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    22 views4 pages

    4.4 Answers

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    Cambridge IGCSE and O Level Accounting

    Worksheet 4.4 answers

    1 Closing capital + Drawings − Opening capital = Profit

    Closing capital − Opening capital + Drawings − Capital introduced = Profit

    2 a Opening Capital Profit/ Drawings Goods taken Closing


    capital introduced loss for own use capital
    $ $ $ $ $ $
    12 960 0 780 0 0 13 740
    33 480 0 7 230 6 250 0 34 460
    49 340 0 12 710 8 670 2 800 50 580
    69 750 5 500 (4270) 8 300 3 100 59 580

    b
    Capital account
    Date Details $ Date Details $
    Drawings 8 300 Balance    
    b/d 69 750
    1
    Purchases 3 100 Bank 5 500
    Loss 4 270
    Balance     c/d 59 580 75 250
    75 250 75 250
    Balance    
    b/d 59 850

    © Cambridge University Press 2018


    Cambridge IGCSE and O Level Accounting

    3 a
    Abi
    Statement of affairs at 1 October 20–4
    $ $
    Assets
    Non-current assets
    Premises at cost 55 000
    Equipment at cost 19 000
    Motor vehicle at cost .  5 000
    79 000
    Current assets
    Inventory 13 600
    Trade receivables 84 500
    18 100

    Total assets 97 100

    Capital and liabilities


    Capital
    Balance 91 105 2

    Current liabilities
    Trade payables 5 100
    Bank overdraft 0 895
    5 995

    Total capital and liabilities 97 100

    © Cambridge University Press 2018


    Cambridge IGCSE and O Level Accounting

    b
    Abi
    Statement of affairs at 30 September 20–5
    $ $
    Assets
    Non-current assets
    Premises at cost 55 000
    Equipment at cost 19 000
    Motor vehicle at cost 05 000
    79 000
    Current assets
    Inventory 15 100
    Trade receivables 5 030
    Bank 01 980
    22 110

    Total assets 101 110

    Capital and liabilities


    3
    Capital
    Balance 96 210

    Current liabilities
    Trade payables 4 900

    Total capital and liabilities 101 110

    c
    Abi
    Calculation of profit for the year ended 30 September 20–5
    $ $
    Capital at 30 September 20–5 96 210
    Less Capital at 1 October 20–4 91 105
    5 105
    Add Drawings – cash 6 500
    goods 2 200 88 700
    13 805
    Less Capital introduced 8 000
    Profit for the year 5 805
    © Cambridge University Press 2018
    Cambridge IGCSE and O Level Accounting

    4 Four from:

    • Full details are available about the assets, liabilities, revenues and
    expenses.

    • The preparation of financial statements is relatively straightforward.

    • The calculation of profit or loss for the year is likely to be more


    reliable and accurate.

    • More informed decision-making is possible.

    • A greater degree of control over business activities can be exercised.

    • The possibility of fraud is reduced.

    • Comparisons with results of previous years and other businesses are


    possible.

    • Detailed records are available for reference purposes.

    • Information required by a bank or lender is readily available. 4

    © Cambridge University Press 2018

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