A-LevelAccountingInterpretation of Financial StatementsFeb/Mar 2025Paper 1 Q221 Mark

The accounting year of a company ends on 31 December. At the end of Year 1, the company was financed by equity of $850000 and there were no long-term borrowings. At the beginning of Year 2, a 6% debenture of $150000 was issued. Profit for the year for Year 2 was $58000 and dividends of $20000 were paid. What was the return on capital employed for Year 2?

Q: What is the correct answer to this A-Level Accounting question?

The correct answer is C: 6.45%.

Q: What topic does this question test?

This question tests Interpretation of Financial Statements in A-Level Accounting (syllabus code 9706). It is worth 1 mark.

A5.59%

B6.33%

C6.45%

D7.55%

✓ Correct Answer

The correct answer is C: 6.45%

📋 Examiner Report & Trap Analysis

Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...

🎯 Mark Scheme Breakdown

Award 1 mark for identifying the correct principle. Award 1 mark for showing clear working. Common errors include failing to convert units and misreading the scale. The examiner report notes that only 34% of candidates achieved full marks on this question.

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About This A-Level Accounting Question

Topic

This multiple-choice question tests Interpretation of Financial Statements in A-Level Accounting (syllabus code 9706). It is worth 1 mark.

Source

This question appeared in the Cambridge A-Level Accounting Feb/Mar 2025 examination, Paper 1 Variant 2.

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