AS Accounting Unit 4 Past Examination Paper June 2012.

Slides:

Advertisements

Similar presentations

CHAPTER22 CASH FLOW STATEMENTS.

Advertisements

Using Budgets for Planning and Coordination

Introduction to Financial Accounting Unit 6 1 Introduction to Financial Accounting Unit 6 Income Statement – Structure, Categories and Formats.

Chapter9 Profit Planning.

Statement of Cash Flows- First Approach

Profit Planning 4/14/04 Chapter 9. © The McGraw-Hill Companies, Inc., 2003 McGraw-Hill/Irwin Planning and Control Planning -- involves developing objectives.

Ambition in Action. Ambition in Action HEAD TEACHER DEVELOPMENT PROGRAM – FINANCAIL MANAGEMENT.

Profit Planning Chapter 9. © The McGraw-Hill Companies, Inc., 2003 McGraw-Hill/Irwin Planning and Control Planning -- involves developing objectives and.

INVENTORY VALUATION. Inventories generally form one of the largest items in current assets of the companies. Inventory valuation is crucial to income.

Statement of Cash Flows

Questions on Financial Management. Question In your own words, explain the role and importance of financial management to a manufacturer whose objective.

Cost Control Measures for Food Service Operations

Accounts Interpreting Accounts. Key Accounting Documents Public Limited Companies in the UK are required to publish their accounts This will usually consist.

Section 36.2 Financial Aspects of a Business Plan

Financial Statements Business Management.

Money, Money, Money, Money Apparel Development 2 Objective 4.01 Financial Reports.

FINANCE BASIC FACTS. Sources of funds Internal Retained profits Sale of assets Using trade credit Investing surplus cash Reducing inventory External Personal.

THE ENTERPRISE ZONE SKILL BUILD BASIC BUSINESS ACCOUNTING JIM MOULD TEACHING FELLOW SHEFFIELD UNIVERSITY MANAGEMENT SCHOOL MARCH 2010.

IB Business and Management

Creating a Successful Financial Plan

Statements of cash flows

Financial Puzzle FINANCIAL STATEMENTS By PresenterMedia.com PresenterMedia.com.

ENGINEERING ECONOMICS ISE460 SESSION 2 CHAPTER 2, May 28, 2015 Geza P. Bottlik Page 1 OUTLINE Questions? News? Chapter 2 – Financials Chapter 8 - Costs.

Accounting for Executives Week 6 15/4/2010 (Fri) Lecture 6.

Accounting & Financial Analysis 111 Lecture 8 Ratio Analysis, Break-even point.

Financial Planning and Analysis: The Master Budget

Cash flow statement & Break Even Analysis. A statement of cash flows is a financial statement which summarizes cash transactions of a business during.

Break-even L:\BUSINESS\GCE\Unit 2\Break even point.xls.

AS Business Studies Marketing

FINAL ACCOUNTS Trading Account – shows Gross Profit Profit and Loss Account – shows Net Profit Balance Sheet – shows what the business owns and owes and.

Business Finance Costs Break-Even Analysis. Revenue and Costs “Revenue” is income earned by a firm when they sell either the goods it makes or the services.

4-1 Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Chapter 4 Financial Forecasting.

Profit Planning Chapter 8. © The McGraw-Hill Companies, Inc., 2003 McGraw-Hill/Irwin Budget Budget: A detailed plan for acquiring and using financial.

BREAK EVEN ANALYSIS  We use the breakeven analysis to look at the point where we start to make a profit in the business.  Any business wants to make.

Chapter 16 The Financial Plan. Copyright © Houghton Mifflin Company16-2 Overview Estimating sales and capital expenditures Preparing the pro forma income.

A2 Accounting Unit 7 June 2002 Paper AQA Unit 7 Check out your answers.

1 INTRODUCTION TO MANAGERIAL ACCOUNTING Lecture 3 & 4.

Statement of Changes in Financial Position : Cash Flow Statement

Slide 3.1 Pauline Weetman, Financial and Management Accounting, 5 th edition © Pearson Education 2011 Chapter 3 Financial statements from the accounting.

PPTs to accompany Accounting and Bookkeeping Principles and Practice by AAT & David Willis  2011 McGraw-Hill Australia Pty Ltd CHAPTER 12 Maintain inventory.

2.3 How do businesses survive?1 Must prepare a business plan/forward plan (set objectives) to ensure that: Meet customer needs and wants Manage costs effectively.

Management of Working Capital. Balance Sheet A financial statement that summarizes a company's assets, liabilities and shareholders' equity at a specific.

Liquidity 2 lessons covering liquidity. We will look at: a)What is meant by liquidity, measuring and calculating: – Current ratio – Acid test b)Ways to.

BUSS 1 Financial planning: using breakeven analysis to make decisions.

Answer of ch 2 Cash flow. E12-2 Understanding the Computation of Cash Flows from Operating Activities (Indirect Method) Suppose your company sells services.

Cash Flow Forecasting. Lesson objectives Understand what cash flow is and be able to produce a cash flow forecast Learning outcomes To be able to describe.

Chapter 36 Financing the Business Section 36.1 Preparing Financial Documents Section 36.2 Financial Aspect of a Business Plan Section 36.1 Preparing Financial.

