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

Preparation of financial statements — practice question

Use Source A4 in the insert.
(a)[4]

Explain how the trading account of a charity shop is unlike that of a business.

(b)[7]

Prepare the income and expenditure account for the year ending 31 December 2020.

(c)[8]

Prepare the statement of financial position as at 31 December 2020.

(d)[2]

Suggest two methods by which X Soc could raise its income.

(e)[2]

Explain why the accumulated fund of a not for profit organisation might differ from the balance in its bank account.

(f)[2]

Explain why the financial statements of some not for profit organisations may include entries for subscriptions.

Worked solution & mark scheme

This 25-mark question has a full step-by-step worked solution and mark scheme. One marking point: There is no cost of sales because nothing is purchased

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