- The following financial statements were extracted from the books of Salama Ltd.
Income Statement
For year ended 30 June 2009
...(Solved)
The following financial statements were extracted from the books of Salama Ltd.
Income Statement
For year ended 30 June 2009
Sh.
"million"
Revenue 5,800
Cost of sales (3,468)
Gross profits 2,332
Administrative expenses (684)
Distribution expenses (1,040)
Profit from Operations 608
Income from investment 10
Finance cost (38)
Profit before tax 580
Income tax expense (208)
Net profit for the year 372
Statement of financial position as at 30 June
Assets: 2009 2008
Sh. "million" Sh. "million"
Non-Current Assets 1,268 1,020
Current Assets
Inventory 840 920
Trade receivables 780 640
Interest receivable 8 18
Investment 100 -
Cash at Bank 150 -
Cash in Hand 14 10
1,892 1,588
Total assets 3,160 2,608
Equity and Liabilities
Capital and Reserves
Ordinary Share capital of sh. 0.50 each 726 600
Share premium 178 184
Revaluation reserve 100 -
Retained profits 126 (140)
1,130 644
Non-Current Liabilities
10% Loan - 80
5% Loan 658 698
658 778
Current Liabilities
Bank overdraft - 140
Trade payables 1,100 800
Current tax 200 180
Other payables 72 66
1,372 1,186
Total capital and Liabilities 3,160 2,608
Additional information
1. On 1 July 2008, Salama Ltd issued 120 million ordinary shares of sh. 0.50 par value each at sh. 1.00 each. The proceeds from the issue were used to liquidate the 10% loan and some of the 5% loan, both at par. On 1 August 2008, Salama ltd. made a bonus issue of one share for every ten held. All the shares in issue qualified for the bonus shares.
2. Non-current tangible assets include properties which were revalued during the year ended 30 June 2009. An item of equipment and machinery with a total net book value of sh. 150 million was disposed of during the year for sh.196 million.
3. The total depreciation charged on property, plant and equipment during the year ended 30 June 2009 was sh. 174 million.
4. Salama Ltd. paid an interim dividend of sh.106 million during the year
5. Other payables include interest payable amounting to sh.66 million and sh.12million as at 30 June 2008 and 2009 respectively.
Required:
Statement of cash flows for the year ended 30 June 2009 in conformity with the requirements if International Accounting Standard (IAS) 7, “Statement of Cash flows”.
Date posted: October 4, 2022. Answers (1)
- Ephraim started a business as a sole trader on 1 January 2007. He did not maintain a double entry system of accounting. The business transactions...(Solved)
Ephraim started a business as a sole trader on 1 January 2007. He did not maintain a double entry system of accounting. The business transactions were made by cheque although occasionally some daily expenses were paid from cash sales or money withdrawn from the bank.
The receipts and payments of the sole proprietorship for the year ended 31 December 2008 are summarized below:
Receipts Sh. "000" Payments Sh. "000"
From trade receivables 2,350,000 Salaries and wages 220,000
capital introduced 60,000 Rent and insurance 110,000
Motor vehicle expenses 135,000
Trade payables 2,120,000
Travelling expenses 20,000
Drawings 164,000
Printing and stationary 8,200
Electricity 15,300
Telephone 15,500
The balances of assets and liabilities as at 31 December 2007 and 2008 were as follows:
2007 2008
Sh. Sh.
Cash at bank 300,000 180,000
Cash in hand 40,000 12,000
Trade receivables ? 1,800,000
Inventories 500,000 620,000
other receivables - 12,000
Motor vehicles (Cost) 450,000 450,000
Furniture and fittings ( Cost) 115,000 115,000
Trade payables 1,840,000 1,850,000
Other Payables - 27,500
Additional information
1. Sales were made at a uniform gross profit margin of 25%
2. Discount allowed and discount received during the year ended 31 December 2008 amounted to sh. 140,000 and sh. 120,000 respectively.
3. As at 31 December 2008, other receivables and other payables included the following accruals and
prepayments:
Accruals: Sh.
Telephone 3,500
Salaries and wages 24,000
Prepayments: Sh.
Rent 10,000
Electricity 2,000
4. Depreciation is to be provided on motor vehicles using the sum-of-digits method. The useful life of the motor vehicle is 5 years. Depreciation is to be provided on furniture and fittings at the rate of 10% using straight-line method.
5. A specific allowance for bad debts of sh.90,000 is to be made on 31 December 2008.
Required:
(a) Income statement for the year ended 31 December 2008.
(b) Statement of financial position as at 31 December 2008.
(c) Outline four benefits that Ephraim would derive from using a computerized accounting system.
