The following is a list of balances from the books of J. Davies, a sole trader, as at 31 December 2023:

Mark scheme

Marking points from the official mark scheme. The mark or mark type is shown in brackets.

1. (a) Statement of Financial Position (12 marks)
2. B1 for correct heading (Name, Statement of Financial Position, As at 31 December 2023).
3. B1 for Non-current Assets section (including correct categories like Land & Buildings, Fixtures & Fittings, Motor Vehicles).
4. B1 for Accumulated Depreciation / Net Book Value calculation for each non-current asset (if applicable, based on provided figures).
5. B1 for Total Non-current Assets.
6. B1 for Current Assets section (including Inventory, Trade Receivables, Bank/Cash).
7. B1 for Total Current Assets.
8. B1 for Current Liabilities section (including Trade Payables, Accrued Expenses).
9. B1 for Total Current Liabilities.
10. B1 for Working Capital (Current Assets - Current Liabilities).
11. B1 for Net Assets (Total Non-current Assets + Working Capital).
12. B1 for Capital (Opening Capital + Profit for the year - Drawings).
13. B1 for Total Equity and Liabilities (Capital + Non-current Liabilities + Current Liabilities).
14. Final check: Net Assets MUST equal Capital / Total Equity.
15. All figures must be correct and balanced for full marks per line item and section totals.
16. Note: specific figures for assets, liabilities, capital, drawings, profit would be provided in the actual question paper, leading to specific numerical values for marks.
17. (b) Users of financial statements and interest in SFP (3 marks)
18. B1 for stating a correct user (e.g. Owner/Shareholders, Managers, Creditors/Lenders, Potential Investors, Government/Tax authorities).
19. B1 for explaining why that user is interested in the SFP (e.g. Owner: assess financial health, solvency, value of investment; Creditors: assess ability to repay debts, liquidity).
20. B1 for second user and explanation.