Hbc2103:Introduction To Accounting Ii Question Paper
Hbc2103:Introduction To Accounting Ii
Course:Bachelor Of Commerce
Institution: Meru University Of Science And Technology question papers
Exam Year:2010
QUESTION ONE (Total Marks – 30)
The following are the accounts for a small printing firm extracted for the month of May 2006
May 1 Started in Business with capital in cash Sh.800.00 and Sh.2,200,000 in bank.
May 2 Bought goods on credit from the following persons
J. Wanderi Sh.610,000
P. Mageto Sh.214,000
M. Ondinga Sh174,000
S. Gesami Sh.345,000
P. Wambui Sh.542,000
May 4 Sold goods on credit to:
J. Kinoti Sh.340,000
G. Musau Sh.720,000
F. Guyo Sh.1,152,000
May 6 Paid rent by cash Sh.180,000
May 9 J. Kinoti paid his account by cheque Sh.340,000
May 10 F. Guyo paid his account Sh.1,000,000 by cheque
May 12 We paid the following by cheque; M. Ondinga Sh.174,000, J.Wanderi Sh.610,000.
May 15 Paid carriage by cash Sh.38,000
May 18 Bought goods on credit from P. Mageto Sh.291,000, S. Gesami Sh.940,000
May 21 Sold goods on credit to G. Musau Sh.810,000
May 31 Paid rent by Cheque Sh.230,000
REQUIRED
a) Make Journal entries for the above transactions. (10marks) b) Post the above information into their respective ledger accounts (14marks) c) Extract a trial balance (6marks)
QUESTION TWO (Total Marks – 20)
Mr Kamara has been trading for some years as ware merchant. The following list of balances
have been extracted from his ledger as at 30 April 2005, the end of his most recent financial
year.
Sh .(000)
Capital 83,887
Trade Creditors 19,840
Sales 259,870
Returns outwards 13,407
Provision for doubtful debts 512
Discounts allowed 2,306
Discounts received 1,750
Purchases 135,680
Returns inwards 5,624
Carriage outwards 4,562
Drawings 18,440
Carriage inwards 11,830
Rent, rates and insurance 25,973
Heating and lighting 11,010
Postage, Stationery and telephone 2,410
Advertising 5,980
Salaries and wages 38,521
Bad debts 2,008
Cash in hand 534
Cash at bank 4,440
Stock as at 1May 2004 15,654
Trade Debtors 24,500
Fixtures and fittings at cost 120,740
Provision for depreciation Fixtures 63,020
Depreciation 12,074
The following information was availed as at 30 April 2005:
a) Stock at the close of business was Sh.17,750,000 b) Insurance has been pre-paid by Sh.1,120,000 c) Heating and lighting is accrued by Sh.1,360,000 d) Rates have been pre-paid by Sh.5,435,000 e) The provision for doubtful debts is to be adjusted so that it is 3% of trade debtors.
REQUIRED (i) repare r aaras trading prit and ss aunt r the year ended th April 2005. (12marks)
(ii) Prepare his balance sheet as at that date. (8marks)
QUESTION THREE (Total Marks – 10) A company started its business on 1st January 2003. The financial year end being 31st
December. The following machineries were acquired.
2003 1 January Machine DX001 costing Sh.1.4m
2004 1 July 2 Machines DX002 and DX003 @Sh.0.6m each.
1October Machine DX004 Sh.1m
2006 1 April Machine DX005 Sh0.4m
REQUIRED
a) Show the machinery account (3marks) b) Show the provision for depreciation account for the machine (7marks)
N/B: Depreciation is over ten years, using straight line method, Machines being depreciated for the proportion of the year that they are owned.
QUESTION FOUR (Total Marks - 10)
Explain the meaning of the following concepts as used in accounting.
(i) The accrual concept (3marks)
(ii) Materiality concept (3marks)
(iii) Prudence concept (2marks)
(iv) Consistence concept (2marks)
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