2017 Accounting-NHT Written examination · 2019-03-04 · 2017 ACCOUNTING EXAM QB (NHT) 2 Question 1 – continued Question 1 (11 marks) The following information relates to Maxi

ACCOUNTINGWritten examination

Tuesday 6 June 2017 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• Questionbookof12pages.• Answerbookof18pages.

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.

©VICTORIANCURRICULUMANDASSESSMENTAUTHORITY2017

Victorian Certificate of Education 2017

2017ACCOUNTINGEXAMQB(NHT) 2

Question 1–continued

Question 1 (11marks)ThefollowinginformationrelatestoMaxiArts,asupplierofartmaterial,forJanuary2017.

Creditorbalancesat1January2017PixelPrinting $14000NDawson 10000ArtsPlus 16 000 $40 000

Journals for January 2017

Purchases Journal

Date2017

Creditor Invoice No.

Stock Control

GST Creditors Control

Jan. 517

GRobertsCanArts

8221437

105008400

1050840

115509240

$18900 $1890 $20790

General Journal (partially completed)

Date2017

Details General Ledger Subsidiary Ledger

Debit Credit Debit Credit

Jan.9

GRoberts 550

Returnedartfolios–CrN.34

Cash Payments Journal

Date 2017

Details Chq. No.

Bank Disc.Rev.

Creditors Control

Wages Sundries GST

Jan. 46

1115172330

OfficeequipmentNDawsonGRobertsWagesDrawingsCanArtsWages

201202203204205206207

77009 800

11 00041002700016 0004175

200 10 00011 000

16 000

4100

4175

7000

27000

700

$79775 $200 $37000 $8275 $34000 $700

3 2017ACCOUNTINGEXAMQB(NHT)

TURN OVER

a. CompletetheGeneralJournalentryon9January. 2marks

b. CompletetheCreditorsControlaccountat31January. Youarerequiredtobalancetheaccount. 4marks

c. PosttherequiredtransactionsintoGRoberts’saccountintheCreditorsSubsidiaryLedger. Youarenotrequiredtobalancetheaccount. 3marks

d. Describewhenthe‘Sundries’columnisusedintheCashPaymentsJournalandprovideanexample. 2marks


Question 2 (5marks)LuxLampscommencedbusinesson1February2017.ThebusinesswilluseaGeneralJournalandspecialjournals,andalsosubsidiaryrecordsfordebtors,creditorsandstock.

On1February2017:• theownercontributed$15000cash• theowneralsocontributedequipmentthatcost$6000(plusGST),buthasanagreedvalueof$4000• amotorvehiclecosting$26000(plusGST)wasboughtoncreditfromMiltonMotors• stockcosting$10000(plusGST)waspurchasedoncreditfromWestImports.Stockwillbemarkedup

by125%• theownernegotiatedabankoverdraftwithWhoBankfor$45000.

PreparetheGeneralJournalentrywiththerelevantitemsrequiredtocommenceadoubleentrysystemon 1February2017.Anarrationisnotrequired.


TURN OVER

Question 3 (10marks)LicoriceLikespaysitsemployeesmonthlyontheninthdayofeachmonthforworkuptoandincludingthatday.Thetotalwagesbillis$2500perday,basedonaseven-dayworkingweek.Thebusinessreportsonamonthlybasis.(Note:Thereare31daysinMarchand30daysinApril.)

a. PreparetheCashPaymentsJournalentryfor9April2017(Chq.No.411). 2marks

b. PreparetheadjustingandclosingentriesintheGeneralJournalfor30April2017. Narrationsarenotrequired. 4marks

c. Iftheadjustingentrywerenotrecorded,explaintheeffectforAprilonthe:• IncomeStatement• BalanceSheet. 4marks



Question 4 (15marks)A2ImportshasprovidedthefollowingpartiallycompletedStockCardfortheTechtelevision.

Stock Card

Product: Tech television Cost Assignment Method: FIFO

Date2017

Details IN OUT BALANCE

Qty Cost Total Qty Cost Total Qty Cost Total

May 1 Balance 10 500 5000

5 Inv.234 10 550 5500 10 500

10 550 10500

Additional information 6May CreditsaleofeightTechtelevisionstoalocalschoolfor$800eachplusGST

(Invoice430)12May CreditpurchaseofsevenTechtelevisionsatacostof$475eachplusGSTand

customsdutyof$350plusGSTonthisinvoice(Invoice644)17May OwnerwithdrewoneTechtelevisionandoneAcetelevisionfromthebusiness

(Memo33)19May ProvidedthreeTechtelevisionstoalocalhospitalinexchangeforadvertising

intheirnewsletter(Memo34)24May CustomerreturnedonefaultyTechtelevisiontothebusiness(CreditNote56)

a. RecordtheadditionalinformationintheStockCardprovided. 5marks

b. Justifythecostpriceenteredfortheseventelevisionspurchasedon12May. 2marks

c. Aphysicalstocktakewasconductedon31Mayandtherewere15Techtelevisionsonhand(Memo35).

