TEST CODE 01239010
FORM TP 2020027
CARIBB E A N
J ANU ARY
E XAMINATI O NS
2020
C OU NCIL
CARIBBEANSECONDARY E DUCATION CERTIFICATE®
EXAMINAI
T ON
PRINCIPLES OF ACCOUNT S
Pape r 01
- General Proficiency
1ho11r30 mi11t1tes
(08 JANUARY 2020 (p.m.))
READ THE FOLLOWING INSTRUCTIONS CAREFULLY.
1.
This test consists of 60 items. You will have
2.
In addition to this test booklet, you should have an answer sheet.
3.
Each item in this test has four suggested answe1s lettered ( A), ( B), ( C), (D). Read each item
you are about to answer and decide which choice is best.
4.
On your answet" sheet, find the number which corresponds to your item and shade the space
having the same letter as the answer you have chosen. Look at the sample item below.
1 hour
and
30
minutes to answer them.
fuillml e Item
Prime cost is calculated by adding direct
factory expenses tp the
( A)
(B)
(C)
(D)
S!m:i.ple Answer
cost of goods sold
cost of materials used
sale of finished goods
sale of non-current assets
The best answer to this item is "cost of materials used", so (B) has been shaded.
5.
If yqu want to change your answer, erase it completely before you fill in your new choice.
6.
When you are told to begin, turn the page and work as quickly and as carefully as you can.
If you cannot answer an item, go on to the next one. You may return to that item later.
7.
You may use a silent, non-programmable calculator to answer items.
DO NOT TURN TIDS PAGE UNTIL YOU ARE TOLD TO DO SO.
Copyright <Cl
012390 l O/J/ CSEC 2020
2019
Caribbean Examinations Council
All rights reserved.
-21.
Which of the following financial statements
shows the value of n business' assets?
(A)
(B)
(C)
(D)
2.
Balance sheet
Trading account
Cash flow statement
Profit and loss account
Cash at bank
Inventory
Payables
Receivables
Bank overdraft
Cash in hand
local communities
(A)
(B)
(C)
(D)
government agencies
Ill.
(A)
(B)
(C)
(D)
Integrated analysis of information
Almost immediate updating of
records
Progl11
· mmable t o recognize
irregular entries
(A)
(B)
(C)
(D)
6.
II.
III.
Posting to ledger,journalizing, trial
balance
Posting to ledger, trial balance,
journalizing
Journ111izing, postmg to ledger, tri11l
balance
Joumaltzing, trial balance, posting
to ledger
(A)
(B)
(C)
(D)
7.
$405
$450
$850
$975
Pru-tnerships arc formed for the purpose of
I.
I and II only
I and III only
II and III only
l, II and III
Which of the following lists of activities
shows the correct order of the stages in the
accounting cycle, before final accounts?
$
800
400
600
125
250
500
From the information above, Mr Jones'
capital amount is
managers
competitors
Which of the following features are
benefits of using accounting software?
I.
II.
4.
The following information refers to the
assets and liabilities of Mr J ones.
The MAIN internal users of accounting
information are
(A)
(B)
(C)
(D)
3.
5.
combining c11pital from diffelent
persons
benefiting from different skills and
specializations
sharing ideas, experience and
responsibilities
I and 11 only
I and III only
II and Ill only
I, II and III
Which of the followfog is usually used to
complete a gcneialjournal entry?
(A)
(B)
(C)
(D)
Narration
Description of assets
Description of liabilities
Name of book to which entry must
be posted
GO ON TO THE NEXT PAGE
01239010/J/CSEC2020
-3Item 8 refers to the following balances at
the end of a financial per:iod.
Motor vehicles
Payables
Receivables
Capital
Building
s.
BALANCES
Rent owing
Cash
Payables
Prepaid insurance
Bank overdraft
12.
13.
I.
III.
Mortgages
Accounts payable
Accrued wages
(A)
(B)
(C )
(D)
I and II only
I and m only
II and lH only
I, II and III
1: l
1.5: I
2.1 : l
3.1 : l
Which of the following entries should be
used to post sales returns?
(A)
$ 50
$450
$490
$550
(B)
( C)
(D)
14.