Date posted: October 4, 2022. Answers (1)
- ABK Ltd. was incorporated on 1 January 2002. The authorized share capital of ABK Ltd. is sh. 50million
divided into 5million ordinary shares of sh. 10...(Solved)
ABK Ltd. was incorporated on 1 January 2002. The authorized share capital of ABK Ltd. is sh. 50million
divided into 5million ordinary shares of sh. 10 each. On 10 January 2009, the directors of the company
offered for sale to the public 2 million shares at a premium of sh.2 per share. The issued share capital of ABK Ltd. before this offer to the public was sh.30million. The 2million shares issued to the public were to be paid as follows;
Date Sh
On application 30 January 2009 3
On allotment 12 February 2009 4
On first call 12 March 2009 3
On Second and final call 10 April 2009 2 (premium)
Applications for 2,100,000 shares were received and allotment done on a pro-rata basis on 2 February 2009.
Excess money on application was utilized to meet part of the monies due on allotment.
The balance of the monies due on allotment, first call and second and final calls were received on the due dates. However, one allottee for 30,000 shares failed to pay for the two calls while another allottee for 20,000 shares did not pay for the second and final call. The 50,000 shares were subsequently forfeited and re-issued at sh. 7 per share, money being on 30 April 2009.
Required:
Ledger accounts, except bank account, to record the above transaction
Date posted: October 4, 2022. Answers (1)
- Differentiate between the following
(i) Rights issue and bonus issue
(ii) Preference shares and share premium(Solved)
Differentiate between the following
(i) Rights issue and bonus issue
(ii) Preference shares and share premium
Date posted: October 4, 2022. Answers (1)
- Briefly explain two benefits and two limitations of an accounting standard(Solved)
Briefly explain two benefits and two limitations of an accounting standard
Date posted: October 4, 2022. Answers (1)
- Maxwel and Ken are partners trading as Makena Brick Manufacturers. The following balances were extracted from the books of Makena Brick manufacturers as at 31...(Solved)
Maxwel and Ken are partners trading as Makena Brick Manufacturers. The following balances were extracted from the books of Makena Brick manufacturers as at 31 July 2009.
Sh. "000"
Plant and Machinery at cost (1 August 2008) 72,000
Loose tools at cost (1 August 2008) 21,000
Sales 182,000
Raw materials purchased 55,000
Motor vehicles at cost (1 August 2008) 42,000
Direct factory wages 51,000
Electricity 17,000
Indirect factory wages 20,000
Machinery repairs 13,600
Motor vehicle expenses 24,000
Rent and insurance 23,600
Administrative staff salaries 43,000
Administrative expenses 21,000
sales and distribution staff salaries 25,000
Capital (1 August 2008)
Maxwell 150,000
Ken 140,000
Accounts receivables 28,500
Accounts payables 23,200
Balance at bank 20,500
Drawings
Maxwell 10,000
Ken 8,000
Additional information
1. The estimated useful life of plant and machinery is 10 years while that of motor vehicles is 4 years. The company uses the straight-line method to provide for depreciation on property, plant and equipment
2. Inventories as at 31 July 2009 were as follows
Sh.
Raw materials 19,000,000
Finished goods 10,000,000
Work-in-progress 24,300,000
3. As at 31 July 2009, accrued electricity amounted to sh. 13,000,000 while prepaid rent and insurance amounted to sh. 9,800,000
4. The following expenses are to be apportioned between the factory and the administration in the ratios indicated below
Factory Administration
Electricity 2/3 1/3
Rent and insurance ¾ ¼
Motor vehicle running expenses ½ ½
Depreciation on motor vehicles ½ ½
5. Loose tools as at 31 July 2009 were valued at sh. 17,000,000
6. Goods were transferred from the factory to the warehouse at sh. 107,000,000
7. Provision for doubtful debts is to be made at 5% of the accounts receivable
8. The partners share profits and losses equally
Required:
(i) Manufacturing and income statement for the year ended 31 July 2009
(ii) Statement of financial position as at 31 July 2009
Date posted: October 4, 2022. Answers (1)
- Explain three roles of International Accounting Standards Board (IASB). (Solved)
Explain three roles of International Accounting Standards Board (IASB).
Date posted: October 3, 2022. Answers (1)
- Alloys Ltd. is a small enterprise with a turnover of sh.10million. The firm sells tyres and related products to various customers both on credit and...(Solved)
Alloys Ltd. is a small enterprise with a turnover of sh.10million. The firm sells tyres and related products to various customers both on credit and cash terms. Currently, the firms accounting systems are manual. The management of Alloys Ltd. is considering computerizing its accounting systems
Required:
(i) Advise Alloys Ltd. of six essential accounting information systems that could be implemented in the
computerized project.
