wang’sEmporiumsellsarangeofelectricalgoods.Thebusinessusesamark-upof50%oncostanditreportsmonthly.

Balancesat1May2018StockControl $31500drCreditorsControl $13200cr

Thefollowingjournalssummarisethebusiness’sMaytransactionsupto31May.

Cash Payments Journal (summary)

Date 2018

Details Cheq. No.

Bank Disc. Rev.

Creditors Control

Stock Control

Wages Sundries GST

31May Totalstodate – 19420 – 7 800 4000 4500 2800 320

Theitemsinthe‘Sundries’columnwere:• PrepaidInsurance$1600• Drawings$1200.

Cash Receipts Journal (summary)

Date 2018

Details Rec. No.

Bank Disc. Exp.

Debtors Control

Cost of Sales

Sales Sundries GST

31May Totalstodate – 250 12000 2000 3000 7 000 300

Theitemsinthe‘Sundries’columnwere:• Capital$5000• PrepaidSales$2000.

Sales Journal (summary)

Date 2018

Debtor Invoice No.

Cost of Sales

Sales GST Debtors Control

31May Totalstodate – 15000

Purchases Journal (summary)

Date 2018

Creditor Invoice No.

Stock Control

GST Creditors Control

31May Totalstodate – 9000 900 9900

3 2018ACCOUNTINGEXAMQB(NHT)

TURN OVER

Thefollowingtransactionshavenotyetbeenrecorded.

Simsong Electrics CreditNote:888 Wang’s Emporium

30May2018 Memo:61 31May2018

To:Wang’sEmporium Writedowneachofthe11supersededdigitalradiosfrom$125to$65. T Wang

For:Creditforfaulty goodsreturned $1200

GST $ 120Total $1320

a. CompletethefourmissingfiguresintheCashReceiptsJournalandtheSalesJournal. 2marks

b. PrepareGeneralJournalentriestorecordthetwosourcedocumentsabove. Narrationsarenotrequired. 4marks

c. ShowhowthefollowingaccountswouldappearintheGeneralLedgerafteralltransactionsfromthejournalshavebeenposted:• StockControl• CreditorsControl

Youarenotrequiredtobalancetheaccounts. 7marks

d. Withreferencetoonequalitativecharacteristic,explaintheneedtoreporttheinformationinMemo61. 3marks


Question 2 (9marks)Aldotto sellsarangeofhigh-qualityimportedleatherbags.ThebestsellingbagistheMilano.TheStockCardfortheMilanobagforJune2018isshownbelow.

Product: Milano bag Cost Assignment Method: FIFO

Date 2018

Details IN OUT BALANCE

Qty Cost Total Qty Cost Total Qty Cost Total

June1 Balance 195 120 23400

8 Rec.158 80 120 9600 115 120 13800

14 Chq.67 5 120 600 120 120 14400

22 CrN.521 20 120 2400 100 120 12000

ThefollowingtransactionshavenotyetbeenenteredintotheStockCardfortheMilanobag:• 28June 100Milanobagswerepurchasedatacostof$128(plusGST)eachandAldotto

paiddeliveryof$400(plusGST)(InvoiceV465).• 29June 130Milanobagsweresoldatasellingpriceof$240(plusGST)each

(Receipts298–427).• 30June Astocktakeshowed73Milanobagsonhand(Memo125).

a. StatethetransactionthatgaverisetotheentryintheStockCardon22June. 1mark

b. CompletetheStockCardfortheMilanobagforJune. 3marks

c. PreparetheGeneralJournalentrytorecordthetransactionon30June. Anarrationisnotrequired. 2marks

d. TheownerbelievestheMilanobagsonhandat30Juneshouldallbevaluedattheirexpectedsellingpricebecause‘thatiswhattheyareworthtothebusiness’.