$ 200
$3 500
$1 200
$ 300
$ 400
What is the current ratio of Sherida's Ltd?
(A)
(B)
(C)
(D)
Which of the following items are examples
of current liabilities?
II.
11.
$12 000
$13 000
$14 000
$15 000
Ram Singh purchased goods valued at $500
on credit. He paid off his bill within the grace
period and so received a 10% cElSh discount.
How much did he pay for the goods?
(A)
(B)
(C)
(D)
10.
$
2 000
3 000
2 000
11 000
10 000
What is the T,OTAL amount for the assets?
(A)
(B)
( C)
(D)
9.
Item 12 refers to the following balances
taken from t.he books of Sherida's Ltd on
30 April 2019.
·
Debit sales returns account
Credit the receivable account
,
Debit sales returns account
Credit sales account
Debit sales account
Credit sales returns account
Debit the receivable account
Credit sales rc;t1.1rns account
Which of the following persons monitor a
company's financial statements, to discovet·
a desirable rate of return on capital?
(A)
(B)
( C)
(D)
Investors
Suppliers
Customers
Employees
Which of the following entries in a three­
column cash book are contra enhies?
(A)
(B)
( C)
(D)
Debit cnsh, Credit bank
Debit cash, Credit cash
Credit cash, Credit bank
Debit bank, Credit bank
01239010/J/CSEC 2020
GO ON TO THE NEXT PAGE
-4Item 15 iefers to the following info1mation
from the books of a company.
17.
$
Cash sales
IO 000
Credit sales
45 000
Inventory on hand
40 000
Drawings
15.
12 000
Credit purchases
20 200
From the information above, what is the
conect closing total for the sales account?
(A)
(B)
(C)
(D)
16.
8 000
Cash purchases
$47000
$49 000
$55 000
$59 000
Which of the following entries would
NOT appear in a cash book?
( A)
(B)
( C)
(D)
Payment for goods
Goods sold on cred�t
Goods sold for cheque
Goods bought for cash
01239010/J/CSEC 2020
$100
$100
$100
$100
18.
K. Khan, a debtor of A and B Enterprises,
settles his debt of $120 loss discount, by
cheque. How should tho double entry
be recorded in the books of A and B
Enterprises?
(A) Debit K. Khan
Debit discount received
Credit bank
$117
$ 3
$120
(B) Debit K. Khan
Debit discount allowed
Credit bank
$117
$ 3
$120
(C) Debit bank
Debit discount allowed
C1 edit K. Khan
$117
$ 3
$120
(D)
$117
$ 3
$120
Debit bank
Credit discount received
Credit K. Khan
Mr A. Jones paid $250 in cash for Lepairs to
machinery. This transaction was entered in
the cash book and posted to the ledger. The
double entry involved would be
(A )
Debit cash account
Credit repairs account
(B)
Debit cash account
Credit machinery account
(C)
Debit repairs account
Credit cash account
(D)
Debit A. Jones account
Credit cash account
GO ON TO THE NEXT PAGE
-5 -
19.
In orderto avoid writing numerous cheques
for small amounts, a firm may set up a
(A)
bnnk draft
petty cash fund
(C)
general journal
bank standing order
(B)
(D)
21.
record this transaction?
Debit
from the sales book ofR. Lewis.
2Jan
45
(D)
t%
Trade discount
./
7J
l!
Debit new computer
Debit cash
(C)
Less 33
Debit old computer
Debit cash
$6 000
$4 000
$2 000
$6 000
$6 000
$4 000
Credit new computer
$2 ODO
Debit new computer
$6 000
Credit old computer
li
�
22.
Debit H. Rick's account
Credit sales account
$45
$45
(B)
Debit H. Rick's account
,'j;30
Credit sales day book
$30
(C)
Debit H. Rick's account
$45
Credit sales account
$30
(D)
Debit H. Rick's account
$30
Credit sales account
$30
Credit
$2 000
$4 000
Credit cash
How would R. Lewis record t h i s
information in his ledger?
(A)
(B)
H. Rick
30@$1.50
2 0.
