Practice Summer 2022 Exam
AC331
Contemporary issues in financial accounting
Suitable for 2021/2022 syllabus only
Instructions to candidates
Answer all questions
Show all workings clearly, and state clearly any assumptions you need to make.
Question 1: 40 marks
Question 2: 30 marks
Question 3: 30 marks
Total: 100 marks
Time Allowed:
Reading Time: 15 minutes
Writing Time: 2 hours
You are allowed 15 minutes for reading the question paper. During this time you may NOT write anything in
your answer book but you may annotate the question paper if you wish. You are then allowed 2 hours in
which to answer the paper.
You are supplied with: Present value tables
You may also use: No additional materials
Calculators: Calculators are allowed in this exam
LSE ST 2022/AC331 Page 1 of 9
, Answer ALL questions.
QUESTION 1
The table below presents the annual balance sheet and income statement for the pharmaceutical company
Greenway plc. The balance sheet is for the financial years ending on 31 December 2020 and 31 December
2019 and the income statement is for the financial year ending on 31 December 2020 only.
Annual Balance Sheet (As Reported)
31/12/2020 31/12/2019
£ million £ million
Cash & cash equivalents 56 89
Accounts receivable 266 15
Income taxes receivable 9 0
Short term investments 18 1
Marketable securities 143 59
Biological assets 34 14
Inventory 114 30
Property, plant & equipment, gross 818 253
Less: accumulated depreciation -52 -7
Derivatives 86 125
Deposits 7 0
Intangible assets 688 256
Goodwill 3,173 729
Other non-operating assets 143 347
Total assets 5,503 1,911
Accounts payable 153 48
Convertible debentures 504 0
Short-term Loans & borrowings 14 2
Provisions 4 0
Convertible notes 0 192
Loans & borrowings 127 9
Derivative liabilities 177 0
Deferred tax liability 92 69
Other operating liabilities 42 28
Total liabilities 1,113 348
Share capital 4,673 1,466
Reserves 140 5
Accumulated other comprehensive income -143 -1
Retained earnings (deficit) -284 88
Non-controlling interest 4 5
Total shareholders’ equity 4,390 1,563
Total liabilities & shareholders’ equity 5,503 1,911
LSE ST 2022/AC331 Page 2 of 9
AC331
Contemporary issues in financial accounting
Suitable for 2021/2022 syllabus only
Instructions to candidates
Answer all questions
Show all workings clearly, and state clearly any assumptions you need to make.
Question 1: 40 marks
Question 2: 30 marks
Question 3: 30 marks
Total: 100 marks
Time Allowed:
Reading Time: 15 minutes
Writing Time: 2 hours
You are allowed 15 minutes for reading the question paper. During this time you may NOT write anything in
your answer book but you may annotate the question paper if you wish. You are then allowed 2 hours in
which to answer the paper.
You are supplied with: Present value tables
You may also use: No additional materials
Calculators: Calculators are allowed in this exam
LSE ST 2022/AC331 Page 1 of 9
, Answer ALL questions.
QUESTION 1
The table below presents the annual balance sheet and income statement for the pharmaceutical company
Greenway plc. The balance sheet is for the financial years ending on 31 December 2020 and 31 December
2019 and the income statement is for the financial year ending on 31 December 2020 only.
Annual Balance Sheet (As Reported)
31/12/2020 31/12/2019
£ million £ million
Cash & cash equivalents 56 89
Accounts receivable 266 15
Income taxes receivable 9 0
Short term investments 18 1
Marketable securities 143 59
Biological assets 34 14
Inventory 114 30
Property, plant & equipment, gross 818 253
Less: accumulated depreciation -52 -7
Derivatives 86 125
Deposits 7 0
Intangible assets 688 256
Goodwill 3,173 729
Other non-operating assets 143 347
Total assets 5,503 1,911
Accounts payable 153 48
Convertible debentures 504 0
Short-term Loans & borrowings 14 2
Provisions 4 0
Convertible notes 0 192
Loans & borrowings 127 9
Derivative liabilities 177 0
Deferred tax liability 92 69
Other operating liabilities 42 28
Total liabilities 1,113 348
Share capital 4,673 1,466
Reserves 140 5
Accumulated other comprehensive income -143 -1
Retained earnings (deficit) -284 88
Non-controlling interest 4 5
Total shareholders’ equity 4,390 1,563
Total liabilities & shareholders’ equity 5,503 1,911
LSE ST 2022/AC331 Page 2 of 9
