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1. An entity controls the asset as a result of past events.
2. It is probable that future economic benefits associated with the asset will flow to the entity.
3. The fair value or cost of the asset can be measured reliably
Wilfykil answered the question on February 11, 2019 at 08:10
- Determine:
(i) A schedule showing the profit (or loss) which should be recognized in the profit and loss account of Mwako and Mjengo for each of...(Solved)
Mwako and Mjengo is a firm building contractors. The following information pertains to its uncompleted contracts as at 31 December 2003:
Date posted: February 11, 2019. Answers (1)
- In the context of accounting for long-term construction contracts, briefly explain the following terms:
(i) Retention money
(ii) Escalation clause(Solved)
In the context of accounting for long-term construction contracts, briefly explain the following terms:
(i) Retention money
(ii) Escalation clause
Date posted: February 11, 2019. Answers (1)
- Determine:
(i) Trading, profit and loss account for the year ended 31 March 2006.
(ii) Balance sheet as at 31 March 2006(Solved)
Kopesha Limited has been in business for several years dealing in electronic goods. All the firm’s goods are sold on hire purchase terms. The following trial balance extracted from the books of the firm as at 31 March 2006:
Date posted: February 11, 2019. Answers (1)
- Distinguish between “leasing” and “hire purchase” highlighting how each is accounted for.(Solved)
Distinguish between “leasing” and “hire purchase” highlighting how each is accounted for.
Date posted: February 11, 2019. Answers (1)
- Determine:
a) The value of closing stock as at 31st March 2007
b) Hire purchase debtors account as at 31 March 2007
c) Trading and profit and loss...(Solved)
Maridadi company ltd,sells high resolution television sets on both cash basis and hire purchase terms each television costs sh 16,000 and is sold at sh20,000 on cash basis. If a television set is sold on hire purchase terms a deposit of sh5,000is paid followed by ten installments of sh2,000 each . The company recognizes gross profit on television sets sold on hire purchase terms based on cash collected in the period and excludes television sets n hire-purchase terms from its closing stock. The company has a policy of valuing television sets repossessed from hire-purchase customers who have defaulted on payment at 60% of the unpaid installments. Repossessed television sets are sold on cash basis at the same gross profit rate television sets sold on cash
basis. Provided below is the trial balance of the company as at 31` March 2007
Date posted: February 11, 2019. Answers (1)
- Using the percentage of completion method, prepare the following in the books of Ujenzi contruction ltd
i) Profit and loss account for each of the three...(Solved)
On 1 January Ujenzi construction Ltd was awarded a contract for the construction of a road .The contract was for a three year period. The contract price was sh 250 million. The following information has been extracted from the books of the company
Date posted: February 11, 2019. Answers (1)
- Explain the following methods used in accounting for construction contracts
i. Completed contract method
ii. Percentage of completion method(Solved)
Explain the following methods used in accounting for construction contracts
i. Completed contract method
ii. Percentage of completion method
Date posted: February 11, 2019. Answers (1)
- Prepare the following in the books of Witu ltd
i) Consignment account
ii) Goods sent on consignment account
iii) Goods damaged in transit account(Solved)
Witu ltd, operates in Mombasa and deals in electronic goods, Most of these goods are sold through consignee of these consignees Mbaka Ltd,operates in Kitui town.
Witu ltd received the following account sales from Mbaki Ltd.
The account sales of 240 television sets received from the sold on account of Witu ltd of
Mombasa
Date posted: February 11, 2019. Answers (1)
- For each of the years ended 31 December 2006, 2007 and 2008, prepare extracts of financial statements using the percentage of completion approach in line...(Solved)
Date posted: February 11, 2019. Answers (1)
- Juhudi Contractors carried out work on four construction contracts during the financial year ended 30 September 2009.(Solved)
Juhudi Contractors carried out work on four construction contracts during the financial year ended 30 September 2009.
Date posted: February 11, 2019. Answers (1)
- Wonderful Bikes Ltd. is a retail outlet which sells motorbikes both on cash and hire purchase terms.
The following information was extracted from the books of...(Solved)
Wonderful Bikes Ltd. is a retail outlet which sells motorbikes both on cash and hire purchase terms.