Debit old computer
Debit cash
Credit old computer
$
2019
(A)
Credit new computer
ll!<!!l2Q refers to the following information
'·1)
A businessman bought a new computerfor
$6 000. He paid $4 000 in cash and traded
in his old computer. What is the entry to
$2 000
$4 000
When a proprietor withdraws cash or other
assets fiom a business, what effect does it
have on drawings or capital?
(A)
(B)
(C)
(D)
Capital is increased.
Capital is decreased.
Drawings are decreased.
Neither drawings nor capital is
affected.
GO ON TO THE NEXT PAGE
01239010/J/CSEC 2020
- 6-
Items 23-25 refer to the following Statement of Financial Position (B alance Sheet).
$
$
10 000
Leasehold premises
Furniture, fittings and equipment
4 500
14 500
2 500
Inventory
Receivables
B ank current ale
Cash in hand
3 700
2 100
500
Capital at start
Accrued expenses
(A)
(C )
(D)
(B)
(C)
(D)
1200
3 300
23 300
$11 200
$14 500
$20 000
$23 300
$20 000
$20 700
$21 800
$22 800
The working capital i s
(A)
(B)
(C)
(D)
26.
2 100
The closing capital is
(A)
25.
1 800
20 000
What is the total value of the fixed assets?
(B)
24.
2 200
21 800
Less drawings
23 300
23.
24 000
Less loss for year
Creditors
8 800
$
$
$2 GOO
$5 500
$6 200
$6 800
In calculating the gross profit pcrcentnge, gross profit should be divided by
(A)
(B)
(C)
(D)
cost of goods sold
net purchases
net profit
net sales
01239010/J/CSEC 2020
GO ON TO THE NEXT PAGE
.7.
Item 27 refers to the following information.
De bit
Insurance Ale
2017
$
2017
700
31 December
Profit & Loss
31
Balance c/d
2 January
15
January
27.
Bank
$
December
A/c
8 100
600
8 700
What is the amount of insurance prepaid at the end of the year?
(A)
(B)
(C)
(D)
28.
Balance b/d
C1·edit
$
$
600
700
$8 000
$8 100
Which of the following :financinl documents shows the net earnings of a business?
(A)
(B)
(C)
(D)
Income Statement
Appropriation Account
Statement of Financial Position
Receipts and Payments Account
Item 29 refers to the following table.
Period of Debt
29.
Amount of Accounts
Receivable
Provision for Bnd Debts
Over 3 years
$6 000
3% of
Over2 years
$4 000
2% of accounts
accounts receivable
Over 1 year
$8 000
I% of accounts i eceivable
receivable
What is the TOTAL provi�ion for doubtful debts?
(A )
(B)
$ 40
(C)
$400
(D)
$180
?
$500
GO ON TO THE NEXT PAGE
01239010/J/CSEC 2020
30.
An asset purchased for $1 ODO is depreciated
at the rate of 1D% per annum using the
reducing balance method. What is the book
value of the asset at the beginning of the
third year?
(A)
( B)
(C)
(D)
31.
$ SOD
$ 81D
$ 9DD
$1 190
Item 33 refers to the following information.
On 1 January 2019, $10 ODO was paid
towards an advertising campaign. Of this
amount, $7 000 was used by 31 December
2019.
33.
(A )
(B)
(C)
increase in the provision for doubtful
debts wilt be
An
(A)
(B)
(C)
(D)
added to sales in the trading account
subtracted from sales in the trading
account
included as revenue in the profit
and loss account
included as an expense in tho profit
and Joss account
(D)
34.
32.
(D)
$
60 ODO
$ 40 ODO
$ 9D 000
$150 DOD
$190 000
Total unpresented cheques
Lodgement not entered
on bank statement
Balance per cash book
35.
$
120
150
560
What is the balance per bank statement?
(A)
(B)
(C)
(D)
01239010/J/CSEC 2020
Credit the bank account with $25.
Debit the bank account with $25.
Add $25 to the bank statement
balance.
Subtract $25 from the bank
statement balance.
Item 35 refers to the following information
p1 ovided by a business.
lDO ODO
200 ODO
150 ODO
What was the capital of Foster and Scott
Limited at 6 March 20187
(A)
(B)
(C)
(D)
$ 3 000
$ 7 000
$ 1D DOO
$17 000
A standing order of $25 for insurance
appears in the debit column of the bank
statement. This amount does not appear
in the cash book. How is this item treated
in order to update the cash book?
