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- The trial balance for XYZ ltd at 31 December 2013 showed a difference of Sh. 8,000, being a shortage on the debit side. Show the...(Solved)
The trial balance for XYZ ltd at 31 December 2013 showed a difference of Sh. 8,000, being a shortage on the debit side. Show the journal entries to correct the following errors and prepare a suspense account.
1. Extra capital of Sh. 5,000 paid into the bank had been credited to sales account.
2. Sales account had been overcast by Sh. 9000
3. Insurance expense was undercast by Sh. 4,000
4. Private rent of Sh. 1,900 had been debited in the rent account.
5. Cash of Sh. 5000 received from a debtor was entered in the cash book only.
6. A credit purchase of Sh. 5,900 was entered in the books as Sh. 9,500
Date posted: August 17, 2021. Answers (1)
- MM Traders when preparing their financial statements realized the following errors upon investigation in the books of accounts.
a) Extra capital of Ksh 400,000 paid into...(Solved)
MM Traders when preparing their financial statements realized the following errors upon investigation in the books of accounts.
a) Extra capital of Ksh 400,000 paid into the bank had been credited to Sales account.
b) MM took goods for own use Ksh 7,000 but this had been debited to General Expenses.
c) Private insurance Ksh 1,500 had been debited to Insurance account.
d) A credit purchase of goods from ABC Ltd Ksh 35,000 had been entered in the books as Ksh 25,000.
e) Credit sales of Ksh 14,500 to Albert did not appear anywhere in the books.
f) Cash drawings of Ksh 4,000 had been credited to the bank column of the cashbook.
g) Returns inwards Ksh 16,800 from Simon had been entered in error in Simpson account.
h) A sale of a motor van Ksh 240,000 had been credited to Motor Expenses.
Required:
Prepare journal entries to correct the above errors.
Date posted: August 17, 2021. Answers (1)
- Describe a Suspense Account.(Solved)
Describe a Suspense Account.
Date posted: August 17, 2021. Answers (1)
- ABC Ltd has a cashier who was issued with Ksh 20,000 as the Cash Float at the beginning of the month of May, 2013. The...(Solved)
ABC Ltd has a cashier who was issued with Ksh 20,000 as the Cash Float at the beginning of the month of May, 2013. The following petty expenses were incurred during the month. Prepare a detailed petty cash book showing the balance to be carried forward to the next period.
.Ksh
02/05/2013: Bought stamps for 800
03/05/2013: Paid bus fare for 1,200
05/05/2013: Cleaning materials 2,400
07/05/2013: Bought fuel 1,500
10/05/2013: Cleaning wages 3,000
14/05/2013: Bought stamps 2,000
19/05/2013: Paid Jack (creditor) 4,000
22/05/2013: Fuel costs 1,500
24/05/2013: Bought 2 packets of biro pens 1,450
Date posted: August 17, 2021. Answers (1)
- Describe the Petty Cash Book and the Imprest system of Accounting.(Solved)
Describe the Petty Cash Book and the Imprest system of Accounting.
Date posted: August 17, 2021. Answers (1)
- Michael Kamau runs a general groceries shop in Nairobi. The following transactions relate to the shop for the month of September 2013.
Sept 1st : Cash...(Solved)
Michael Kamau runs a general groceries shop in Nairobi. The following transactions relate to the shop for the month of September 2013.
Sept 1st : Cash in hand Sh. 31,400; Bank balance Sh. 50,800; Capital account Sh. 82,200
Sept 3rd: Bought goods in cash for Sh. 8,200
Sept 4th: Purchased goods on credit from Jambo ltd for Sh. 11,600 less 10% trade discount.
Sept 7th: Sold goods on credit to Simon at Sh. 17,800 less 20% trade discount.
Sept 10th: Withdrew cash from the bank amounting to Sh. 1,000 for private use.
Sept 12th: Sold goods on credit to Eric at Sh. 12,800.
Sept 14th: Paid Sh. 10,000 in cash to Jambo ltd in full settlement of their account.
Sept 15th: Received Sh. 8,000 in cash from Eric in part settlement of his account
Sept 17th: Goods worth Sh. 800 were returned by Eric.
Sept 21th: Purchased goods on credit at Sh. 17,400 from Shauri ltd.
Sept 24th: Paid Sh. 12,000 to Shauri ltd by cheque; discount given was Sh. 600.
