b Acid test worse due to lack of cash because of expenditure on stock Stockturn

B acid test worse due to lack of cash because of

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If answer not to 2 decimal places, but correct working shown, full marks. (b) Acid test worse, due to lack of cash because of expenditure on stock Stockturn worse due to surplus unsold stock Debtors collection worse due to poor credit control. GP ratio worse due to increased cost price not passed on to customer. NP ratio worse due to increased operating expenses. ROCE almost unchanged/slightly worse due to similar rates of change in capital and net profit 2 for each, maximum (12) These answers are not exclusive - use your judgement.
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Page 2 Mark Scheme Syllabus Paper ACCOUNTING – JUNE 2004 9706 2 © University of Cambridge International Examinations 2004 (c) Advantages Show trends Help compare with (i) earlier years (ii) other businesses Help decision making Show particular problem areas Maximum (3) Comparisons may be difficult due to Disadvantages (i) changes in the economy (ii) changes in technology (iii) changes in Staff (iv) changes in company policy Reasons for changes are not always obvious Accuracy of information may be a problem Historic cost used - takes no account of inflation Maximum (3) These answers are not exclusive - use your judgement.
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Page 3 Mark Scheme Syllabus Paper ACCOUNTING – JUNE 2004 9706 2 © University of Cambridge International Examinations 2004 AS ACCOUNTING - SUMMER 2004 - 9706/2 A2 (a) Working for Goodwill Titus Ronicus Net effect Introduced $ $ $ $30 000 worth $ 45 000 Titus 15 000 Cr 15 000 Cr $27 100 worth $30 000 Ronicus 2 900 Cr 2 900 Cr Titus 9 000 Dr 6 000 Dr 15 000 Dr Ronicus 1 740 Dr 1 160 Dr 2 900 Dr Net 4260 Cr 4 260 Dr Must have same amount total of goodwill on both sides and must cancel out or no marks as Goodwill would otherwise have to appear as an account. Capital Accounts Titus Ronicus Titus Ronicus $ $ $ $ 49 260 4 260 25 740 30 000 45 000 4 260 30 000 49 26 0 30 000 49 260 2 Sundries 1 Goodwill Balance b/d Alternative Capital Accounts Goodwill Balance c/d Titus Ronicus 49 260 Titus 25 740 Ronicus 2 2 1 OF (8) $ $ $ $ Goodwill 1 740 6 000 2 Sundries 45 000 30 000 2 Balance c/d 49 260 25 740 1 Goodwill 6 000 1 740 2 51 000 31 740 51 000 31 740 Balance bid 49 260 25 740 1 OF (8) Titus Ronicus Titus Ronicus Goodwill 10 740 7 160 2 Sundries 45 000 30 000 2 BaI cid 49 260 25 740 1 Goodwill 15 000 2 900 2 60 000 32 900 60 000 32 900 Bal b/d 49 260 25 740 1 OF (8)
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Page 4 Mark Scheme Syllabus Paper ACCOUNTING – JUNE 2004 9706 2 © University of Cambridge International Examinations 2004 (b) Profit and Loss Appropriation Account for the year ended 30 September 2004 $ $ $ Net Profit 56 000 (1) + 1050 (2) 57 050 3 Interest on Drawings Titus 450 Ronicus 250 700 1 Not 2 57 750 Interest on Capital Titus 2 463 1 OF Ronicus 1 287 3 750 1 OF Partner's Salary Ronicus 20 000 23 750 1 34 000 Share of Residue Titus 20 400 unless 1 OF Ronicus 13 600 aliens 34 000 1 OF (9) (c) Titus Current Accounts Ronicus Titus Ronicus $ $ $ $ Drawings 9 000 5 000 2 Share of Residue 20 400 13 600 2 Int on drawings 450 250 2 Int on Capital 2 463 1 287 2 Goods taken 600 450 2 Salary 20 000 1 Balance c/d 12813 29187 1 ______ ______ 22863 34 887 22 863 34 887 Balance b/d 12 813 29 187 1 (13)
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Page 5 Mark Scheme Syllabus Paper ACCOUNTING – JUNE 2004 9706 2 © University of Cambridge International Examinations 2004 A/S ACCOUNTING SUMMER 2004 - 9706/2 Hours worked = 30 workers x 30 hours x 50 weeks = 45000 =10 hours/unit = $6/hour A3 $ $ (a) Sales 4500 x 250 1,125,000 1 Direct Materials 4500 x 35 157,500 1 Direct Labour 45000 x 6 270,000 2 Variable Costs V Overheads 4500 x 12
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