2020 O Level POA Answers Paper 1

Date	Particulars	Dr ($)	Cr($)
	Motor vehicle	20500
	Motor vehicle expense	150
	Cash at bank		20650
or	Motor vehicle	20500
	Cash at bank		20500
	Motor vehicle expense	150
	Cash at bank		150

	Discount allowed	45
	Cash in hand	1455
	Trade receivable-Xavier (1455/97%)		1500

b) The business is assumed to continue indefinitely.

General journal

Date	Particulars	Dr ($)	Cr($)
	Trade receivable, Ming	4950
	Sales Revenue		4950

	Trade receivable J Yin	625
	Trade receivable SYin		625

	Increase by 4950
	No effect

Profit after adjustment = $24,822

(c)

Error of Principle	Record of transaction made in the wrong account which is of different category/class of the correct account
Compensating Errors	Error in computation or recording of a transaction that is offset by an error that is equal and opposite. / Amounts are overstated or understated . Keywords : overstated / understated
CompleteReversal Errors	The double entries made were reversed. Or amounts are debited and credited to the wrong nature.

Statement of financial performance for the year ended 31 August 2020

	$	$
Sales revenue	75180
Less: sales returns	(2700)
Net sales revenue		74180
Less : cost of sales		(45300)
Gross profit		27180

Internal Stakeholders	Information needed	Reason
1. Owners and managers	Profit and liquidity	Need to make decisions on how to plan, control, monitor and operate the business
2. Employees	Profit and cash	1)To evaluate their career prospects with the company2) To know if the business has sufficient cash to pay their salaries3) To know if they can get any bonuses

c) Money Measurement / Monetary theory. Only transactions that can be presented in dollars and cents can be recorded. Reputation, while valuable to a business, cannot be recorded into the books as it is not possible to put a monetary value on them.