(ii) Explain the benefits that would accrue to Alloys ltd. as a result of computerizing its accounting system.
(iii) Highlight the challenges Alloys Ltd. is likely to face in the computerization project
Date posted: October 3, 2022. Answers (1)
- The approved estimates and actual expenditure of the Ministry of Youth and Sports for the financial year ended 30 June 2009 were as follows;
Item ...(Solved)
The approved estimates and actual expenditure of the Ministry of Youth and Sports for the financial year ended 30 June 2009 were as follows;
Item Details Estimates Actual
Sh. Sh
2110100 Basic salaries 61,000,000 59,500,000
2110300 Other personal allowances 23,200,000 21,900,000
2210100 Utilities, supplies and services 73,100,000 66,450,000
2210300 Domestic travel and Subsistence 5,000,000 4,950,000
2210500 Printing and Stationary 4,500,000 4,050,000
2210700 Training expenses 6,400,000 6,390,000
2220200 Maintenance of Equipment 1,000,000 900,000
2230100 Grants to youth clubs 5,000,000 5,000,000
Gross expenditure 179,200,000 169,140,000
Appropriation-In-Aid
Receipts not classified
1450100 elsewhere 12,000,000 10,500,000
Net expenditure 167,200,000 158,640,000
Drawings from the exchequer during the financial year ended 30 June 2009 amounted to sh. 160,000,000
Required:
(a) Exchequer account
(b) General account of vote
(c) Paymaster general (PMG) account
(d) Appropriation account for the year ended 30 June 2009
(e) Statement of assets and liabilities as at 30 June 2009
Date posted: October 3, 2022. Answers (1)
- The following is the receipts and payments account of “The Professional club” for the year ended 30 September 2009:
Additional information
1. The professional club premises...(Solved)
The following is the receipts and payments account of “The Professional club” for the year ended 30 September 2009:
Additional information
1. The professional club premises was acquired for sh.29,000,000. The provision for depreciation on the
premises as at 30 September 2008 amounted to sh.18,800,000. The old bus disposed of during the year cost
sh.12,190,000 and the accumulated depreciation as at 30 September 2008 was sh.10,290,000
2. Depreciation is to be provided as follows
Asset rate per annum
Club premises 5% on reducing balance basis
Bus 15% based on cost
3. The following balances as at 30 September 2008 and 2009 have been provided by the club
2008 2009
Sh. "000" Sh. "000"
Subscriptions due 1200 980
Accruals on printing 90 30
Bar inventory 710 870
Accruals on bar purchases 590 430
Required:
(a) Income statement for the year ended 30 September 2009
(b) Statement of financial position as at 30 September 2009
Date posted: October 3, 2022. Answers (1)
- The following information relates to Pambazuka ltd. for the month of August 2009:
...(Solved)
The following information relates to Pambazuka ltd. for the month of August 2009:
Sh.
Credit sales 3,800,000
Discount received 75,600
Return outwards 90,100
Interest charged to credit customers 200,500
Discount allowed 100,900
Receipts from credit customers 3,306,400
Payments to credit suppliers 3,800,000
Bad debts written off 80,700
Customers' cheques dishonoured (including
cheque over the counter by customers - sh.
380,000 965,000
Credit Purchases 3,950,000
Allowance for doubtful debts (established at the
end of the month) 640,000
Trade payables ledger (credits transferred to trade
receivables ledger 214,600
Trade receivables balances as at 1 August 2009 2,100,000
Trade payables balances as at 1 August 2009 800,000
Additional information
1. Estimated price adjustments and other allowances on outstanding trade receivables amounted to sh.180,000
2. Claims by Pambazuka Ltd. for price reductions on defective goods as agreed with suppliers was sh. 107,800 while the return inwards was sh.120,000
3. Ninety (90) percent of customers with outstanding accounts on 31 August 2009 took discounts in the first week of September 2009. The company offers a cash discount of 2% on sales
4. Amounts totaling sh.28,600 written off in the month of June 2009 were collected in the month of August 2009 and credited to suspense account
5. On 31 August 2009 customers’ accounts with credit balances amounted to sh.450,000 and suppliers’
accounts with debit balances amounted to sh.213,400
6. One invoice of sh.75,000 was posted to the trade receivables ledger as sh.57,000
7. A reconciliation of the trade receivables control account with the trade receivables ledger balances on 31 July 2009 revealed a difference of sh.60,000. In August 2009, this difference was discovered to have been caused by failure to add one invoice of the same amount to the July 2009 sales invoice total that was posted to the trade receivables control account. The invoice had been correctly posted to the trade receivables ledger.
