Accounting 9706/03 Oct Nov 2005 | Cambridge AS Level Past Papers With Mark Scheme

1. Cash flow and financing activities: Identification of non-operational cash flows in financing, calculation of net cash movement from financing, and understanding effects of debenture redemption on equity and working capital.
2. Share capital transactions and business acquisition: Calculation of share premium in company acquisitions, determination of goodwill in purchases, and correct treatment of non-purchased goodwill in financial statements.
3. Financial ratios and dividend analysis: Calculation of market price per share using dividend yield, determination of earnings per share (EPS), and understanding the impact of increased gearing through additional debenture issuance.
4. Cost management and profit optimization: Selection of product lines for maximum profit based on fixed and variable costs, evaluation of production decisions against marginal cost, and calculation of profit from increased production volumes.
5. Budgeting and financial planning: Calculation of production requirements based on stock levels, budgeting of opening bank balance considering sales, purchases, and expenses, and analysis of additional net profit from advertising campaigns.
6. Standard costing and investment appraisal: Analysis of variances in labour, material costs, and efficiency, understanding standard costing applications, and use of accounting rate of return for investment appraisal with net present value (NPV) calculations for project evaluation.