Withreferencetooneaccountingprinciple,explainwhytheMilanobagsshould notbevaluedattheirexpectedsellingprice. 3marks


TURN OVER

Question 3 (15marks)Fionahadbeenproducingarangeofhand-decoratedchocolatesathomeasahobbybeforesheestablishedasmallbusinesscalledChocBloks.ThebusinessusesspecialjournalsandtheGeneralJournal,andreportsmonthly.Thebusinesscommencedon1June2018,whenFionadeposited$8000intoabusinessbankaccount(Receipt001).Asiteatacitymarketwasobtainedbypaying$1200(plusGST)forrentforathree-monthperiodcommencing1June2018(Cheque4511).Fittingscosting$4800(plusGST)werepurchasedfromShopFit(Invoice898)andinstalledon 1June2018.StockpurchasesduringJunetotalled$3550(plusGST)(Cheque4512).SalesduringJunetotalled$8000(plusGST)(cost$2300,plusGST)(Receipts2–8).Apaymentof$1000wasmadetoShopFiton29June2018(Cheque4513).

Additional information• Thefittingsaretobedepreciatedat25%perannumoncost.• Stockonhandat30June2018was$1250.

a. PreparetheappropriateGeneralJournalentriesrequiredfortheJune2018transactions. Narrationsarenotrequired. 6marks

b. PreparetheBalanceSheetforChocBloksasat30June2018. 9marks


Question 4 (9marks)HPGFreportsannuallyon30June.Itpurchasedalargepackingmachineon30June2012.Thefollowinggraphshowsthecarryingvalueofthepackingmachineat30Juneeachyear.

45 000

40 000

35 000

30 000

25 000

20 000

15 000

10 000

5 000

0

Carrying value of packing machine at 30 June each year

$40 000

$34 000

$28 000

$22 000

$16 000

$10 000

2012 2013 2014year

2015 2016 2017

carryingvalue ($)

a. Withreferencetooneaccountingprinciple,explainthedepreciationmethodusedforthepackingmachine. 3marks

b. Explainwhatthecarryingvalueof$28000at30June2014represents. 2marks

c. On1July2017thepackingmachinewastradedinforanallowanceof$8500onanewmachinefromXTPackers.

PreparetheDisposalofPackingMachineledgeraccounttodeterminetheprofitorlossonthedisposalofthepackingmachine. 4marks


TURN OVER

Question 5 (18marks)JBSportsellssportinggoodstoclubsandtothepublic.Itpreparesreportsattheendofeachmonth.On24June2018,BayFCordered40footballs.Thefootballssellfor$75each(plusGST) (costpriceis$50each,plusGST).BayFCprovidedacashdepositof$500(Receipt524).ThefootballsweredeliveredtoBayFCon16July2018andBayFCwasinvoicedforthebalanceowing(Invoice2134).

a. Explainhowthedepositof$500wouldbetreatedinJBSport’sfinancialreportson 30June2018. 3marks

b. PreparethejournalentriesrequiredbyJBSporttorecordthetransactionon16July2018and thebalancedayadjustmenton31July2018.

Anarrationisnotrequired. 4marks

RelevantaccountbalancesfromJBSport’sadjustedTrialBalanceat31July2018were:

$DepreciationofFittings 4000Sales 285000CostofSales 109000Wages 68000Rent 13000DiscountRevenue 2000Capital 350000Drawings 38000

c. Usingtheinformationprovided,preparetheGeneralJournalentrytocloseexpenseaccounts. Narrationsarenotrequired. 3marks

d. ShowhowtheProfitandLossSummaryaccountandtheCapitalaccountwouldappearintheGeneralLedgeraftertheclosingentrieswereposted.Noadditionalcapitalwascontributedduringtheperiod.

Youarenotrequiredtobalancetheaccounts. 6marks

e. Explainthepurposeofclosingentriesintheaccountingprocess. 2marks


Question 6 (10marks)TheownerofBladeStorehasbeenreviewingbusinessperformanceandhasrecentlycommentedthat‘businesshasreallypickedupinthelastcoupleofyears’.Theaccountanthasproducedthefollowinggraphtouseasthebasisforadiscussion.

