Assessment Schedule 2012 Accounting: Demonstrate understanding of accounting concepts for small entities (90976)

Transcription

1 NCEA Level 1 Accounting (90976) 2012 page 1 8 Assessment Schedule 2012 Accounting: Demonstrate understanding s for small entities (90976) Evidence Statement Question Evidence ONE To provide Alex with / communicate financial information to enable / help him to make financial decisions regarding. (b) (i) Describe: A cash shows Alex estimated cash payments and estimated cash receipts for next six months / what expected bank balance might be for in 6 months time / for a period time. (Not prit, etc) Explain (in addition to describe): This enables Alex to make decisions about cash in and cash out / provide guidelines for future spending / arrange finance / purchasing an asset or not for next 6 months. (ii) An is applied to and 6 monthly cash (Note, not all s can provide evidence to excellence level). Examples include: Mallika is following reporting period breaking life up into time periods equal length, in this case preparing cash every six months. This ensures that information is timely so that comparisons in cash-flow can be made / can be used to indicate need for a loan/wher can afford to buy new equipment / can compare to cash flow statement. Mallika is following going concern preparing cash detailing estimated future receipts and payments for next 6 months, which assumes that will continue into foreseeable future. Mallika is following entity preparing cash for predicted cash transactions for next 6 months for only, and not having Alex s payments / receipts in. (c) Assets: The asset Bank decreases $800 Expenses: The expense (Apprentice) wages s $800 (d) Example: The entity is applied AJ Builder. They will report as drawings in Statement Financial Position to keep business / transactions separate from Alex s / transactions, because for deck is a expense, not a business expense, refore it is not reported in Income Statement.

2 NCEA Level 1 Accounting (90976) 2012 page 2 8 Judgement Statement Question One N1 N2 A3 A4 M5 M6 E7 E8 identifies one partial description cash. purpose components cash a in (b) (ii) that assets decrease or entity or that transaction will be drawings. purpose components a cash a in (b) (ii) that assets decrease or entity or that purchase will be reported as drawings. THREE : purpose components a cash a in (b) (ii) that assets decrease and entity or that purchase will be reported as drawings. explains purpose cash in context explains in context a applied to preparation 6 monthly asset bank decreases $800 wages expense s $800 explains why purchase is drawings to ensure separation & Alex s finances in context. THREE : explains purpose cash explains in context a applied to preparation 6 monthly asset bank decreases $800 AND wages expense s $800 explains why purchase is drawings to ensure separation & Alex s finances in context. applies an to use cash for AJ for 6 months / detailing how it would be used for decisions applies purchase to entity financial separation & Alex s finances in context AND how purchase is drawings in statement financial position / not an in Income statement no detracting ALL : applies an to use cash for AJ for 6 months / detailing how it would be used for decisions applies purchase to entity financial separation & Alex s finances in context AND how purchase is drawings in statement financial position AND not an in Income statement no detracting N0/ = No response; no evidence.

3 NCEA Level 1 Accounting (90976) 2012 page 3 8 Question Evidence TWO advertising building supplies used interest on loan repairs to tools and equipment. (b) Describes / explains / fully explains THREE : building fees is for because building fees will economic benefits in form inflows cash from customers paying building fees to have ir houses built. This s assets increasing bank account building fees prit which leads to an in Alex s equity in it is not owner Alex making a contribution to. (c) Describes / explains / fully explains features Capital and : The purchase vehicle is capital, because vehicle is a one-f purchase that will provide economic benefit AJ builders beyond current year because apprentice will be able to use vehicle to get to building jobs to earn for. The vehicle will be an asset in Statement Financial Position. The purchase / payment insurance vehicle is / as it is day to day / recurring / on-going that will only benefit for current year / year use. The insurance will be an expense / decrease prit in Income Statement. Note: features written as opposites will only receive credit for one, eg a vehicle is a one-f purchase / insurance is not a one-f purchase

4 NCEA Level 1 Accounting (90976) 2012 page 4 8 Judgement Statement Question Two N1 N2 A3 A4 M5 M6 E7 E8 recognise ONE expense partial definition. two two vehicle is capital insurance is. three (maximum one in account) all three one feature capital with example one feature with example ly identifies that Vehicle is capital and insurance is (if no feature described) ALL : three (maximum one in account) all three one feature capital with example one feature with example. building fees / fees received is in context elaborating on how assets and / or equity vehicle meets two features capital insurance meets two features. ALL : building fees / fees received is in context elaborating on how assets and equity vehicle meets two features capital insurance meets two features. in addition to Merit: applies how building fees is for explaining receipts cash from building houses, and not Alex contribution fully explains difference between capital and detailing at least two features for using vehicle and insurance as examples no detracting ALL : in addition to Merit: applies how building fees is for explaining receipts cash from building houses for paying customers / clients, and not Alex contribution fully explains difference between capital and detailing at least two features for using vehicle and insurance as examples no detracting N0/ = No response; no evidence.