PreparetheGeneralJournalentryrequiredtorecordMemo35. Anarrationisrequired. 3marks


TURN OVER

AnewmodeloftheTechtelevision,calledTech2,wasreleasedduringMay2017.Theownerprovidedthefollowinginformationabouttheexistingtelevisionsinstockon31May2017.

Model Estimated selling price Delivery to customers

Techtelevision $400 $40

d. CompletethetableprovidedtoshowtheeffectthatthereleaseofthenewTech2televisionwillhaveontheBalanceSheet. 2marks

e. Withreferencetoonequalitativecharacteristic,explainwhyitwouldbenecessaryfor A2ImportstorecordtheimpactofthereleaseofthenewTech2television. 3marks

2017 ACCOUNTING EXAM QB (NHT) 8

Question 5 (14 marks)Candy Enterprises sells chocolates and lollies. It reports on an annual basis on 30 June each year.On 1 June 2015, Candy Enterprises purchased three mobile phones for the use of the sales staff. Each mobile phone cost $900 (plus GST) and was bought on credit from DigPhones. The mobile phones were depreciated at 40% per annum using the reducing balance method. The business decided to dispose of the mobile phones on 30 June 2016 and received $400 cash for each phone.

a. Show how the following accounts would appear in the General Ledger after all details of the purchase and sale of the mobile phones have been posted:• MobilePhones• AccumulatedDepreciationofMobilePhones• DisposalofMobilePhones

You are not required to balance the accounts. 7 marks

The accountant told the owner that a loss on disposal of a non-current asset results from under-depreciation.

b. Justify the accountant’s statement. 3 marks

c. Describe the impact of loss on disposal on the accounting reports. 3 marks

d. State the journals that would be used to record the disposal of the mobile phones. 1 mark


TURN OVER

Question 6 (14marks)XTTradershasbenchmarkeditselfagainstrecentlypublishedindustryaveragesandhasproducedthefollowingdatafor2016.

Key indicator XT Traders

Industry average

ReturnonOwner’sInvestment 15.4% 17.5%

ReturnonAssets 13.8% 11.6%

StockTurnover 88days 67days

DebtorsTurnover 57days 43days

CreditorsTurnover 28days 35days

WorkingCapitalRatio 2.7:1 1.9:1

QuickAssetRatio 1.4:1 1.2:1

DebtRatio 31% 51%

a. DiscusstheliquidityofXTTraders. 6marks

b. Explainthepurposeofabenchmarkandprovidetwobenchmarksthatthisbusinesscoulduse,otherthanindustryaverages. 4marks

c. Usingtheinformationabove,suggestwhyXTTraders’ReturnonOwner’sInvestmentislowerthantheindustryaveragewhiletheReturnonAssetsishigherthantheindustryaverage. 4marks



Question 7 (22marks)HillsHardwareispreparingitsbudgetsforthethreemonthsending30September2017.Allsalesandpurchasesofstockareoncredit.Thebusinessprovidesthefollowinginformation.

Hills Hardware Assets, Liabilities and Owner’s Equity as at 30 June 2017

Debit Credit

AccruedWages 1 000

AccumulatedDepreciationofEquipment 27000

Bank 4000

Capital 112000

CreditorsControl 15000

DebtorsControl 25000

Equipment 89 000

GSTClearing 3000

PrepaidAdvertising 2000

StockControl 38000

Additional information for the three months ending 30 September 2017• Purchasesofstockoncreditwillbe$21000(plusGST).• ThebusinesswillpurchaseanewcomputersystemoncreditfromACTechnologiesfor

$4000(plusGST)on30August.Paymentisduewithinsixmonths.• Estimated Receipts ReceiptsfromDebtors $85000(nodiscountswillbeofferedforearlypayment) Capital $10000• Estimated Payments Advertising $7000(plusGST) Creditors $23000(includingdiscountrevenueof$500) Wages $24000 AccruedWages $1000 Rent $10000(plusGST) Drawings $9000 AustralianTaxationOffice