60

50

40

30

20

10

0

percentage(%)

320 000

310 000

300 000sales ($)

290 000

280 0002015 2016

year

2017

54%51%

50%

30% 23%20%

Blade Store – Key profit indicators Key

Sales ($)

Gross ProfitMargin (%)Net ProfitMargin (%)

a. Usingthedatainthegraphabove,discusstrendsinBladeStore’sprofitability. 6marks

b. Providetwoexamplesofnon-financialinformationthatthebusinesscouldalsousetoassessprofitabilityandexplainhowthebusinesscoulduseeachexample. 4marks


TURN OVER

CONTINUES OVER PAGE



Question 7 (11marks)VescoTapsreportsannuallyon31Decemberandalsobudgetsonanannualbasis.IthaspreparedtheBudgetedIncomeStatementandBudgetedBalanceSheetfortheyearending31December2018,andnowitneedstopreparetheBudgetedCashFlowStatementforthesameperiod.Thefollowinginformationisprovided.

Vesco TapsBudgeted Income Statement for the year ending 31 December 2018

$ $RevenueSales 820000LessSalesReturns 10 000Net Sales 810 000LessCostofSales 380000Gross Profit 430000Plus Other RevenueDiscountRevenue 8 000 438000Less ExpensesWages 137000RentExpense 26000BadDebtsExpense 2000DepreciationofEquipment 36000InterestExpense 12000 213000Net Profit 225 000


TURN OVER

Vesco TapsBudgeted Balance Sheet as at 31 December

2017 Actual

2018 Budgeted

Current Assets

Cash 21600 41600

DebtorsControl 110600 122000

PrepaidRentExpense 20000 30000

StockControl 148800 134400

Non-Current Assets

Equipment 417000 479000

LessAccumulatedDepreciationofEquipment (180000) (189000)

Total Assets 538 000 618 000

Current Liabilities

GSTClearing 3800 2600

CreditorsControl 115200 125600

AccruedWages 3000 4800

Loan–BankXYZ 56000 56000

Non-Current Liabilities

Loan–BankXYZ 131000 75000

Owner’s Equity

Capital 229000 354000

Total Equities 538 000 618 000

Additional information (budgeted) for the year• Allsalesandpurchasesofstockwillbeoncredit.• VescoTaps willselloldequipmentthatoriginallycost$45000for$6200.Itwillalso

purchasenewequipmentforcash.• Theownerwilltakedrawingsduringtheyearincluding$5000stockforahome

renovation.• Therewillbenocapitalcontributionsduringtheyear.

a. Calculatethebudgetedcashtobepaidforwages. 2marks

b. Withreferencetoonequalitativecharacteristic,explainwhythereisadifferencebetweenthebudgetedcashpaidforwagesandthebudgetedwagesexpensefortheyear. 3marks

c. PreparetheinvestingandfinancingsectionsoftheBudgetedCashFlowStatementfortheyearending31December2018. 6marks



Question 8 (12marks)MacsMediasellsarangeofITproducts.Salestootherbusinessesareoncredit(terms5/10,n/30)andsalestoindividualcustomerswhocomeintothestorearecashsales.Stockispurchasedoncredit,withmanyproductsbeingimporteddirectlyfromoverseas(creditterms3/10,n/45).Thebusinesshasfocusedonupgradingitsshopfrontoverthepastsixmonths,includinginstallingadditionalsecuritymeasuresinanattempttoreducestockloss.Somefinancialinformationfortheyearended30June2018isprovidedbelow.

Revenue for the year ended 30 June 2018

Expenses for the year ended 30 June 2018

CreditSales 70% CostofSales 50%

CashSales 25% Wages 25%

OtherRevenue 5% Advertising 10%

StockLoss 7%

BadDebts 5%

Interest 3%

FinancingActivities

InvestingActivities

OperatingActivities

$100000

$50000

0

–$50000

–$100000

–$150000

Cash Flow Activities for the year ended 30 June 2018

Financial indicator 2017 2018

DebtorsTurnover 61days 65days

CreditorsTurnover 42days 33days

StockTurnover 59days 57days

DebtRatio 26% 40%


a. Identifytwotypesofrevenue,otherthanDiscountRevenue,thatcouldappearintheOtherRevenuesectionofMacsMedia’sIncomeStatement. 2marks

b. MacsMedia’saccountantisconcernedabouttheliquidityofthebusiness.