(A)
(B)
(C)
Item 32 refers to the following tnble which
shows the summarized position of Foster
and Scott Limited at 6 March 2019.
Current liabilities
Current assets
Non-current assets
Non-current liabilities
What was the amount of advertisingprepaid
at year's end?
$120
$150
$340
$530
GO ON TO THE NEXT PAGE
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Item 36 refers to the following information.
38.
each of them deposited $5 000 into a bank
account. How should this be iecorded in
$
Inventoryat1January2019
Purchasesduringthcmonth
Cost of goods sold
36.
l 500
the books of the pa1tnership?
1 200
1 400
What is theinventory attbe end ofJanuary?
(A)
$
(C)
500
700
$1 300
(B)
(D)
$
$
MrGreen andMrsBlack agreed to establish
a partnership, Green and Black Co. and
(A)
Credit cash $10 000
(B)
DebitGreen andBlack.Co.$1O000
(C)
Debit partnership bank account
$10 000
300
Debit capital $10 000
Cl'edit bank $10 000 each
Credit partners' current accounts
$5 000 each
37.
MrsAllen invested $20 000 andMrsBrown
and Mr Cable invested $5 000 each into
(D)
the same business. The loss sustained
during the year was$1000. The pnrtnership
Debit partnership bank account
$10 000
Credit partners' capital accounts
$5 000 each
agreement is silent on the item of losses,
although profits are to be split in the Latia
2:2:1 in favour of Allen, Brown and Cable
respectively. How much of the loss must
be borne by Mr Cable?
(A)
$140
(B)
(C)
$300
(D)
$200
$400
39.
A trader had an opening capital of$3 900.
If his drawings were $900 and his closing
capital was$4 860, what was the net profit?
(A)
(B)
(C)
(D)
$
900
$ 960
$1 860
$3 000
GO ON TO THE NEXT PAGE
01239010/J/CSEC 2020
- 10 -
40.
Rose contributed $7 000 in cash and a motor vehicle worth $3 000 to a partnership. Rose's
contribution to the partnership would be recorded in the journal a s
Debit
$
(A)
Cash
Rose's capital
10 000
(B)
Rose's capital
7 000
(C)
Cash
Motor vehicle
7 000
3 000
Rose's capital
Molo1 vehicle
10 000
Cash
Rose's capital
(D)
Cash
41.
In a cooperative society, 1he daily affairs are
Credit
$
10 000
7 000
10 000
3 000
7 000
44.
administered by
(A)
(B)
(C)
(D)
42.
nil membets
a majority of shareholders
the chaim1an of the board only
be
( A)
(B)
pe1sons elected or appointed to do
( C)
(D)
so
The owner of a business paid a pe1sonal
medical bill from the bank account of the
business. The amount was debited to the
45.
miscellaneous expenses account. Which
of the following concepts wa& violated?
(A)
(B)
(C)
(D)
43.
According to the Partnership Act, if there
is no Deed of Partnership, the amount of
profitto be received by EACHpartncrwould
Consistency
Business entity
(A)
(C)
(D)
$4 000
$4 050
$4 500
$4 980
01239010/J/CSEC 2020
invested
Which of the following items on a State­
ment of Financial Position would differ
MOST in presentation when comparing
the books of a company and the books of
( A)
(B)
(C)
(D)
A photocopying machine valued at $5 000
is depreciated at 10% using the straight line
(B)
calculated nt5% on capital invested
divided in proportion to capital
a sole trader?
Matching
Prudence
method. What is its book value after TWO
years?
divided equally
calculated at 5% of net profit
46.
Non-cunent assets
Current liabilities
Current assets
Capital
The reward of profit received by a
shareholder in a limited company is called
(A)
(B)
(C)
(D)
interest
drawings
dividends
commission
GO ON TO THE NEXT PAGE
- 11 -
47.
How does an increase in bad debts affect a
sole trader's financial statements?
(A)
(B)
(C)
(D)
48.
The purpose of an appropriation account is
to
(A)
Decreases the gross profit
Increases the gross profit
Decreases the net profit
Increases the net profit
(B)
(C)
Which of the following accounts are
nominal?