(ATO;GST) $3000


TURN OVER

Budgeted Income Statement for the three months ending 30 September 2017Sales 102000LessCostofSales 40000Gross Profit 62000Plus Other RevenueDiscountRevenue 500 62500Less ExpensesWages 24000RentExpense 10000Advertising 8000DepreciationofEquipment 4000 46000Net Profit 16 500

a. PreparetheEstimatedCashFlowsfromOperatingActivitiessectionoftheBudgetedCashFlowStatementforthethreemonthsending30September2017. 7marks

b. ShowhowthefollowingaccountswouldappearintheGeneralLedgerat30September2017:• GSTClearingaccount• Capitalaccount

Youarenotrequiredtobalancetheaccounts. 8marks

c. PreparetheCurrentAssetsandtheCurrentLiabilitiessectionsoftheBudgetedBalanceSheetasat30September2017. 7marks


Question 8 (9marks)XAFurniturebuysandsellsarangeofdesignerfurniture.Itoperatesonthefollowingcreditterms:• suppliers5/15,n/30• customers3/10,n/30

Theownerhasbeenprovidedwiththefollowinginformation.

Creditors Turnover

Debtors Turnover

Stock Turnover

80

70

60

50

40days

30

20

10

02015 2016 2017

year

Turnover ratios for creditors, debtors and stock

a. Usingtheinformationabove,explaintheimplicationsoftheseratiosforthebusiness’cashflow. 3marks

b. Explainthree strategiesthattheownercouldimplementinordertoimprovetheturnoverratiosandcashflow. 6marks

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.

©VICTORIANCURRICULUMANDASSESSMENTAUTHORITY2017

ACCOUNTINGWritten examination

Tuesday 6 June 2017 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 2017

STUDENT NUMBER

Letter

2017ACCOUNTINGEXAMAB(NHT) 2

ThIS pAGE IS BlANK

3 2017ACCOUNTINGEXAMAB(NHT)

TURN OVER

ThIS pAGE IS BlANK


Question 1 –continued

Question 1 (11marks)a. 2marksMaxi ArtsGeneral Journal (partially completed)

Date2017

Details General ledger Subsidiary ledger


Jan.9

GRoberts 550

Returnedartfolios–CrN.34

b. 4marksCreditors Control

Date2017

Cross-reference Amount Date 2017

Cross-reference Amount

Jan.1 Balance 40000

c. 3marksCreditor – G Roberts

Date2017

Cross-reference Amount Date 2017



TURN OVER

d. 2marks

Description

Example

Question 2 (5marks)

Working space

lux lampsGeneral Journal

Date2017





Question 3 (10marks)

Working space

a. 2markslicorice likesCash payments Journal

Date2017

Details Chq.No.

Bank Disc. Rev.

Creditors Control

Wages StockControl

Sundries GST

b. 4marksGeneral Journal

Date2017




TURN OVER

c. 4marks

Income Statement

Balance Sheet


Question 4 (15marks)

Working space

a. 5 marksStock Card

product: Tech television Cost Assignment Method: FIFO

Date2017

Details IN OUT BAlANCE

Qty Cost Total Qty Cost Total Qty Cost Total

May 1 Balance 10 500 5000

5 Inv.234 10 550 5500 10 500

10 550 10500



TURN OVER

b. 2marks

Justification

c. 3marksGeneral Journal

Date2017



d. 2marks

Increase/Decrease/No effect Amount

Assets

liabilities

Owner’s Equity

e. 3marks

Qualitative characteristic

Explanation



Question 5 (14marks)a. 7marks

Working space

Candy EnterprisesGeneral ledger

Mobile phones

Date Cross-reference Amount Date Cross-reference Amount

Accumulated Depreciation of Mobile Phones


Disposal of Mobile Phones



TURN OVER

b. 3marks

Justification

c. 3marks

Description

d. 1mark

Journals




Discussion


TURN OVER

b. 4marks

Explanation

c. 4marks

Suggestion




hills hardwareBudgeted Cash Flow Statement (extract) for the three months ending 30 September 2017

$ $

Estimated Cash Flows from Operating Activities


Question 7–continuedTURN OVER

b. 8markshills hardwareGeneral ledger

GST Clearing

Date2017

Cross-reference Amount Date2017


Capital

Date2017

Cross-reference Amount Date2017



c. 7marks

Working space

hills hardwareBudgeted Balance Sheet (extract) as at 30 September 2017

Current Assets $ Current liabilities $


Question 8 –continuedTURN OVER


Explanation


b. 6marks

Explanation

END OF ANSWER BOOK

Documents

2017 Accounting-NHT Written examination · 2019-03-04 · 2017 ACCOUNTING EXAM QB (NHT) 2 Question 1 – continued Question 1 (11 marks) The following information relates to Maxi