Usingtheinformationprovided,identifyanddiscusstheissuestheaccountantmaybereferringto. 6marks

c. ExplaintwostrategiesthattheownerofMacsMediacouldimplementinordertoimproveliquidity. 4marks

END OF QUESTION BOOK

Instructions

• Aquestionbookisprovidedwiththisanswerbook.• Answerallquestionsinthespacesprovidedinthisbook.• Writeyourstudent numberinthespaceprovidedaboveonthispage.• RefertoInstructionsonthefrontcoverofthequestionbook.

Students are NOT permitted to bring mobile phones and/or any other unauthorised electronic devices into the examination room.

©VICTORIANCURRICULUMANDASSESSMENTAUTHORITY2018

ACCOUNTINGWritten examination

Friday 1 June 2018 Reading time: 10.00 am to 10.15 am (15 minutes) Writing time: 10.15 am to 12.15 pm (2 hours)

ANSWER BOOK

SUPERVISOR TO ATTACH PROCESSING LABEL HEREVictorian Certificate of Education 2018

STUDENT NUMBER

Letter

2018ACCOUNTINGEXAMAB(NHT) 2

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3 2018ACCOUNTINGEXAMAB(NHT)

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Question 1 –continued

Question 1 (16marks)a. 2marksCash Receipts Journal (summary)

Date 2018

Details Rec. No.

Bank Disc. Exp.

Debtors Control

Cost of Sales

Sales Sundries GST

31May Totalstodate – 250 12000 2000 3000 7000 300

Theitemsinthe‘Sundries’columnwere:• Capital$5000• PrepaidSales$2000.

Sales Journal (summary)

Date 2018

Debtor Invoice No.

Cost of Sales


31May Totalstodate – 15000

b. 4marksWang’s EmporiumGeneral Journal

Date 2018

Details General ledger Subsidiary ledger

Debit Credit Debit Credit


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c. 7marksStock Control

Date 2018

Cross-reference Amount Date 2018

Cross-reference Amount

1May Balance 31500

Creditors Control

Date 2018

Cross-reference Amount Date 2018


1May Balance 13200

d. 3marks

Qualitative characteristic

Explanation


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Question 2 (9marks)a. 1mark

Transaction

b. 3marksStock Card

product: Milano bag Cost Assignment Method: FIFO

Date 2018

Details IN OUT BAlANCE

Qty Cost Total Qty Cost Total Qty Cost Total

June1 Balance 195 120 23400

8 Rec.158 80 120 9600 115 120 13800

14 Chq.67 5 120 600 120 120 14400

22 CrN.521 20 120 2400 100 120 12000


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c. 2marksAldottoGeneral Journal

Date 2018



d. 3marks

Accounting principle

Explanation


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Question 3 (15marks)a. 6marksChocBloksGeneral Journal

Date 2018




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b. 9marks

Working space

ChocBloksBalance Sheet as at 30 June 2018

$ $ $ $

Current Assets Current liabilities


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Question 4 (9marks)a. 3marks

Accounting principle

Explanation

b. 2marks

Explanation

c. 4marksDisposal of Packing Machine

Date2017

Cross-reference Amount Date2017



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Question 5 –continuedTURN OVER


Cash Flow Statement

Income Statement

Balance Sheet

b. 4marksJBSportSales Journal

Date 2018

Debtor Invoice No.

Cost of Sales


JBSportGeneral Journal

Date 2018




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c. 3marksJBSportGeneral Journal

Date 2018



d. 6marksProfit and Loss Summary

Date2018



Capital

Date2018




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e. 2marks

Explanation


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Question 6 –continued


Discussion


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b. 4marks

Example 1

Example 2


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Working space

Budgeted cash to be paid for wages $

b. 3marks

Qualitative characteristic

Explanation


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c. 6marks

Working space

Vesco TapsBudgeted Cash Flow Statement (extract) for the year ending 31 December 2018


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Revenue type 1

Revenue type 2

b. 6marks

Identification and discussion


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c. 4marks

Strategy 1

Strategy 2

END OF ANSWER BOOK

2018 accounting-nht written examination€¦ · you are not required to balance the accounts. 7...

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