Accounting 9706/03 May June 2009 | Cambridge AS Level Past Papers With Mark Scheme

1. Goodwill valuation and partnership changes: Importance of accounting for goodwill during partner changes, calculation of capital account balances post-partnership adjustment, and the effects of introducing a new partner.
2. Capital redemption reserve and share transactions: Calculation of capital redemption reserve, use of reserve for bonus issues, and valuation of ordinary shares post-conversion of loan stock.
3. Financial statement adjustments and profit calculation: Recognition of revenue when goods are delivered, calculation of gross profit from sales and closing stock, and determination of interest charges for debentures with varying rates.
4. Risk assessment and financial analysis: Evaluation of financial risk for debenture holders and ordinary shareholders in companies with different capital structures, and analysis of break-even changes due to variances in budgeted and actual sales.
5. Budgeting and cost variance analysis: Purpose of flexible budgets, calculation of total fixed overheads, determination of material price variance, and evaluation of production cost center overheads in standard costing.
6. Investment appraisal and decision-making: Calculation of net present value (NPV) for capital investment projects, comparison of projects based on investment costs and NPV, and understanding the importance of timing and expected net proceeds in NPV analysis.