Accounting 9706/04 May June 2006 | Cambridge AS Level Past Papers With Mark Scheme

1. Financial statement preparation and adjustments: Preparation of Trading and Profit and Loss and Appropriation Account for Franken Ltd, including depreciation and provision for taxation and final dividend adjustments.
2. Cash flow statement and financial analysis: Preparation of cash flow statement for Franken Ltd, reasons for cash flow statement preparation, and analysis of changes in working capital and operating cash flows.
3. Business acquisition and capital revaluation: Valuation of Anjni Patel’s business assets and liabilities, calculation of purchase consideration, revaluation of Chin Ltd’s premises, and balance sheet preparation post-acquisition.
4. Profit maximization and resource allocation: Calculation of optimal production mix for Lagrad Ltd's cameras using constrained resources, marginal cost statement preparation, and break-even sales revenue determination.
5. Investment decision and financial planning: Analysis of Anjni’s expected income post-acquisition, financial advice for accepting the offer from Chin Ltd, and non-financial considerations in business acquisition decisions.
6. Costing methods and production strategy: Identification of fixed and variable costs, marginal costing for profit calculation, and potential disadvantages of the planned production pattern, including operational and strategic risks.