Jun 03, 2017 Assignments

Describe the money measurement concept and state its limitations.

This paper concentrates on the primary theme of Describe the money measurement concept and state its limitations. in which you have to explain and evaluate its intricate aspects in detail. In addition to this, this paper has been reviewed and purchased by most of the students hence; it has been rated 4.8 points on the scale of 5 points. Besides, the price of this paper starts from £ 40. For more details and full access to the paper, please refer to the site.

ACCOUNTING III

Instructions to candidates:

a) Time allowed: Three hours (plus an extra ten minutes’ reading time at the start – do not write anything during this time)

b) Answer ALL questions in Part A and any ONE question in Part B

c) Part A carries 85% of the marks and Part B carries 15% of the marks. Marks for each question are shown in [ ]

d) Non-programmable calculators are permitted in this exam

PART A

1.     The following trial balance has been extracted from the books of Collumbo Ltd for the year ended 29 February 2016:

 

DR

CR

 

£000

£000

Bank

 

100

Administration expenses

760

 

Distribution costs

600

 

5% Debentures

 

1,000

Interest paid

60

 

Non-current assets (net)

1,550

 

Retained earnings (01/03/15)

 

420

Purchases

1,800

 

Sales (all on credit)

 

4,200

Equity share capital (£1 ords.)

 

500

Inventory (stock) (01/03/15)

200

 

Accounts receivable (debtors)

1,400

 

Accounts payable (creditors)

 

150

 

--------

---------

 

6,370

6,370

 

=====

=====

NOTES at 29 February 2016:

Stock (inventory) was valued at £220,000

Corporation tax is estimated to be £210,000

The directors have declared an ordinary dividend of 50p per share

The market price of a single equity (ordinary share) was £19.00

TASKS

 

a)

Prepare the income statement (profit and loss account) for the year ended 29 February 2016.

[3]

b)

Prepare the position statement (balance sheet) as at 29 February 2016.

[5]

c) Calculate the following ratios:

i. The gearing percentage

ii. The operating profit (PBIT) as a percentage of sales

iii. The EPS

 

 

iv

The PE ratio

[4]

 

d)

Comment on the financial performance of Collumbo Ltd. Mention any weaknesses.

[8]

2.

a)

Describe the money measurement concept and state its limitations.

[7]

b) Comment on the view that the prudence concept results in financial statements that understate

 Profits thereby understating the value for capital.

[8]

Continued overleaf

2.     You are presented with the following information from the ABC group of companies for the year to 29 February 2016:

 

ABC plc

Odean plc

Empire plc

 

£000

£000

£000

Tangible fixed assets

850

500

350

Investments:

 

 

 

Shares in Odean plc

500

 

 

Shares in Empire plc

350

 

 

Current assets

850

 

 

 

 

 

Stocks

320

230

90

Debtors

400

200

150

Bank

20

10

20

Current liabilities

740

440

260

 

 

 

Creditors

(340)

(240)

(110)

Net current assets

400

200

150

Total net assets

2,100

700

500

Capital and reserves

=====

=====

=====

 

 

 

Ordinary shares (£1)

1,500

500


0% Plagiarism Guaranteed & Custom Written, Tailored to your instructions


International House, 12 Constance Street, London, United Kingdom,
E16 2DQ

UK Registered Company # 11483120


100% Pass Guarantee

Order Now

STILL NOT CONVINCED?

We've produced some samples of what you can expect from our Academic Writing Service - these are created by our writers to show you the kind of high-quality work you'll receive. Take a look for yourself!

View Our Samples

corona virus stop
FLAT 25% OFF ON EVERY ORDER.Use "FLAT25" as your promo code during checkout