Tsun Jin High School

Second Semester Final Examination 2021

Senior Middle Two
BOOKKEEPING AND ACCOUNTS

Date: 25 October 2021

Time: 8:00 a.m. — 10:00 a.m. (2 hours)
Scope: Manufacturing Account,
Incomplete Records,
Inventory Valuation and Inventory Loss.

INSTRUCTIONS TO CANDIDATES

① This subject comprises two parts:

PART A: Multiple-Choice Questions (10%)
All together 10 questions to be answered in google form link.

PART B: Subjective Questions (90%)

Attempt ALL the four questions.
(Answered in the foolscap papers prepared by yourself)

② Do not copy the questions, but the answer to each question should be clearly numbered.

③ Workings must be shown where necessary; otherwise marks for method may be lost.

④ Use only blue or black ink for writing.

⑤ Electronic calculators may be used for calculation.

⑥ Arrange the answer scripts in numerical order and use Cam Scanner apps to take photo and
save it in a pdf file.

⑦ Name the file as below and upload your file into the google classroom.
o ClassNumber_Class_EnglishName_SubjectTitle.pdf
o Example: 40_S2C8_LucaPacioli_BK.pdf

⑧ This paper consists of 8 printed pages.

DO NOT TURN OVER THIS PAGE UNTIL YOU ARE TOLD TO DO SO

COPYRIGHT RESERVED

(Name: __________________________ ( ) Class: S2C___ )

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Section A: Multiple-Choice Questions (10%)

1. Which of the following is treated as prime cost in a chair manufacturing company?

I Nails to make a chair
II Hammer and drill to produce a chair
III Machine operators’ wages
IV Subcontract cost related to production goods

A I, II, III B I, II, IV

C I, III, IV D I, II, III, IV

2. Woods used in manufacturing a chair is:

A Prime cost B Direct material

C Indirect material D Factory overhead

3. In a manufacturing business, where should the cost of delivering the completed goods to
customers be shown?
A Prime cost
B Factory overhead expenses
C Trading account
D Profit And Loss account

4. Which of the following is shown in a Statement Of Affairs?

A Sales – Cost Of Sales
B Sales + Purchases
C Assets – Liabilities
D Income – Expenses

5. When the closing inventory value has been overstated by RM 1,000 and the opening inventory was
understated by RM600. What will be the effect on gross profit?
A Overstated by RM 400
B Understated by RM 400
C Overstated by RM 1,600
D Understated by RM 1,600

6. If sales are RM 240,000 and the gross profit mark-up is 33 1/3%. What is the gross profit?
A RM 48,000 B RM 60,000
C RM 80,000 D RM 90,000

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7. A business values its inventory of items X and Y, with the following condition:
Item Quantity Cost Price Per Unit Net Realisable Value Per Unit
X 500 units RM 2.80 RM 2.00
Y 900 units RM 0.50 RM 1.20

It was found that:

i. another 5 units of X are on a sales or return basis;
ii. 100 units of item Y were damaged and were unsaleable.
What is the total value of the inventory?
A RM 1,450
B RM 1,410
C RM 1,400
D RM 1,390

8. On 21 November 2018, a fire broke out and destroyed the entire inventory at Paul’s
warehouse. The following information was available from the accounting records:

Sales from 1 November to 21 November RM 900,000

Purchases from 1 November to 21 November RM 600,000
Inventory at 1 November RM 200,000

Based on the recent history, Paul had a gross profit of 30% of sales. What is the value of the
inventory loss?
A RM 70,000 B RM 170,000
C RM 530,000 D RM 800,000

9. X and Y agree to admit Z into partnership, the premium is only paid to Y directly. How do you
treat the premium?
A No entry is required
B It is to be entered in Partnership’s Bank account
C It is to be retained for business use
D It is to be recorded in both partners’ Capital accounts

10. When a new partner is admitted, if the actual value of an asset of the partnership is lower than
the carrying value, how should this revaluation of the asset be treated?
A It is debited to the capital accounts of old partners
B It is credited to the capital accounts of old partners
C It is debited to the capital accounts of new and old partners
D It is credited to the capital accounts of new and old partners

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Section B: Written Questions (90%)
Question 1
Kimmy has seven lines of inventory items in the business. At 31 January 2021, the following
information is available regarding its inventory:

Inventory Types Quantity Cost per unit Selling Price per unit
RM RM
Type 1 40 31 33
Type 2 71 35 42
Type 3 43 12 20
Type 4 22 40 44
Type 5 10 78 76
Type 6 25 61 67
Type 7 28 19 24

Additional information:
① Inventory Type 1 has now obsolete and were unable to resale.
② Inventory Type 2 needs additional cost of RM 10 per unit to be incurred in bringing the inventory
to saleable condition.
③ The inventory count including 10 units of inventory Type 3 bought in cash basis.
④ 20 units of inventory Type 4 are presently at a customer’s premises on a sale or return basis.
⑤ 5 units of inventory Type 5 has been omitted from the inventory count sheet.
⑥ All inventories of Type 6 has been invoiced to the customer and awaiting for collection.
⑦ The inventory count sheet consists of 3 samples item provided by the supplier for marketing
purpose. They are to be considered as unsold items.

