Accounting 9706/01 May June 2006 | Cambridge AS Level Past Papers With Mark Scheme

1. Capital and revenue expenditures: Classification of expenditures such as printer costs for existing systems, repair costs, and capital versus revenue distinctions in financial reporting.
2. Rental income and financial statement adjustments: Calculation of rental income for partial periods, inclusion of accrued amounts as current assets or liabilities, and impact on profit and loss accounts.
3. Depreciation methods and asset valuation: Consistency in depreciation methods like straight-line, implications of damaged stock valuation based on cost, sale, and replacement value, and matching principle application in depreciation.
4. Inventory and goodwill treatment: Calculation of closing stock using lower of cost or net realizable value, appropriate accounting treatment of goodwill in limited company accounts, and adjustments for sales ledger control accounts.
5. Financial ratios and net profit adjustments: Correction of errors in financial statements affecting net profit, calculation of purchases using markup percentages, and interpretation of changes in gross and net profit ratios.
6. Break-even analysis and costing: Interpretation of break-even charts, calculation of contribution per unit and break-even points, absorption costing for gross profit determination, and allocation of overheads between departments based on usage metrics.