2012 GCE O’ Level Principles of Accounts (POA) Suggested Solutions!

After hearing that Miss Loi’s Joss Sticks website crashed even before E MathsPaper 2 solutions were out,

I wondered if we had to do backups to avoid the same fate… except that I’m reminded that POA is taken by only approximately 20% of the cohort. 😉

So I have 1/5 the same risk. 😉

The weekend was abuzz with activity at YMCA, where we had the largest party turnout for the annual crash course over two days.

Predicted topics include doubtful debts, liquidity, profitability, partnership, control accounts, bank recon, amalgamation, control accounts, correction of errors and incomplete records.

75% of the Sample Paper 1 & 2 collectively came out in this year’s paper. Much to our delight. 🙂

And without further ado…. we present,

RE-UPed Version 2 with contributions from commentators.

7092/01 GCE O’ Level Principles of Accounts 2012 Paper 1 Suggested Solutions

7092/02 GCE O’ Level Principles of Accounts 2012 Paper 2 Suggested Solutions

Right Click on Each Link And “SAVE AS.” File size may be quite big, so be patient.

 

 

Caleb’s Comments

THEORY

Paper 1  – 17 marks

Paper 2  – 16marks.

Total        33 marks.

This is fairly consistent with 2011 paper (32-34 marks, depends on which question you chose for Section B for Paper 2).

Student’s ability to make comparison on performance and liquidity of business (consisting 15 marks of 33) should excel in this year’s papers.

ACCOUNTS & APPLICATION

Paper 1

Students complain the paper was too easy.

Working capital was a generous 5 marks. Complacency might have killed those who failed to show workings. The instruction was extremely clear. I hope you caught that and did accordingly.

Paper 2

U NO BALANCE NO?

This year’s Paper 2 had some notably challenging questions. I am happy that challenging questions which require understanding and application came out so that deserving students can get a decent shot of doing well.

P2 Q1 NP figure is $28,250. Balance Sheet $83,320.

Student’s ability to account for Decrease in Doubtful Debts, Bank Charges (Dr Bank Charges and Cr Bank) and setting Surjit’s $150 dr balance as negative in the balance sheet were perceived to be differentiators of those who do well and those who will excel.

P2 Q4 Tests the student’s ability to calculate depreciation using NBV figures of fixed assets.

P2 Q5 Bad Debts Recovery T-account was asked for the first time. Dates and remembering to transfer it to Profit and Loss are the two major landmines to watch out.

P2 Q5 Capital Account – Students must know to put the right details in the Capital account for additional capital contributed and Drawings made.

Discussing Answers Online. 

Constructive comparison to achieve understanding is fine.

However, I’m no genie. This remains as Suggested Solutions.

I’ll be happy to stand corrected and update the document from your contributions. 🙂

Please don’t ask me if this or that mistake will cost me 1 or 2 marks. Your guess is as good as mine.

Errors can be carried forward and will not be marked down twice, provided you showed workings for the remaining figures. It amazes me constantly that students take workings, dates and details for granted.

Concluding Thoughts

Of course I’ll say I wish you guys, especially my students, the very best grades and may getting your As and Bs help you advance in your academic journey towards the next step. Suffice to say, I’ll end by sharing with you a note by Tong Yee, director of The Thought Collective, for his batch of General Paper students.

“My Last Lesson to You: For the Batch of 2012” (FaceBook note)

It deeply resonates with my heartbeat as an accounting educator. My wish is that the accounting knowledge you learn in POA help you understand and appreciate in future the volatile financial landscape we are in and develop skills to cope with challenges and overcome them with good, critical thinking.

With that, all the best for your remaining papers!

Cheers,

  • 2407

    Hello, i would like to check some answer.
    Paper 1 – Q3 (a) (i)Dr Bad debts
                                   Cr Debtors
                               Being bad debts written off
                  
                             Dr Profit and loss
                                   Cr Bad debts
                          Being bad debts transferred to Profit and Loss
     
    Do we have to include the 2nd part about profit and loss as well? This goes the same for part (a) (ii).

