Accounting 9706 · AS & A Level · Preparation of financial statements

Preparation of financial statements — practice question

Use Source A1 in the insert.
(a)[8]

Prepare a manufacturing account covering the year ended 31 December 2020.

(b)[3]

Prepare the provision for unrealised profit account for the year ended 31 December 2020.

(c)[5]

Explain the treatment of unrealised profit in G Limited's statement of financial position at 31 December 2020. In your answer, refer to relevant accounting concepts.

(d)[4]

Prepare the trading section of the income statement for the year ended 31 December 2020, showing the gross profit from luxury sofas and standard sofas separately.

(e)[5]

Advise the directors on which option to choose. Justify your response and back it up with calculations.

Worked solution & mark scheme

This 25-mark question has a full step-by-step worked solution and mark scheme.

  • Full mark scheme, point by point
  • Step-by-step worked solution
  • Write your answer & get it marked instantly by AI