Accounting 9706/01 May June 2005 | Cambridge AS Level Past Papers With Mark Scheme

1. Asset valuation and capital adjustments: Calculation of motor van account debit, determination of provision for business closure costs, and impact of journal entries on subscription income and creditors in club accounting.
2. Provision for doubtful debts and depreciation corrections: Calculation of provision based on debtor balances, correction of depreciation errors in motor vehicles, and proper depreciation rate application for accurate financial reporting.
3. Inventory management and manufacturing costs: Inclusion of finished goods, work-in-progress, and raw materials in manufacturing accounts, identification of factory overhead expenses, and error effects on gross and net profit due to misclassification of wages.
4. Capital structure and shareholder returns: Impact of bonus share issues on share capital and shareholder funds, calculation of return on total capital employed, and effects of fixed asset revaluation on capital employed and profit.
5. Liquidity management and operational efficiency: Reduction of liquidity through asset replacement, calculation of cash operating cycle, and evaluation of semi-variable costs and their effect on unit cost with activity changes.
6. Break-even analysis and contribution margin: Determination of units required to cover fixed costs and desired profit, identification of margin of safety on break-even chart, calculation of contribution to sales ratio, and assessment of under-absorption of fixed overhead.