     Q3 (b) Balance sheet question – the debtors should have minus the bad debts as well

  • Daniel

    Hi Caleb, i forgot some of the question in paper 1. Do u have a copy of the paper?

  • 2407

    As for paper 2 – Q3 (a) i suppose all answer must be in 2d.p as the question specifically say ‘each calculation to 2d.p’ . So gross profit should be 32,000.00.

    Q4(b) – General expenses should be $16,400. The 500 prepaid should be calculated as a postive number not a negative number.

    Q5(a) – Error no.6 – Sale decrease, so gross profit and net profit will decease, so i suppose it will be a Less: instead of Add:

  • 123456

    For qn5,part 6) I though the correct entries shd be debit cash/bank , credit Machine? Since it is posted to sales( error of princple), ‘sales’ should be corrected by debiting it. That means a decrease in NP. Am I wrong?

    Next, why net profit excluded from our capital account ?

  • daniel

    thanks for the answer!!!

  • 2407

     I did question 5 on the question paper and i got my capital balance as $89,350.

  • guest

    $82400 here. Balance c/d to balance b/d next month was $79600

  • 2407

    This is how i get $88,350.. sorry my answer is 88,350, typo.
    50,000 – (1800 + 1000) + 6,000 + (24% x 110,000) + 8750

  • guest

    Drawings should be $2800 for capital account in Q5. You forgot repairs

  • Jonabee

    Qns 5 corrected net profit should be $8500 right?
    Capital b/d should be 88100. It’s dr bad debts not cr bad debts.

  • guest

    No need to add net profit. Only drawings and capital will affect

  • Jonabee

    Qns 2ci) should be revenue expenditure because printing business name is part of advertising which appear in pnl

  • guest

    we have the same net profit 8750

  • 2407

     really? i didnt know that.. then it will be 79,600 then.
    Do eu know why net profit is not included? i would like to know.

  • Guest2

    addition of net profit is under owner’s capital, not capital account in this case

  • 2407

    understood. thanks!

  • karpy

    agree + part of normal day-to-day operations of the business.

  • Javin

    printing business name on motor vehicle shows that it last for more than 1 accounting period so it should be capital expenditure

  • ZhL

    Error: The balance sheet: prov. for depreciation of training equipment is 5440+6000 = 11440? you calculated 12240

  • Hellokitty95love

    Why must we use 1706 to minus bad debts instead of 1056? 1706 is the amount that Debtor EC owed but he paid $704. this would also mean that $1056 is considered as a bad debts, even though the answers are in decimal place? no? do assist thankyou!

  • ZhL

    Oh its 6800! Ps.

  • 2407

    If i remember correctly, it should be 6,800 in the question paper?

  • 817394681

    Cos the debtor paid 704 by cheque. So that will also reduce the debtor. so you have to deduct it together with your bad debts

  • Hellokitty95love

    but 1706 – 704 is the bad debts of Debtor right? no ?

  • hkxhsibdsk

    In overall, u need to deduct the amt that reduce your debtor. Indeed bad debts u need to deduct from debtors, but what about the cheQue the debtor have issued? it also reduce the amt in your debtor right? so overall u need to deduct the $1760 from debtors too

  • Angelicrys37

    For question 3c mary’s stock turnover is faster than soo leh.

  • Aaron

    For the Bad Debts Paper 1 Q3c: Should be Debtors : 63 300 [after minus (i) and (ii) ], Less Provision for DD :3798 right ?

  • wee

    paper 2:
    for qn 4, the TPL, shouldnt the General expenses be $500+300+15600? cause the $500 is part of the expenses of the accounting period since it is prepaid. 

  • justin

    That’s what I thought of too :/

  • Agatha

    Hi! For Paper 2 question 5, error number 6:
    I agree is Dr. Sales and Cr. Machine

    For part (a) amendment for net profit should be LESS $2800 not ADD?

