Pearson LCCI

Monday 11 April 2022

Time: 3 hours Paper Reference ASE20104

Certificate in Accounting (VRQ)

Level 3

Resource Booklet
Do not return this Booklet with the question paper.

Instructions
• AllPlease
workings and answers must be given in the question paper.
• not benote that any workings and answers written in the Resource Booklet will
marked.

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©2022 Pearson Education Ltd.

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Resource for Question 1 – Part (c).
Blastt plc provided the following information.

At 1 January 2021 $

Land and buildings 960 000

Retained earnings 368 460

Share capital – ordinary shares of $0.50 each 375 000

During the year land and buildings were revalued to $1 070 000 and a rights issue of two
ordinary shares for every five shares held was made at a premium of $0.15 per share. The
issue was fully subscribed.

At 31 December 2021

7% bank loan (2028) 90 000

Equipment – carrying value 183 250

Bank 9 720 Cr

Cash 1 800

Inventory 54 650

Tax payable 26 940

Trade payables 72 330

Trade receivables 103 680

Additional information
• Closing inventory included damaged goods, cost $790, which could be sold for $910
after repairs costing $360
• Rent, $2 100, had been paid in advance for the three months to 31 January 2022.
• One month’s interest on the 7% bank loan was owing.
The draft profit for the year ended 31 December 2021, before adjusting for any of the
above, was $165 930

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Resource for Question 2 – Part (a).
Manpreet provided the following information in addition to the extended trial balance at
31 March 2022 on page 4 of the question paper.
• The purchase of equipment, $600, had not been recorded. Manpreet paid for this
with her personal cash.
• The proceeds of the disposal of equipment, $3 500, had been debited to both the
bank account and the disposal account. All other entries had been recorded correctly.
• Credit purchases, $1 390, had been recorded twice in the purchases day book.
• A dishonoured cheque from a credit customer, $120, had been debited to the bank
account and credited to the sales account.
• The allowance for doubtful debts is to be maintained at 5% of trade receivables.
• Rental income included $150 for April 2022.
• Depreciation on equipment is charged at 10% per annum using the straight line
method.

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There is no resource for Question 3.

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Resource for Question 4 – Parts (a), (b) and (c).
Aspen manufactures two products, Aye and Bee, at his factory in the United Kingdom.
Aspen operates a system of marginal costing.
Aspen provides the following budgeted information for May 2022.

Product
Per unit
Aye Bee
$ $

Selling price 28.00 43.00

Direct material 16.00 24.00

Direct labour 5.00 9.00

Sales commission 1.00 2.00

Fixed factory overheads 2.00 3.00

Profit 4.00 5.00

Aye Bee

Forecast monthly sales 2 000 units 3 000 units

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Resource for Question 5 – Parts (a) and (b).
Matt provided the following budgeted information for the three-month period ending
31 July 2022.

May 2022 June 2022 July 2022

Purchases and sales (units) 890 930 750

• All transactions are on a cash basis.

• The purchase price is $16 per unit.
• All goods are sold at a mark up of 25%.
• Salaries are $2 700 per month.
• Staff are paid a commission of 2% of sales, payable in the month of sale.
• General expenses of $3 210 per month include depreciation of $620
• Rent is $350 per month, payable half yearly in January and June.
• Additional capital of $10 000 will be introduced in May 2022.
• The bank balance is expected to be $3 150 overdrawn on 1 May 2022.
• Bank interest is charged at 2% per month if the bank balance is overdrawn at the end
of the month. Interest will be paid in the following month.

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