Cambridge International AS & A Level ACCOUNTING 9706/41 Paper 4 Cost and Management Accounting October/November 2023 INSERT 1 hour * 5 9 5 8 2 4 0 3 9 1 - I * INFORMATION ● This insert contains all of the sources referred to in the questions. ● You may annotate this insert and use the blank spaces for planning. Do not write your answers on the insert. This document has 4 pages. Any blank pages are indicated. DC (PQ) 312032/2 © UCLES 2023 [Turn over

Cambridge International AS & A Level
ACCOUNTING 9706/41
Paper 4 Cost and Management Accounting October/November 2023
INSERT 1 hour
* 5 9 5 8 2 4 0 3 9 1 - I *
INFORMATION
● This insert contains all of the sources referred to in the questions.
● You may annotate this insert and use the blank spaces for planning. Do not write your answers on the
insert.
This document has 4 pages. Any blank pages are indicated.
DC (PQ) 312032/2
© UCLES 2023 [Turn over

2 Source A for Question 1 P Limited sells one product. To prepare the cash budget for the three-month period ending on 31 January, the management accountant provided the following information. 1 P Limited has a mark-up of 50% on all sales. 2 Sales: Actual sales Budgeted sales September October November December January $360 000 $420 000 $390 000 $450 000 $375 000 10% of sales are on a cash basis. The remaining customers pay two months after sales. It is estimated that 2% of the trade receivables will be irrecoverable. 3 All purchases are on credit. P Limited is allowed to pay two months after purchase. However, P Limited always pays one month after purchase to get a cash discount of 1.5%. 4 It is the policy of P Limited to maintain an inventory level at the end of each month sufficient to meet 40% of the sales of the coming month. 5 Depreciation and other operating expenses total $131 000 each month. The other operating expenses are paid in the month in which they are incurred. 6 Plant and equipment are depreciated at the rate of 15% per annum using the straight-line method. All the plant and equipment were bought three years ago for $124 000. 7 The cash at bank on 1 November would be $95 000. © UCLES 2023 9706/41/INSERT/O/N/23

2
Source A for Question 1
P Limited sells one product. To prepare the cash budget for the three-month period ending on
31 January, the management accountant provided the following information.
1 P Limited has a mark-up of 50% on all sales.
2 Sales:
Actual sales Budgeted sales
September October November December January
$360 000 $420 000 $390 000 $450 000 $375 000
10% of sales are on a cash basis. The remaining customers pay two months after sales. It is
estimated that 2% of the trade receivables will be irrecoverable.
3 All purchases are on credit. P Limited is allowed to pay two months after purchase. However,
P Limited always pays one month after purchase to get a cash discount of 1.5%.
4 It is the policy of P Limited to maintain an inventory level at the end of each month sufficient to
meet 40% of the sales of the coming month.
5 Depreciation and other operating expenses total $131 000 each month. The other operating
expenses are paid in the month in which they are incurred.
6 Plant and equipment are depreciated at the rate of 15% per annum using the straight-line method.
All the plant and equipment were bought three years ago for $124 000.
7 The cash at bank on 1 November would be $95 000.
© UCLES 2023 9706/41/INSERT/O/N/23

3 Source B for Question 2 G Limited produces a single product and adopts absorption costing. The budgeted and actual results for the month of July are as follows: Budgeted Actual Products manufactured and sold (units) 2 000 1 800 $ $ Sales 146 000 136 800 Direct material 36 000 33 408 Direct labour 64 000 58 752 Fixed overhead 32 000 33 920 Total costs 132 000 126 080 Profit 14 000 10 720 G Limited carried out variance analysis. © UCLES 2023 9706/41/INSERT/O/N/23

3
Source B for Question 2
G Limited produces a single product and adopts absorption costing. The budgeted and actual results
for the month of July are as follows:
Budgeted Actual
Products manufactured and sold (units) 2 000 1 800
$ $
Sales 146 000 136 800
Direct material 36 000 33 408
Direct labour 64 000 58 752
Fixed overhead 32 000 33 920
Total costs 132 000 126 080
Profit 14 000 10 720
G Limited carried out variance analysis.
© UCLES 2023 9706/41/INSERT/O/N/23

4 BLANK PAGE Permission to reproduce items where third-party owned material protected by copyright is included has been sought and cleared where possible. Every reasonable effort has been made by the publisher (UCLES) to trace copyright holders, but if any items requiring clearance have unwittingly been included, the publisher will be pleased to make amends at the earliest possible opportunity. To avoid the issue of disclosure of answer-related information to candidates, all copyright acknowledgements are reproduced online in the Cambridge Assessment International Education Copyright Acknowledgements Booklet. This is produced for each series of examinations and is freely available to download at www.cambridgeinternational.org after the live examination series. Cambridge Assessment International Education is part of Cambridge Assessment. Cambridge Assessment is the brand name of the University of Cambridge Local Examinations Syndicate (UCLES), which is a department of the University of Cambridge. © UCLES 2023 9706/41/INSERT/O/N/23

4
BLANK PAGE
Permission to reproduce items where third-party owned material protected by copyright is included has been sought and cleared where possible. Every
reasonable effort has been made by the publisher (UCLES) to trace copyright holders, but if any items requiring clearance have unwittingly been included, the
publisher will be pleased to make amends at the earliest possible opportunity.
To avoid the issue of disclosure of answer-related information to candidates, all copyright acknowledgements are reproduced online in the Cambridge
Assessment International Education Copyright Acknowledgements Booklet. This is produced for each series of examinations and is freely available to download
at www.cambridgeinternational.org after the live examination series.
Cambridge Assessment International Education is part of Cambridge Assessment. Cambridge Assessment is the brand name of the University of Cambridge
Local Examinations Syndicate (UCLES), which is a department of the University of Cambridge.
© UCLES 2023 9706/41/INSERT/O/N/23

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