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Hbc2104:Introduction To Accounting Ii Question Paper

Hbc2104:Introduction To Accounting Ii

Course:Bachelor Of Commerce

Institution: Meru University Of Science And Technology question papers

Exam Year:2012

QUESTIONONE (30 MARKS)
The following extracts were obtained from the books of Mema Ltd AS AT 31.10.2011.
DR (SH). CR (SH).
STOCKS, 1.11.010 500,000
Freehold Promises 2,400,000
Notes receivable 300,000
Purchases 2,800,000
Salaries and wages 850,000
Sales 5,200,000
Fixtures and fittings 250,000
Discount allowed 75,000
Discounts received 45,000
Plant and machinery 1, 400,000
Rate and licences 56,000
Advertising 104,000
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Insurance 38,000
General expenses 72,000
Provision for bad debts 18,000
Notes payable 140,000
Trade creditors 400,000
Cash 24,000
Bank overdraft 186,000
Water and electricity 60,000
Preference dividends in arrears 40,000
100,000 ordinary shares sh. 20 each 2,000,000
Rent income 500,000
Profit and loss account 1.11.010 200,000
Share premium 400,000
General reserves ______ 200,000
10% cumulative preference shares sh.20 each 200,000 200,000
Notes:
1. Depreciate plant and machinery at 8% on cost fixtures and fittings at 10% pm cost. 2. Stock as at 31.10.11 sh.600, 000. 3. Prepaid insurance sh. 5000 interest on overdraft had accrued by sh.18, 600 and salaries had accrued b y sh.186, 000. 4. Decrease provision for bad debts to 2%. 5. The company and Kenya Revenue Authority have assessed tax for the year and mutually agreed to be sh. 200,000. 6. Director proposed to i. Transfer sh. 100,000 to the general reserve. ii. Pay all preference dividends in areas and for the year. iii. Pay 15% dividends on ordinary share capital. iv. Paysh.80, 000 and sh. 120,000as audit fees and directors fees respectively.
Required:
Prepare for Mema Ltd.
a. Trading, profit and loss account for the year ended 31.10.2011. (10 Marks) b. Profit loss appropriation account. (10 Marks)
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c. Balance sheet as at 31.10.11 ( 15 Marks)
QUESTION TWO (15 MARKS)
a. Using relevant examples, explain the meaning of the following terms as used in accounting for partners and the relevant accounting treatment. i. Salary to a partner (2 Marks) ii. Interest on partners capital accounts (2 Marks) iii. Partners current accounts (2 Marks) b. The following balances were extracted from the books of Mbili and tatu partnership for the year ended 31.12.011. Sh.
Capital accounts (1.1.011) mbili 60,000
Tatu 80,000 Current accounts (1.1.011) mbili 15,000 Tatu (DR) 9,000 Drawings for the year mbili 6,000 Tatu 9,000 Net profit for the year 32,450 The partnership deed provides for: 1. Interest allowed on partners capital at the rate of 10%p.a. 2. Tatu to be allowed a monthly salary of sh. 1,100. 3. Interest charged on drawing at 10% p.a. 4. Profit and losses to be shared between mbili and tatu in the ratio 2:3 respectively.
Required:
Partners current accounts as at 31.12.11 (9 Marks)
QUESTION THREE (15 MARKS)
The following schedule of balances was extracted from the books Njambi enterprises as at 31st August 2011.
Stocks as at 1.9.010 sh. (0000)
Raw materials 13,550
Work in progress 6,500
Finished goods 12,800
Purchases and expenses for the year to 3.8.11 sh.(000)
Raw materials 237,650
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Indirect expenses 1,850
Direct expenses 53,230
Factory lightning and heating 4,550
Office lightning and heating 1,975
Printing and stationery 1,264
Postage and telephone 520
Factory salaries 11,500
Office salaries 9,900
Factory insurances 450
Depreciation
Factory equipment and machinery 5,000
Office equipment and machinery 650
Office expenses 1,680
Advertising 850
Sales of finished goods 378,150
Other information
i. Finished goods manufactured are transferred from the factory at a manufacturing price of cost of production plus 10%. ii. Stocks at 31.8.011 sh.(000) Raw materials 24,000 Work in progress 7,987 Finished goods 18,050 iii. Prepayment as at 31.8.11 sh. (000) Factory insurances 116 Other insurances 45
Accruals as at 31.8.11 sh.(000)
Direct wages 1,342
Factory heating and lighting 197
Office heating and lighting 43
Factory power 350
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Required: Prepare the manufacturing account for the year ended 31st August 2011.
QUESTION FOUR (10 MARKS)
The following is the receipts and payments account of Nyambene social club for the year ended 31st December 2011.
SH. SH.
Entrance fees 108,800 balance b/d
Subscriptions 277,000 1.1.2011 45,000
Donations 100,000 bar purchases 720,000
Dance tickets 49,000 bar man salaries 72,000
Receipts from debtors 800,000 bank deposit 100,000
Bar expenses 18,800
Club expenses 41,200
Sport equipments 140,000
Balance c/d 197,000
1,334,800 1,334,800
Balance b/d 197,800
Notes:
I. Balances as at 1.1. 2011 sh. Subscription in advance 16,000 Subscription in arrears 36,000 Bar stock 25,000 Bar debtors 400,000 II. Balances as at 31.12.2011 sh. Bar stock 70,000 Bar debtors 900,000 2,400 III. Subscriptions received during the year included sh. 22,000 for the year ended 31st December 2010 and sh. 4,000 for the ending 31st December 2012. IV. Subscriptions in arrears for more than one year are to be written off.
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For the year ended 31st December 2011 prepare:
a. Bar trading account (4 Marks) b. Income and expenditure account (6 Marks)

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Hbc2104:Introduction To Accounting Ii Question Paper

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