TEST CODE 001093/2
TEST CODE 001093/2
FORM TP 23124
May/June 2003
CARIBBEAN EXAMINATIONS COUNCIL
SECONDARY EDUCATION CERTIFICATE
EXAMINATION
PRINCIPLES OF ACCOUNTS
Paper 03/2 - General Proficiency
1 hour
26 MAY 2003 (p.m.)1. Answer ALL questions.
2. Answer the questions on the Answer Sheet provided and return
it.
3. Silent electronic calculators may be used, but ALL necessary
working should be clearly shown.
DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO
Copyright 2002 Caribbean Examinations Council.
All rights reserved.001093/F 2003/2-2-
School Project
The principal at the Southborough Comprehensive High School
decided to convert the school's photocopying activity into a
business operation. Effective September 1, 2001, a charge of $2 per
page was implemented for all copying done on the school's photocopy
machines. Students and teachers
were required to take materials to the photocopy room during the
normal school hours to have them
copied by the machine operator. There was no limit as to the
type and quantity of materials to be
photocopied.
The photocopying room was equipped with:
-One heavy duty photocopy machine costing
$150000
-One small desk copying machine costing
$30 000
-Two tables, each costing
$8000
-Two standing fans, each costing
$5000
-One heavy duty stapling machine costing
$3000
-One large cabinet to store photocopy paper
$9000
-Six layers of shelving costing
$6000
In addition, there is a supply of photocopy ink, paper and a
wide variety of other stationery items.
For the first 3 months of operation the records showed the
following:
Number of pages photocopied
$60000
Purchases of photocopy paper
$20 000
Purchases of photocopy ink
$10000
Purchases of other stationery items
$ 8000
Wages paid to operator
$18000
Electricity and telephone related to the copy room
$ 5000
Rent assigned to the copy room
$ 6000
All purchases were on credit but teachers and students received
no credit. At the end of the three-month
period the value of photocopy paper, ink and other stationery
items on hand amounted to $7 000. It was
decided to depreciate all fixed assets by 10% per year.
GO ON TO THE NEXT PAGE
001093/F 2003/2
-3-
QUESTIONS
1. Identify the fixed assets for the operation.
2. Identify the current assets for the operation.
3. Identify the customers of the operation.
4. What books of original entry are appropriate for this
operation?
5. Suggest THREE types of materials that would be
photocopied.
6. What was the revenue for the first THREE months of
operation?
7. Calculate total purchases for the period.
8. Prepare a list of ALL the expenses identified in the
project.
9. Name TWO items that could be included in "other stationery
items".
10. What is the total depreciation expense on ALL fixed assets
for the three-month period?
11. Prepare a statement to show the profit OR loss on the
operation for the THREE months.
(Include an appropriate heading).
12. What items would appear on the operations Balance Sheet?
13. Who are the possible creditors?
14. Would there be ANY debtors?
15. Identify the stock items related to the operation.
16. Give THREE benefits to the school when the photocopying
activity is treated as a business
operation.
17. Identify TWO other related expenses NOT mentioned in the
case.
18. Show the value of the TWO photocopying machines at the end
of TWO years.
19. Suggest THREE ways of expanding the services of the
photocopy room.
20. Assuming that the trend for the next 9 months of operation
will be NO different from the
trend set in the FIRST 3 months, prepare a statement to show the
profit OR loss on operations
for a full year.