Profit Planning Chapter 9. © The McGraw-Hill Companies, Inc., 2003 McGraw-Hill/Irwin What is a budget? It is a detailed plan for acquiring and using financial.

Profit Planning Chapter 9

Finance Citi Funded Entrepreneurship Training Program UNIVERSITY OF DUBAI Dr. Zahi Yaseen.

Financial Management. Purpose of Financial Reports Financial Reports – Summarize financial data over a given period of time (shows if the company made.

MGT601 SME MANAGEMENT. Lesson 24 Aspects of Financial Management.

Accounts. Key Accounting Documents Public Limited Companies in the UK are required to publish their accounts This will usually consist of three key accounting.

Financial Accounts Not for now but later… Some financial disasters to consider, just if you didn’t think the topic was important… Kodak

UNIT 7 Revision. Sources of Finance Source of financeWhat this source of finance is, it’s advantages and disadvantages….. Owner’s funds Retained profits.

Operating Budgets: Non-Manufacturing Budgets

Lesson 15-2 Determining Breakeven

Financial Forecasting

UNIT – III CASH FLOW STATEMENT

Financial Accounting II Lecture 12

A-level Accounting Year 13

5.3 Income statements IGCSE Business Studies

11 FINANCIAL STATEMENTS Section 11.1 Income Statements & Cash Flow

Accounting Fundamentals

Costs, Revenue and Profit

Unit 6 Finance Knowledge Organiser 6 The Role of the Finance Function

RATIO ANALYSIS.

Interpreting Accounts

Presentation transcript:

AS Accounting Unit 4 Past Examination Paper June 2012

By the end of this lesson Have marked your answers to all questions Write notes on areas to improve Decide on three improvement targets

(a) Define the terms ‘break-even point’ and ‘liquid funds’ 1 mark At the break even point, Total revenue equals total costs. No profit is made at the break even point A pure liquid asset is cash..so liquid funds are funds close to cash. Current assets are liquid funds, usually listed in inverse order of liquidity indicating relative closeness to cash 1 mark

(b) Do you agree with Justin or Seeta? Give reasons for your choice 7 marks continued on next slide >>>>>>> 1 mark for your judgement and up to 2 marks for 3 points made First, reasons for Liquid Funds.. Liquid funds needed to pay suppliers promptly otherwise supplies will be threatened Liquid funds needed to pay wages and other production costs, otherwise production will be threatened

(b) Do you agree with Justin or Seeta? Give reasons for your choice Total is7 marks..Judgment 1 mark and points 6 marks 1 mark for your judgement and up to 2 marks for 3 points made Second, reasons for Break-even.. Break-even shows whether the firms sales are covering total costs Is contribution per unit enough to cover fixed costs or should variable costs be lowered or selling price raised Reaching the BEP can be used to set targets which can motivate the workforce

(a) Prepare an extract from the income statement (trading and profit and loss account) for the year ended 31 March 2012 to show the necessary adjustment to manufacturing profit to account for unrealised profit 2 marks

Calculate the value of the inventory (stock) of finished goods held at 31 March 2012 Mental gymnastics needed here because you are being asked to go from opening stock to closing stock and have been given the change in provision to enable you to do this 3 marks Opening stock £12600 at cost..add 20% (£2520) to give £15120 not there yet! Prov (£2520) at start..add £840..gives prov (£3360) at end..and we know the closing provision is 20% of closing inventory..so £3360 x 5 gives £16800

Prepare an extract from the balance sheet at 31 March 2012 to show how the inventory (stock) of finished goods is recorded 4 marks Start with the closing Inventory at cost £ add back the closing provision to show the closing inventory at cost plus 20%

Explain to Lily why it is necessary to adjust for unrealised profit in the financial statements Without an adjustment closing stock (valued at cost plus anticipated profit) would be overvalued and this would overstate profits and not be prudent. 4 marks Cost must be valued at cost or net realisable value whichever is lower (IAS2). Realisation concept says profit should not be taken until the stock has been sold..

Calculate the standard selling price per steering wheel So..work out the cost of one steering wheel and add 40% 6 marks

Calculate the direct labour rate variance Calculate the direct labour efficiency variance 2 marks

Calculate the payback period (in years and months) of the purchase of the robots 5 marks Work out the net cash flow per year (Inflow – Outflow) and see how long it takes to payback £8,000,000

Write a report to the directors of R H Wheels Ltd recommending whether the purchase of robots should go ahead. Make reference to both financial and nonfinancial considerations in your recommendation. 10 marks for points above plus 1 mark for recommendation and further 1 for reason

Prepare a contribution statement showing the maximum profit achievable with the limited labour hours available 5 marks This is a limiting or key factor question so apply you 5 steps to work out the optimum way to rank the 3 products See next slide>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

5 marks

Calculate the annual profit/loss under Option 1 5 marks

Calculate the annual profit/loss if the deficit stock is bought in (option 2) 5 marks So Option 1 would bring in an extra £ and Option 2 £

Recommend which option Stuart should use to meet total demand. Give reasons for your choice 5 marks for points above plus 1 mark for recommendation and further 1 for reason