The additional time and choice provided to accounting students this year allowed them to focus on accuracy and correct calculations, a teacher has said.
Patricia Hall, TUI subject representative and a teacher at Firhouse Community College in Dublin, said the usual time pressures have been relieved as a result of added choice, which was brought in due to school closures during the Covid-19 pandemic.
“Students were happy with it, and delighted with a question on incomplete records coming up,” Ms Hall said. “It had not appeared [for some years] so was somewhat expected or hoped for.”
John Taylor, an accounting teacher at the Institute of Education, said the higher level paper was testing, but manageable.
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“Question nine was on production budgeting and was very similar in style to previously asked questions, [but] students may have been surprised that cash budgeting was not asked here,” Mr Taylor said.
Ms Hall, however, said that the production budget question, which appeared instead, was very fair.
The three optional 60-mark questions consisted of cash flow statements, correction of errors and revaluation of fixed assets.
“There were no major surprises here and students attempting this option would have been pleased,” said Mr Taylor. The theory element to these questions was very straightforward. The use of credit notes sent and received in error (iv) of question three required some thinking about but overall, it was a nice errors question.”
On the ordinary level paper, Ms Hall said that it was very straightforward.
“It would have suited students taking it at this level,” she said. “A choice at question one made it more accessible and the cash flow question was very fair. Students would be pleased to see a cash budget in question nine.”
Try this one ay home:
Leaving Cert accounting, higher level
Correction of Errors and Suspense Account
The trial balance of Fletcher Ltd, a sports clothing retailer, failed to agree on 31/12/2021. The difference was entered in a suspense account. On checking the books, the following errors and omissions were discovered:
(i) Credit purchases by Fletcher for €2,400 from E Hegarty had been entered in the day books as €2,040 and was subsequently posted on the incorrect side of Hegarty’s account as €4,020.
(ii) A private debt €750 owed by Fletcher had been offset in full settlement against a business debt €800 owed to Fletcher Ltd. No entry had been made in the books in respect of this transaction.
(iii) A payment of €1,000 was received from F Murtagh a former debtor, whose debt had previously been written off and wishes to trade with Fletcher Ltd again. This represents 80% of the original debt and Murtagh has undertaken to pay the remainder of the debt by February 2023. The only entry made in respect of this transaction was that the full amount written off was credited to the debtors account.
(iv) A credit note sent to K Mullan for €240 had been misread as a credit note received from A Keogh and recorded as such.
(v) Equipment which cost €8,400 and with a book value of €3,360 was sold for cash €3,300. This had been entered as €3,630 on the debit side of the sales account and on the credit side of a debtor’s account.
Required:
(a) Journalise the necessary corrections. (40 marks)
(b) Prepare a statement showing the corrected net profit if the original profit was €27,900. (12 marks)
(c) (i) What is the purpose of preparing a trial balance? (ii) Outline different types of errors that may affect the balancing of the trial balance. (8 marks)