5 NCEA Level 1 Accounting (90976) 2012 page 5 8 Question Evidence THREE Equity = Assets Liabilities Equity = Assets (Tools and Equipment $ Vehicle $10 000) Liabilities (Accounts Payable $800 + Bank overdraft $ Loan from family $2 000) Equity = $ (b) Examples include: Alex s assets may be forced to be used / sold to pay f debts if it gets into financial difficulty and is not able to pay its debts. Alex is ly liable to pay f debts if get into financial difficulty because Alex and his business have no legal separation. Not: Bankrupt / if Alex can t pay his debts. (c) Characteristics Loan as a described / explained / fully explained. The bank loan is a non-current in Statement Financial Position as it meets a. The $6000 bank loan was received in past from bank to purchase tools. have a present obligation to pay loan back to bank / as stated on loan contract / before 5 years is up has a future sacrifice assets because when y pay back loan it will decrease ir bank account each payment that is made in future Identify and describe / explain / apply an : (Note: not all can provide evidence for Excellence). Examples include: Going Concern: As loan has been taken out for a period 5 years, it indicates that business will continue to operate at least that long which means y will continue to operate for foreseeable future, and this is why it is classified as a non-current Historical Cost: The bank loan is $6 000 in Statement Financial Position as this is original acquisition cost loan to / amount borrowed. It is loan principal and does not include any interest owing Monetary Measurement: The monetary measurement means that bank loan is reported in Statement Financial Position in common currency New Zealand dollars. The 5 year bank loan will be NZ$6 000 as is based in Taupo and New Zealand dollars is currency New Zealand.

6 NCEA Level 1 Accounting (90976) 2012 page 6 8 (d) Clearly describes which is in essence is reporting financial events / transaction / claims to event in financial statements period y relate to, regardless when cash changes hands. Examples description: Accrual requires that transactions are reported in financial statements in period to which y relate, regardless when cash changes hands Accrual requires an entities economic resource to be reported in period effects and claims transactions occur, regardless when cash is paid or received Explanation (how) and application (how and why) applies to reporting for both Income statement and statement financial position. Examples include: The $600 is deducted from rent paid and $7 200 is rent in this year s Income Statement for (or $600 is reported in next year statement), as that is rent that has been used this year and effect this years prit, and $600 rent for fice that has been paid in advance has not been used this year so it doesn t belong / fice will be used next year. Prepayments $600 will be a current asset in Statement Financial Position AJ. This represents future benefit will receive in next financial year in form fice space / use building in next period/rent owed to, which has already been paid for this year.

7 NCEA Level 1 Accounting (90976) 2012 page 7 8 Judgement Statement Question Three N1 N2 A3 A4 M5 M6 E7 E8 Some partially equation or definition. equation and some working in equity $ is shown (no working) that is about definition a that bank loan is a noncurrent identifies an definition or that rent expense has to decrease $600 or is an asset. THREE : equation and some working (one classification error / omission) in equity $ is shown (no working) that is about / owners for business debts description characteristi cs a or loan is a non-current defines an linked to loan defines / describes that rent expense has to decrease $600 or is an asset $600. FOUR : equation and some working (one classification error / omission) in equity $ is shown (no working) that is about / owners for business debts description characteristi cs a or loan is a non-current defines an linked to loan defines / describes that rent expense has to decrease $600 or is an asset $600. THREE : equation & equity $11000 (or working with minor arithmetic error) explains including when it would take effect for Alex 3 characteristi cs a and explains some for loan for AJ explains an in terms loan for AJ explains for adjustment as reporting in period rent decreasing $600 due to expense / on this years statement/ on next years statement explains for adjustment in relation to reporting in period prepayment $600 is current asset being created / asset on Statement Financial Position. FIVE : equation & equity $11000 (or working with minor arithmetic error) explains including when it would take effect for Alex 3 characteristi cs a and explains some for loan for AJ explains an in terms loan for AJ explains for adjustment as reporting in period rent decreasing $600 due to expense / on this years statement/ on next years statement explains for adjustment in relation to reporting in period prepayment $600 is current asset being created / asset on Statement Financial Position. applies loan in terms for fully explains / applies an in terms 5 year loan for AJ applies explaining in detail how and why $600 is reported in Income Statement for period applies explaining in detail how and why is reported in Statement Financial Position as a current asset, prepayment $600 for period for AJ fice rental no detracting THREE : applies loan in terms for, being NCL fully explains / applies an in terms 5 year loan for AJ applies explaining in detail how and why $600 (deducted / $7200) is reported in Income Statement for period applies explaining in detail how and why $600 is a current asset in Statement Financial Position as a current asset, prepayment $600 for period for AJ fice rental no detracting N0/ = No response; no evidence.

8 NCEA Level 1 Accounting (90976) 2012 page 8 8 Judgement Statement Not Achieved Achievement Achievement with Merit Achievement with Excellence Score range