Sept 25th: Purchased furniture on credit from Magic furniture for Sh. 16,000
Sept 26th: Transferred Sh. 4,400 from the cash till to the bank account.
Sept 27th: Eric was declared bankrupt and could only pay Sh.2,000 of the debt by cheque the rest being treated as a bad debt.
Sept 28th: Goods worth Sh. 1,200 were returned to Shauri ltd.
Sept 29th: Goods worth Sh. 800 were taken by Michael Kamau for his personal use.
Sept 29th: Paid Sh. 1000 by cheque for advertising.
Sept 29th: Paid wages to shop assistant in cash amounting to Sh. 3,600.
Sept 29th: Made cash sales of Sh. 43,600
Sept 29th: Banked Sh. 40,000
Sept 29th: Received cash of Sh. 11,800 from Simon in part payment of their account after allowing a discount of Sh. 200.
Required;
a) Record the above transactions in the appropriate ledger accounts including the three column cash book.
b) Extract a trial balance as at 30th September 2013.
Date posted: August 17, 2021. Answers (1)
- Mwananchi traders had the following account balances as at 1st January 2013.
Cash Ksh 2,900
Bank Ksh 65,400(Solved)
Mwananchi traders had the following account balances as at 1st January 2013.
Cash Ksh 2,900
Bank Ksh 65,400
Debtors accounts: Creditors accounts:
Benson Ksh 12,000 Unity Ltd Ksh 6,000
Nathan Ksh 28,000 ABC Ltd Ksh 44,000
Dennis Ksh 4,000 Riper Ltd Ksh 10,000
The following transactions also took place in the month of January;
02/01/2013: Benson cleared his account by cheque after deducting 8% cash discount.
08/01/2013: Mwananchi traders paid Riper Ltd by cheque less 5% cash discount.
11/01/2013: Made drawings for Ksh 10,000 from the bank for business use.
16/01/2013: Nathan paid us his amount due by cash after deducting 3% discount allowed.
25/01/2013: Mwananchi traders paid office expenses in cash for Ksh 9,200.
28/01/2013: Dennis settled his account by cash.
29/01/2013: Paid Unity Ltd the amount due by cheque.
30/01/2013: Paid ABC Ltd partly Ksh 40,000 by cheque.
Prepare sales, purchases and general ledger books for the above information.
Date posted: August 17, 2021. Answers (1)
- The following details belong to JJ Wholesalers. Prepare a two column cashbook for the month ending March, 2013.
01/03/2013: Started business with capital inform of cash...(Solved)
The following details belong to JJ Wholesalers. Prepare a two column cashbook for the month ending March, 2013.
01/03/2013: Started business with capital inform of cash Sh. 100,000.
02/03/2013: Paid rent by cash Sh 10,000.
03/03/2013: Received Loan of Sh 500,000 via cheque from Barclays bank.
04/03/2013: Paid Kenya Motors Sh 65,000 by cheque.
05/03/2013: Made Cash sales of Sh 98,000.
07/03/2013: Nathan a debtor paid us by cheque Sh 62,000.
09/03/2013: Paid Bakes Ltd in cash Sh 22,000.
11/03/2013: Made cash sales paid directly into the bank for Sh 53,000.
15/03/2013: Gilbert paid us in cash Sh 65,000.
16/03/2013: Took Sh 50,000 out of the cash till and deposited it into the bank account.
19/03/2013: Made loan repayment of Sh 100,000 by cheque to Barclays Bank
22/03/2013: Made cash sales paid directly into the bank for Sh 66,000.
26/03/2013: Paid motor expenses by cheque Sh 12,000.
30/03/2013: Withdrew Sh 100,000 cash from the bank for business use.
31/03/2013: Paid wages in cash for Sh 97,000.
Date posted: August 17, 2021. Answers (1)
- What are Discounts?(Solved)
What are Discounts?
Date posted: August 17, 2021. Answers (1)
- Explain the types of cash books.(Solved)
Explain the types of cash books.
Date posted: August 17, 2021. Answers (1)
- Explain a Cash Book.(Solved)
Explain a Cash Book.
Date posted: August 17, 2021. Answers (1)
- Using a diagram, illustrate the Classification of Accounts.(Solved)
Using a diagram, illustrate the Classification of Accounts.
