4.1 Choose a term in COLUMN B that matches an explanation in COLUMN A - NSC Accounting - Question 4 - 2019 - Paper 1
Question 4
4.1 Choose a term in COLUMN B that matches an explanation in COLUMN A. Write only the letters (A–E) next to the question numbers (4.1.1 to 4.1.4) in the ANSWER BOOK.... show full transcript
Worked Solution & Example Answer:4.1 Choose a term in COLUMN B that matches an explanation in COLUMN A - NSC Accounting - Question 4 - 2019 - Paper 1
Step 1
4.1.1 Reflects the financial position of a business on a specific date
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Answer
The term that matches this explanation is C. Balance Sheet. The Balance Sheet provides a snapshot of the company's financial position, detailing assets, liabilities, and equity as of a specific date.
Step 2
4.1.2 Shows whether the business made a profit or loss
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The term that matches this explanation is D. Income Statement. The Income Statement summarizes revenues, costs, and expenses during a specific period to show whether the business was profitable.
Step 3
4.1.3 Provides details about the movement of money with regard to operating, investing and financing activities
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The term that matches this explanation is B. Cash Flow Statement. This statement tracks the flow of cash in and out of the business, categorizing it into operating, investing, and financing activities.
Step 4
4.1.4 Provides an unbiased opinion on the reliability of the financial statements of a business
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The term that matches this explanation is A. Audit Report. The Audit Report offers an independent review of the financial statements, confirming their accuracy and compliance with accounting standards.
Step 5
4.2.1 Choose the correct word from those given in brackets. Give ONE reason.
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The correct word is Unqualified. This indicates that the audit was conducted without any issues. The auditors believe the financial statements are fair and free from material misstatements.
Step 6
4.2.2 Give ONE reason why the Companies Act requires public companies to be audited by an independent auditor.
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To ensure that an unbiased view is presented in the financial statements, which helps to protect the interests of shareholders and maintain transparency.
Step 7
4.2.3 Explain how this may influence shareholders of Everest Ltd. State TWO points.
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Shareholders may lose trust in the audit process and the integrity of the financial reports, leading to potential sell-offs of shares.
Concerns about the reliability of the financial information may prompt shareholders to demand a re-audit or refuse to re-elect the current auditors.
Step 8
4.3.1 Complete the Statement of Comprehensive Income (Income Statement) for the year ended 31 March 2019.
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The Statement of Comprehensive Income would include revenues, expenses broken down into categories, and finally profit or loss for the year. Calculations need to be performed based on the provided figures.
Step 9
4.3.2 Complete the following notes to the Balance Sheet: Fixed/Tangible Asset Note
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For Fixed/Tangible Assets, carry out an analysis of the assets by listing the cost, accumulated depreciation, and the net book value for land and buildings, vehicles, and equipment as per given data.
Step 10
4.3.2 Complete the following notes to the Balance Sheet: Ordinary share capital
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For Ordinary Share Capital, summarize the authorized capital, shares issued at the beginning, shares repurchased, additional shares issued, and total shares in issue as presented in the trial balance information.
