9706_w25_in_32.pdf 9706_w25_in_32.pdf 9706_w25_in_32.pdf
Cambridge International AS & A Level
ACCOUNTING 9706/32
Paper 3 Financial Accounting October/November 2025
INSERT 1 hour 30 minutes
*1640324897-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 8 pages. Any blank pages are indicated.
DC (SL) 341194/4
© UCLES 2025 [Turn over
9706_w25_in_32.pdf 9706_w25_in_32.pdf 9706_w25_in_32.pdf
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2
Source A for Question 1
Omira and Peter were in partnership for some years, sharing profits and losses in the ratio 3 : 2
respectively. They decided to sell the partnership business to QW plc on 31 May 2025. The partnership
statement of financial position on that date was as follows:
$ $
Non-current assets 51 500
Current assets 20 900
Total assets 72 400
Capital accounts
Omira 35 000
Peter 25 000 60 000
Current accounts
Omira (2 900)
Peter 6 000 3 100
Current liabilities
Trade payables 7 900
Bank overdraft 1 400 9 300
Total capital and liabilities 72 400
During the negotiations for the acquisition, QW plc offered the partners two options.
Option 1
All employees of the partnership would have their employment terminated at acquisition. This would
involve the partnership paying total redundancy pay of $20 000.
Omira and Peter would both become employees of QW plc for a period of one year while they trained
the staff from the company who would take over from the partnership employees. Omira and Peter
would be paid very generous salaries during their year of employment.
Omira and Peter would each take over one of the vehicles of the partnership at their book values of
$12 200 and $5 200 respectively. QW plc would take over all other assets and liabilities except for the
partnership bank account.
Legal fees of $3100 would be paid by the partnership.
The purchase consideration would be $200 000, consisting of $100 000 cash and 80 000 ordinary
shares in QW plc. These shares would have a nominal value of $1 each and would be divided equally
between the partners.
© UCLES 2025 9706/32/INSERT/O/N/25
9706_w25_in_32.pdf 9706_w25_in_32.pdf 9706_w25_in_32.pdf
Cambridge International AS & A Level
ACCOUNTING 9706/32
Paper 3 Financial Accounting October/November 2025
INSERT 1 hour 30 minutes
*1640324897-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 8 pages. Any blank pages are indicated.
DC (SL) 341194/4
© UCLES 2025 [Turn over
9706_w25_in_32.pdf 9706_w25_in_32.pdf 9706_w25_in_32.pdf
, 9706_w25_in_32.pdf 9706_w25_in_32.pdf 9706_w25_in_32.pdf
2
Source A for Question 1
Omira and Peter were in partnership for some years, sharing profits and losses in the ratio 3 : 2
respectively. They decided to sell the partnership business to QW plc on 31 May 2025. The partnership
statement of financial position on that date was as follows:
$ $
Non-current assets 51 500
Current assets 20 900
Total assets 72 400
Capital accounts
Omira 35 000
Peter 25 000 60 000
Current accounts
Omira (2 900)
Peter 6 000 3 100
Current liabilities
Trade payables 7 900
Bank overdraft 1 400 9 300
Total capital and liabilities 72 400
During the negotiations for the acquisition, QW plc offered the partners two options.
Option 1
All employees of the partnership would have their employment terminated at acquisition. This would
involve the partnership paying total redundancy pay of $20 000.
Omira and Peter would both become employees of QW plc for a period of one year while they trained
the staff from the company who would take over from the partnership employees. Omira and Peter
would be paid very generous salaries during their year of employment.
Omira and Peter would each take over one of the vehicles of the partnership at their book values of
$12 200 and $5 200 respectively. QW plc would take over all other assets and liabilities except for the
partnership bank account.
Legal fees of $3100 would be paid by the partnership.
The purchase consideration would be $200 000, consisting of $100 000 cash and 80 000 ordinary
shares in QW plc. These shares would have a nominal value of $1 each and would be divided equally
between the partners.
© UCLES 2025 9706/32/INSERT/O/N/25
9706_w25_in_32.pdf 9706_w25_in_32.pdf 9706_w25_in_32.pdf
