You are on page 1of 5

TEST CODE 001093/2

FORM TP 22142

MAY/JUNE 2002

C AR I B B E AN E X AM I N AT I O N S C O U N C I L
SECONDARY EDUCATION CERTIFICATE
EXAMINATION
PRINCIPLES OF ACCOUNTS
Paper 03/2 General Proficiency
1 hours
10 JUNE 2002 (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 2000 Caribbean Examinations Council.
All rights reserved.
001093/F 2002/2

-2The Woodwork Shop at Gutters Technical High School was opened in September 1997, in order
to achieve three main objectives:
(i)

To provide students with a practical hands on experience in the principles and practice of
woodwork.

(ii)

To allow some students the opportunity to earn as they learn.

(iii)

To provide cost savings for the school.

During the first four years, the main activities in the workshop included:
(a)
(b)
(c)
(d)
(e)
(f)

Repairs to chairs and desks for classrooms


Making wooden savings boxes
Repairs to office tables
Repairs to doors
Canteen cupboards manufacture and repairs
Miscellaneous

In September 1997, the government through the Ministry of Education, bought all the machinery
for the workshop at a cost of $100 000, the tools at a cost of $40 000, and work benches at a cost
of $30 000.
Materials purchased and used each year by the school included:

Lumber
Plywood
Sanding paper
Glue
Nails
Varnish
Screws
Miscellaneous

1997

1998

1999

2000

$18 000
9 000
800
700
300
1 500
500
1 000

$20 000
10 000
1 000
800
400
1 800
800
1 000

$24 000
12 000
1 000
800
400
2 000
1 000
1 200

$28 000
14 000
1 200
900
400
2 200
1 100
1 200

It is estimated that the workshop saved the school the following in EACH of the four years:
Year
1997
1998
1999
2000

Amount saved
$
250 000
268 000
275 000
284 000

GO ON TO THE NEXT PAGE


001093/F 2002/2

-3In addition, the sales of savings boxes were as follows:


1997
1998
1999
2000

$
15 000
18 000
20 000
24 000

Students received 60% of saving box sales.


In order to determine the full cost of operating the workshop, all the fixed assets are depreciated
at a rate of 10% on the straight line basis. The woodwork teacher/supervisor has calculated his
annual salary at $120 000. All other costs of operating the woodwork shop for each of the four
years were as follows:
1997
1998
1999
2000

$
25 000
28 000
30 000
32 000

Additional information
(i)

Note that ALL other costs exclude materials purchased, depreciation and
teacher/supervisory salary.

(ii)

Note that the calculation of revenue for the workshop MUST include savings to the
school.

(iii)

Note that amounts received by students are NOT treated as expenses.

GO ON TO THE NEXT PAGE


001093/F 2002/2

-4QUESTIONS
1.

List the fixed assets mentioned in the case.

2.

List the current assets mentioned in the case.

3.

Name TWO other activities which could take place in the workshop in the future.

4.

Show the total revenue for EACH of the four years.

5.

What is the depreciation expense EACH year?

6.

Calculate the total cost of operating the workshop in EACH of the four years.

7.

How much profit is made each YEAR?

8.

Identify FOUR other costs/expenses of operating the workshop NOT mentioned in the
case.

9.

Show the amount received by students from savings box sales in EACH of the four years.

10.

Based on the information given which of the objectives were met over the period?

11.

Express lumber cost as a percentage of total materials cost in EACH of the four years.

12.

Name TWO basic accounting documents which are used by the school in relation to the
operation of the workshop.

13.

Name THREE original books of accounts relevant to the workshop operations.

14.

Name TWO activities of the workshop to which manufacturing accounts can be applied.

15.

Prepare a statement to show the Financial Performance of the Woodwork shop for EACH
of the first four years and in total including an appropriate heading.

16.

What percentage of the total revenue (savings & sales) was achieved in the year 2000?

17.

Which year made the largest contribution to total profit?

18.

Express total teachers salary as a percentage of total expenses.

19.

What is the net book value of workshop machinery after four years?

20.

What is the accumulated depreciation on tools after four years?


END OF TEST