Date posted: August 17, 2021. Answers (1)
- Prepare journal entries to record the following transactions that took place in the month of February, 2013:
01/02/2013: Bought office fittings on credit from Heritage Ltd...(Solved)
Prepare journal entries to record the following transactions that took place in the month of February, 2013:
01/02/2013: Bought office fittings on credit from Heritage Ltd for Ksh 77,000.
05/02/2013: Goods costing Ksh 34,000 were taken out of the business without paying for them.
08/02/2013: Ksh 6,800 of the goods taken by us on 5th February is returned back into the business stock by us and no money is taken in exchange for the return.
13/02/2013: Johnson owes us Ksh 26,400 and he is unable to pay his debt so we agree to take some of his computers worth the same amount to cancel his debt.
17/02/2013: Paid Heritage Ltd Ksh 50,000 by cheque in partial settlement of the amount due.
25/02/2013: A debt owing to us by Hicks of Ksh 13,450 is written off as a bad debt.
28/02/2013: Bought equipment on credit from ART Ltd for Ksh 31,500.
Date posted: August 17, 2021. Answers (1)
- Record the following entries in a journal for the year 2011.
- On May 1st bought a vehicle on credit from Kenya motors for Kshs 96,000.
-...(Solved)
Record the following entries in a journal for the year 2011.
- On May 1st bought a vehicle on credit from Kenya motors for Kshs 96,000.
- On May 3rd a debt of Kshs 6,000 owing from John was written off as a bad debt.
- On May 8th credit purchase of furniture for 12,500 was returned to the supplier BB ltd as it was unsuitable and full allowance will be given.
- On May 12th a Ken a debtor who owed us Kshs 4,000 was declared bankrupt and we received Kshs 1050 in full settlement of the debt.
- On May 14th we take goods costing Kshs 3,500 out of the business stock without paying for them.
- On May 28th we discovered that Kshs 1,500 of the insurance paid, belonged to private use.
- On May 30th bought machinery for Kshs 25,000 on credit from Electronics ltd.
Date posted: August 17, 2021. Answers (1)
- Describe a General Journal.(Solved)
Describe a General Journal.
Date posted: August 17, 2021. Answers (1)
- The following transactions relate to Jasho Enterprises. Enter the transactions in the relevant books of original entry and show the postings made in the general...(Solved)
The following transactions relate to Jasho Enterprises. Enter the transactions in the relevant books of original entry and show the postings made in the general ledger.
2013
1/10/2013 Credit purchases from: Martin Sh. 38,000; Mark Sh. 5,000; Mike Sh. 1,060.
3/10/2013 Credit sales to: Rick Sh. 5,100; Raps Sh. 2,460; Rachael Sh. 3,560.
5/10/2013 Credit purchases from: Matthew Sh. 2,000; Mabel Sh.1,800 ; Marshal Sh. 4,100; Michael Sh.660.
8/10/2013 Credit sales to: Stephen Sh. 3,070; Stella Sh. 2,500; Samuel Sh. 1,850.
12/10/2013 Returns outwards to: Mark Sh. 300; Mike Sh. 160.
14/10/2013 Returns inwards from: Raps Sh. 180; Rachael Sh. 220.
20/10/2013 Credit sales to: Raps Sh. 1,880; Shakes Sh. 3,100; Slim Sh. 4,200.
24/10/2013 Credit purchases from: Peter Sh. 5,500; Patrick Sh. 9,000.
31/10/2013 Returns inwards from: Raps Sh. 270; Rick Sh. 300.
31/10/2013 Returns outwards to: Mabel Sh. 130; Michael Sh. 110.
Date posted: August 17, 2021. Answers (1)
- Describe a Return Outwards Journal.(Solved)
Describe a Return Outwards Journal.
Date posted: August 17, 2021. Answers (1)
- Describe a Return Inwards Journal.(Solved)
Describe a Return Inwards Journal.
Date posted: August 17, 2021. Answers (1)
- Describe a Purchases Journal.(Solved)
Describe a Purchases Journal.
Date posted: August 17, 2021. Answers (1)
- You are to enter up the sales journal from the following details. Post the items to the relevant accounts in the sales ledger and then...(Solved)
You are to enter up the sales journal from the following details. Post the items to the relevant accounts in the sales ledger and then show the transfer to the sales account in the general ledger.
Date posted: August 17, 2021. Answers (1)