(A)
(B)
(C)
(D)
49.
51.
(D)
Wages and Rent
Machinery and Plant
Payables and Fixtures
Inventory and Receivables
52.
Which of the following terms BEST
dcscdbes the final accounts of a non-profit
organization?
I.
II.
ill.
(B)
(C)
(D)
(B)
(C)
(D)
I and II only
I and ill only
II and ID only
I, II and III
When writing up the books ofa partnership,
which account must EACH partner have?
(A)
(B)
(C)
50.
An example of a capital expenditure ls
Sales
Surplus
Inventory
Working capitnl
J
53.
(A)
If revenue expenditure is overstated, which
of the following items will be affected?
(A)
Income Statement
Receipts and Payments Account
Statement ofFinancial Position
show howthenet profit is distTibuted
in a partnership or co-operative
change capital expenditure as
agreed upon in the Articles of
Association
enter all capital and revenue
expendih1re as stipulated in the
Partnership Act
make appropriate changes related
to net profit as agreed upon in the
Articles of Association
(D)
Bank
Current
Savings
Fixed deposit
money spent for
(A)
(B)
: (C)
(D)
paying rent
paying wages
purchasing goods
purchasing a new building
GO ON TO
01239010/J/CSEC 2020
THE NEXT PAGE
- 12 Item 54 refers to the following information.
J. Baynes Manufacturing Account for the Period Ended 31 December 2017
Inventory of raw materials 1 January 2017
Purchases of raw materials during year
Less closing inventory ofrnw
materials 31 December 2017
I 400
3 900
1 300
900
100
400
200
6 800
Productive wages
Fuel and power
Lubricants
Rent and rates
Insurance
54.
$
800
4 500
5 300
$
Balance cnnied forward
6 800
6 800
What is the cost ofthe raw materials consumed?
(A)
(B)
(C)
(D)
$ 800
$1 200
$3 900
$4 500
ltem 55 refers to the following table which shows balances of the asset accounts of the Bayroe
Club as at 30 June 2019.
Assets
Premises
Equipment
Furniture
Bank and cash
Inventory and refreshments
55.
$
5400
1 825
960
1 640
72
The amount of the club's accumulated fund was
(A)
(B)
(C)
(D)
$1 640
$4 497
$8 185
$9 897
0123901 O/J/CSEC 2020
GO ON TO THE NEXT PAGE
- 13 Salaries paid to the administrative staff in
a factory would be classified as which of
56.
Item 59 refers to the following list of
balances.
the following types of cost?
Manufacturin g
(A)
Work in progress 1 January
Work in progress 31 December
Indirect
(B)
(C)
Direct
Prime
(D)
Cost of materials used
Indirect expenses
Factory wages
57.
When a company declares a dividend of
59.
15o/o the dividend warrant of a sharcholder
ownin
� isoo one-dollal' ordinary shares is
'
(A)-.
$
�)
$ 225
(B)
(C)
$1 515
(D)
(G) - - $1 500
(D) ..
Using the list of balances above, what is
the cost of goods produced?
(A)
100
$
600
700
000
200
s 000
1
1
3
3
$
$
$
$
8 000
8 700
11 100
11 200
-J ��.....
'
Prime cost is $79 110, office expenses
$3 000 and factory overheads $4 720. How
58.
60.
a week, he worked his basic week of
ID}!Ch is the cost of production?
.(i)
.
$
.
40 hours. The income tax due on his pay
is $20, and he is also liable to pay national
insurance contributions of 5% of his gross
4 720
\GQ) ".-. �71390
(C) � -
•:'
7'(D)
.
-·
pay. What is his net pay?
�83 830
$86 830
:_
(A)
,
.
(B)
t'.. . .. . .:'1 "";
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. .
-.
..
, ·.,,
.·
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..
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P. Amos is employed by a construction
company at a rate of $7 per hour. During
(C)
(D)
I
$246
$260
$266
$280
:. ..
-.
. . \
END OFTEST
IF YOU FINISH BEFORE T IME IS CALLED, CHECK YOUR WORK ON TIDS TEST.
.
01239010/J/CSEC 2020