  • John

     Yes, you have to minus the bad debts off from debtors and then minus the final debtors with doubtful debts.

    So the answer is $63300 – $3798 = $59502.

  • calebho

    Hi Daniel, 
    Thanks for the note. The paper cannot be uploaded due to copyright reasons. 🙂

  • calebho

    Hi 2407,

    I’ll do my best to answer your query here:

    On decimal places, do a little Googling and you can find some marking guidelines for O level accounting marking: 

    Extract:

    •      Where a calculation is to be shown to two decimal places, an answer rounded up or down may be accepted (e.g. 2.85 or 2.86 if the true answer is 2.853) but not an answer shown to only the nearest whole number or one decimal place (e.g. 2.8 or 3).
    •      Where dollars and cents are shown in a question and exact cents are required in a calculated answer (e.g. $35.60) many candidates will show $35.6 as their calculators will suppress the final 0. Although wrong this may be accepted.

    From point one, $32,000 or $32,000.00 will be correct.

    Q4 (b) – You are correct. I stand corrected. Will update the answers.

    Q5 (a) – Yes, you are right again. I got it right in the working but missed it in the ans. 

    Thanks for your contribution!

     

  • calebho

    Yes, karpy! Thanks. You are absolutely right. 
    Will update. 🙂

  • calebho

    Hi Jonabee and karpy,

    I beg to differ. A business doesn’t print business’s name on new delivery vehicle every year. 

    Something similar came out for N levels this year – a fast food restaurant gets a new sign for the restaurant, C or R exp?

    See exchange: http://www.principlesofaccounts.com.sg/2012-gce-n-levels-principles-of-accounts-poa-suggested-solutions/ 

  • calebho

    bad eyesight. i mixed the names up for this one. paiseh. 

  • calebho

    Yes. I stand corrected. see update soon. 🙂

  • calebho

    yes, Agatha! error of transfer. 🙁 
    will update!

  • calebho

    thanks John, absolutely!

  • calebho

    hi hellokitty95love and justin,

    see hkxhsibdsk and 817394681’s explaination above. it’s correct. debtor paid 704. so debtor figure reduce by 704 too. 🙂

  • calebho

    Hi 2407,

    You rightly applied the concept that General Journals are used for closing/adjusting balances. But this question doesn’t require you to do adjusting entires. So the 2nd part about the profit and loss is not required. 

    However, u caught me there. question requires only to record 2i) and 2ii). 
    Tricky for those who did journal entries for part 3. 

    Q3 (b). Yes. I missed that out. 

    Thanks again!

  • calebho

    2407 is right again. 🙂

    Ending Cap = Beginning Cap + Additional Cap + Net Profit – Drawings.

    The business owner keeps the moolah at the end of the year. 🙂

  • calebho

    2407 is right again. 🙂
    Ending Cap = Beginning Cap + Additional Cap + Net Profit – Drawings.

    The business owner keeps the moolah at the end of the year. 🙂

  • calebho

    2407 is right again. 🙂
    Ending Cap = Beginning Cap + Additional Cap + Net Profit – Drawings.

    The business owner keeps the moolah at the end of the year. 🙂

  • calebho

    Corrected NP is $8750. It’s Cr Recovery of Bad Debts (an income account). Bad debt was previously written off as expense. when recovered, treated as other income.

  • Cktan25

    why can’t see/download paper 2 ?!?!

  • 2407

    i think you updated the wrong answer for paper 2 last question. 

  • 2407

     oh okay, thanks for your explanation.
    look like i got quite a few marks deduced for writing too much.

  • Hjlthatsme

    Hey there, really appreciate your efforts in posting the answers for us O-level poa students. Could you re-up the answers for paper 2? For question 5 part b regarding the bad debts recovered and part c regarding the capital account theres no answer. Thanks in advance. Cheers

  • Google

    I can’t see question 5 though.