You are required to prepare a statement to calculate the value of Kimmy’s inventory at 31 January
2021.

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Question 2
The accounting year of Flexi Bhd ended on 31 December. The physical stocktaking for the
reporting period valued the company inventory at cost RM 17,700.

On the evening of 7 January 2021 a fire occurred in the warehouse.

The following transactions took place during the first week of January 2021:

1 January 2021 7 January 2021

RM RM
Accounts Payable 12,500 12,000
Accounts Receivable 8,000 7,300
Inventory as valued 17,700 27,200

For the period 1 January to 7 January 2021:

RM
Cash received from debtors 25,300
Discounts received 600
Discounts allowed 400
Payments to creditors 39,900

The company sold all its goods at a gross profit margin of 20%.

You are required to prepare a statement showing the value of the inventory destroyed by fire on
the date.
(All necessary workings must be shown)

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Question 3
Jason owns and manages a food manufacturing business. The balances extracted from the
books of the business at 31 August 2020 is as follows:
RM
Plant and Machinery, at cost 300,000
Furniture and Fittings, at cost 300,000
Accumulated Depreciation of Plant and Machinery 60,000
Accumulated Depreciation of Furniture and Fittings 60,000
Inventory, 1 September 2019:
Raw Materials 13,000
Work-In-Progress, at prime cost 5,500
Finished Goods 20,000
Factory Loose Tools 800
Sales of Finished Goods 1,000,000
Purchases – Raw Materials 92,000
– Finished Goods 4,000
– Factory Loose Tools 1,980
Raw Material Returns 3,000
Royalties 16,000
Wages (direct 40%; indirect 60%) 8,000
Factory Rental 36,008
Factory Insurance 19,136
Selling and Distribution Expenses 35,000
Inventory, 31 August 2020:
Raw Materials 17,400
Work-In-Progress, at prime cost 3,500
Finished Goods 18,000
Factory Loose Tools 1,380

Additional information:
① Accrued direct wages amounted to RM 800.

② Part of the insurance paid amounted to RM 3,600 is the insurance that had been paid until
31 December 2020.

③ Depreciation is to be provided for plant and machinery at 20% per annum on cost.
Depreciation for furniture and fittings at 5% per annum on carrying value.

④ Two-month rental deposit mistakenly included in the Factory Rental account.

⑤ Owner withdrew flour amounted to RM 2,000 from the factory warehouse for private use.

⑥ Custom duties is to be calculated as 20% of net purchase of raw materials.

⑦ Finished goods were transferred to the Trading Account at cost plus 20%.

You are required to prepare a Manufacturing Account for the year ended 31 August 2020.
(All necessary workings must be shown)

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Question 4

Jimmy runs a retail business. He does not keep double entry accounting records and the following
information is available:

Assets and liabilities were as follows:

1 January 2020 31 December 2020
RM RM
Office Equipment (cost RM 38,000) 35,000 ?
8% Loan From Bank 10,000 ?
Accounts Receivable 9,000 10,000
Accounts Payable 7,000 6,000
Cash at Bank 14,250 ?
Cash in Hand 500 500
Accrued Wages and Salaries ⸻ 500
Allowance For Doubtful Debts 250 ?
Inventory 8,800 7,700

Bank transactions for the year ended 31 December 2020:

Summary Of Bank
RM RM
7% Loan From Bank 10,000 Loan Interest 1,200
Cash – sales banked in ? Fixed Deposit (1 June) 4,000
Accounts Receivable 21,000 Purchases 8,300
Sales – cheques 5,000 Accounts Payable 15,700
Office Equipment (31 January) 10,000
Drawings ?
Wages And Salaries 2,300

Addition information:
① Fixed deposit interest 9% per annum.
② Owner used own money to pay accounts payable amounted to RM 2,500 after sold of his
personal car.

③ Purchase of goods amounted to RM 500 and payment of salaries and wages amounted to
RM 1,000 were paid from cash sales. The balance of cash sales amounted to RM 1,900
later credited into the business’s current account.

④ Office equipment is to be depreciated by 9% using reducing balance method.

⑤ Cash drawings amounted to RM 50 per week.

⑥ Wages and Salaries: 40% Wages, 60% Salaries.
⑦ Other information:
i. RM 430 Goods returned from customers
ii. RM 300 Discounts to customers
iii. RM 400 Discounts from suppliers
iv. RM 200 Irrecoverable debts
v. Allowance For Doubtful Debts of 5% was provided.

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You are required to prepare the following accounts and financial statements:
a) Accounts Receivable and Sales;
b) Accounts Payable and Purchases;
c) Cash;
d) Income Statement for the year ended 31 December 2020;
e) Statement Of Financial Position as at 31 December 2020.

(All necessary workings must be shown)