FINANCIAL ACCOUNTING 3

7005

CAMEROON GENERAL CERTIFICATE OF EDUCATION BOARD

Technical and Vocational Education Examination

JUNE XXXX ADVANCED LEVEL

Specialty Name ACCOUNTING
(Specialty Code) ACC (CG)
Subject Title FINANCIAL ACCOUNTING
Paper No. 3
Subject Code No. 7005

One and a half hours

INSTRUCTIONS TO CANDIDATES

Answer Question ONE and TWO others.

Calculators are allowed.

You must use ONLY Blue or Black ink. No answer in Pencil will be marked.

All Appendices filled or completed should be handed in with your answer booklet and must be put in the appropriate
answered number.

All necessary calculations must be shown.

You are reminded of the necessity for good English and orderly presentation in your answers.

You are advised to read carefully through the question paper, before you begin your answers.

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© 2019 CGCEB

1. The following Trail Balance was extracted from the books of EWELI PLC as at 31/12/2019.

Elements DR.CFAF CR. CFAF

Share capital 61,820,000

purchases 46,000,000
Sales 98,000,000
Sales return 808,000
Purchase return 280,000
Discounts 910,000 704,000
Rent and rates 4,230,000
General expenses 5,160,000
Trade debtors 1,8,400,000
Trade creditors 16,000,000
Cash in hand 4,200,000
Stock 01/01/2019 6,100,000
Plant and machinery 61,500,000
Provision for plant and machinery 2,000,000
Motor vehicle 28,000,000
General reserve 96,000
Profit B/F 408,000
Motor expense 4,000,000
Total 179,308,000 179,308,000

Notes
i) Stock in trade on 31/12/2019 was valued at 7,420,000 CFAF
ii) Rates paid in advance on 31/12/2019 amounted to 450,000 CFAF,
iii) General expense outstanding 240,000 CFAF
iv) Depreciation is calculated on plant and machinery at 5 % on reducing balance method and motor vehicle
10 % on cost.
v) Provision for doubtful debts 8 % on debtors figure
vi) The directors recommend 2,000,000 CFAF on general reserve and 5 % on share capital for dividend to
shareholders.
Required: For internal use,
a) Prepare EWELI Plc statement of profit and loss for the year ended 31/12/2019 (16 Marks)
b) Prepare the statement of financial position as at 31/12/2019 for EWELI PLC . (14 Marks)

Vertical format of presentation only. (Total 30 Marks)

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2. WASE, a sole trader who keeps incomplete records, has provided you with the following balances on 01/01/2018:
CFAF
- Equipment 15,000,000
- Stock 2,000,000
- Trade creditors 800,000
- Trade debtors 500,000
- Bank overdraft 700,000
All business takings are deposited in the bank account daily. The following receipts and payments are traced from
the bank account during the year 2018:
- Bank receipts
 Trade debtors 1,200,000
 Sales 3,000,000
- Bank payments
 Trade creditors 1,000,000
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 Purchases 1,800,000
 Rents and rates 300,000
On 31/12/2018, the following balances are available:
- Equipment 12,000,000
- Stock 2,500,000
- Trade creditors 900,000
- Trade debtors 700,000
- Bank 400,000
Required:
a) Prepare a statement of affairs as at 01/01/2018 to show the capital at start. (9 marks)
b) Determine the total amount of sales and purchases made by WASE for the year 2018. (6 marks)
c) Prepare a statement of comprehensive income for the year ended 31/12/2018 and a statement of financial
position as at 31/12/2018. (20 marks)
(Total 35 marks)
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3. The following are extracts from the final account of a trading company over its last two years:
Profit & loss statement
ELEMENTS Year 1 (000 CFAF) Year 2 (000 CFAF)
Purchases (all on credit) 216,000 285,000
Sales (all on credit) 675,000 834,000
Cost of sales 210,000 272,000
Gross profit 465,000 562,000
Net profit 130,000 200,000

Statement of financial position data

YEAR 1 YEAR 2
CFAF CFAF CFAF CFAF
Non-current assets 620,000 800,000
Current asset;
Inventories 11,000 24,000
Debtors 95,000 106,000
Total current assets 106,000 130,000
Current liabilities;
Trade creditors 28,000 (39,000)
Bank overdraft 39,000 (77,000)
Taxation 10,000 (20,000)
Proposed dividend 25,000 (30,000)
Total current liabilities (102,000) (166,000)
Working capital 4,000 (36,000)
Capital employed 624,000 764,000
Financed by:
Share Capital 300,000 300,000
Retained profit 224,000 374,000
524,000 674,000
Long term liability: Mortgage 100,000 90,000
624,000 764,000
NOTE: stock at the beginning of year 1 is the closing stock of the same year.

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Required
a) Calculate two profitability ratios for both years. (10 Marks )
b) Calculate two liquidity ratios for both years (10 Marks)
c) Calculate two efficiency ratios for both years (10 Marks)
d) Briefly comment on the financial performance of the company over the two years.
(5 Marks)
(Total 35 marks)
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4. The balance sheet of upper House Plc is given below

2017 2018
CFAF CFAF CFAF CFAF
Trade mark 4,000
Office equipment 30,000 32,800
Stock 15,000 15,500
Debtors 6,000 7,000
Cash 14,000 35,000 19,580 42,080
TOTAL ASSET 65,000 78,880
Financed By:
Share capital 35,000 55,000
Reserves 5,000 6,050
Profit retained 7,000 3,830
Loan 10,000 5,000
Creditors 8,000 9,000
TOTAL LIABILITIES 65,000 78,880

Notes:
Profit and Loss for 2017 was distributed as follows:
- general reserves 1,050,000 CFAF and dividend paid and proposed 5,590,000 CFAF
- Depreciation for 2018 amounted to 5,300,000 CFAF.
- During 2018 office equipment was bought for 15,000,000 CFAF cash. Also office equipment was sold for cash
7,500,000 CFAF with original value worth 10,000,000 CFAF and accumulated depreciation of 3,100,000 CFAF.
- There was an issue of shares which was paid by cash.
Required:
Prepare a cash flow statement for Upper House Plc as at 31/12/2018 as requires by IAS7. (35 Marks)
(Total 35 marks)

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