The following information was extracted from the books of account of Wonderful Bikes Ltd. as at 31 August 2011:
Date posted: February 11, 2019. Answers (1)
- Differentiate between defined benefit and defined contribution plans(Solved)
Differentiate between defined benefit and defined contribution plans
Date posted: February 11, 2019. Answers (1)
(Solved)
Date posted: February 11, 2019. Answers (1)
- Explain the disclosure requirements for contracts in progress at the end of the reporting period in accordance with International Accounting Standard (IAS) 11, Construction Contracts.(Solved)
Explain the disclosure requirements for contracts in progress at the end of the reporting period in accordance with International Accounting Standard (IAS) 11, Construction Contracts.
Date posted: February 11, 2019. Answers (1)
- Explain two methods of accounting for construction contracts.(Solved)
Explain two methods of accounting for construction contracts.
Date posted: February 11, 2019. Answers (1)
(Solved)
Date posted: February 11, 2019. Answers (1)
- Three firms of accounts decided to amalgamate into a new firm Cheloti Gusera Kandie & Co. with effect from 1 April 1999. Until 31 March...(Solved)
Three firms of accounts decided to amalgamate into a new firm Cheloti Gusera Kandie & Co. with effect from 1 April 1999. Until 31 March 1999 Apopo. Cheloti and Chuma were partners in Apopo Cheloti & Co. sharing capital and profits equally. Guserwa. Kurgat and
Ochieng were partners in Guserwa & Co. sharing capital and profits in the ratio 4:4:1. Kandie was a sole practitioner.
The balance sheets of the firms as at 31 March 1999 were as follows:
Date posted: February 11, 2019. Answers (1)
- Maina and Ojara have been in partnership for a number of years sharing profits in the ratio 3:2. Because of the present difficult economic situation...(Solved)
Maina and Ojara have been in partnership for a number of years sharing profits in the ratio 3:2. Because of the present difficult economic situation in the country, it has been agreed that in the period ended 30 April 2000, no salaries will be paid to the partners and no drawings will be made either. Interest has been credited to the partners in respect of their capital accounts. They decided to turn the partnership into a company on 30 April 2000, with its accounts being made up to 30 April each year. They decided that they would not open a separate set of accounts on 30 April 2000, but would continue to record the transactions of the business in the partnership books.
The trial balance extracted by the accountant, after he had computed the profit for the period ended 30 April 2000 and the year ended 30 April 20001, was as follows:
Required:
(a). Prepare the Realisation and Capital Accounts of Maina and Ojaro to record the dissolution of the partnership.
(b). Prepare for Maoja Limited the income statement for the year ended 30 April 2001 and the balance sheet at that date in conformity with Kenya Companies Act and the International Accounting Standards. Do not prepare the statement of changes in equity – deal with dividends proposed and paid in the income statement. Ignore deferred tax.
Date posted: February 11, 2019. Answers (1)
- Emojong, Barmoi and Kimani have been partners sharing profits and losses in the ratios 2:2:1. Accounts have been prepared on an annual basis to 31...(Solved)
Emojong, Barmoi and Kimani have been partners sharing profits and losses in the ratios 2:2:1. Accounts have been prepared on an annual basis to 31 December of each year Emojong the only active partner, died on 31 May 2002 and the remaining partners decided to cease business from that date. The assets are to be realized, outstanding debts paid and the remainder to be shared by the partners (including the executors of Emojong’s estate) in an equitable manner, distributions of cash being made as soon as possible.
A balance sheet prepared as at 31 May 2002 revealed the following position
Date posted: February 11, 2019. Answers (1)
- Ali and Bali are in partnership trading as A and B Retailers. Similarly, Cheche and Dunga are in partnership trading as C and D Traders....(Solved)
Ali and Bali are in partnership trading as A and B Retailers. Similarly, Cheche and Dunga are in partnership trading as C and D Traders. It was mutually agreed that as at 1 January 2004, the partnership businesses be amalgamated into one firm, ABC and D Enterprises. The profit and loss sharing ratios of the partners both in the old and new partnership were as follows:
Date posted: February 11, 2019. Answers (1)