8. The financial year end of pambazuka Ltd. is 31 August
Required:
(i) Trade receivables ledger control account
(ii) Trade payables ledger control account
(iii) A schedule showing how trade receivables would appear in the statement of financial position as at 31 August 2009
Date posted: October 3, 2022. Answers (1)
- Distinguish between bad debts and allowance for doubtful debts(Solved)
Distinguish between bad debts and allowance for doubtful debts
Date posted: October 3, 2022. Answers (1)
- Martin Stanley is a sole proprietor. He does not maintain a double entry system of accounting.
The following information was extracted from the books of the...(Solved)
Martin Stanley is a sole proprietor. He does not maintain a double entry system of accounting.
The following information was extracted from the books of the business as at 31 March 2008:
Sh.
Freehold property 900,000
Motor Vehicles 1,125,000
Inventory 585,000
Trade payables 570,000
Trade receivables 750,000
10% Bank Loan 600,000
Bank Overdraft 90,000
Other payables (electricity) 22,500
Prepayments (wages) 60,000
Allowance for doubtful debts 37,500
Additional information
1. Inventory as at 31 March 2009 was valued at sh. 645,000
2. The following transactions were carried out through the bank account during the year ended 31 March 2009:
Sh.
Receipts from trade receivables 2,835,000
Cash sales 1,080,000
Payments to trade payables 2,910,000
Cash purchases 360,000
Proceeds from sale of motor vehicle 180,000
Salaries and wages 240,000
General expenses 90,000
Electricity 60,000
Interest on loan 30,000
Drawings 105,000
3. Sales and purchases on credit amounted to sh. 3,120,000 and sh. 2,850,000 respectively
4. Interest on loan was paid on 30 September 2008
5. The discount received and discount allowed during the year amounted to sh.60,000 and sh.105,000
respectively.
6. Bad debts written off during the year amounted to sh.30,000. Allowance for doubtful debts is to be made at 5% of the trade receivables as at 31 March 2009
7. Accrued electricity was sh.28,000 while prepaid salaries amounted to sh.42,000 as at 31 March 2009
8. Motor vehicles are to be depreciated using reducing balance method at the rate of 20% per annum. A full year’s depreciation is provided in the year of purchase and non in the year of disposal. The Motor vehicle sold during the year had been purchases at sh.400,000 on 1 January 2006
Required:
(a) Income statement for the year ended 31 March 2009
(b) Statement of financial position as at 31 March 2009
Date posted: October 3, 2022. Answers (1)
- The following revenue information was obtained from the books of account of the Ministry of Local
Government for the year ended 30 June 2009
...(Solved)
The following revenue information was obtained from the books of account of the Ministry of Local
Government for the year ended 30 June 2009
Estimated revenue Actual receipts
Sh. "000" Sh. "000"
Rent from buildings and Equipment 850,000 870,000
Fees from trading licenses 430,000 400,000
Fees from import and export licenses 470,000 480,000
Other receipts 235,000 210,000
Additional information
1. The balances at hand on 30 June 2008 amounted to sh. 247,000,000
2. The balances at hand on 30 June 2009 amounted to sh. 160,000,000
Required:
Revenue account for the ended 30 June 2009
Date posted: October 3, 2022. Answers (1)
- In the context of public sector accounting, explain the following terms
(i) Budgetary accounting
(ii) Cash accounting
(iii) Accruals accounting
(iv) Commitment accounting
(v) Fund accounting(Solved)
In the context of public sector accounting, explain the following terms
(i) Budgetary accounting
(ii) Cash accounting
(iii) Accruals accounting
(iv) Commitment accounting
(v) Fund accounting
Date posted: October 3, 2022. Answers (1)
- The financial statements of Savannah Ltd. for the year ended 30 April 2009 and 30 April 2010 are given below:
Income Statement for the years ended...(Solved)
The financial statements of Savannah Ltd. for the year ended 30 April 2009 and 30 April 2010 are given below:
Income Statement for the years ended 30 April
2010 2009
Sh. "000" Sh. "000"
Revenue 396,900 378,000
Cost of sales (217,140) (219,240)
Gross profits 179,760 158,760
Administrative expenses (31,563) (29,589)
Distribution expenses (35,070) (32,865)
Profit from Operations 113,127 96,306
Finance cost (17,115) (14,784)
Profit before tax 96,012 81,522
Income tax expense (42,000) (28,980)
Net profit for the year 54,012 52,542
Extract of the statement of changes in equity (retained earnings) for the year ended 30 April:
2010 2009
Sh. "000" Sh. "000'
Opening balance 135,114 116,172
Net profit for the year 54,012 52,542
Ordinary dividends paid (35,553) (33,600)
Balance as at 30 April 153,573 135,114
Statement of financial position as at 30 April
Assets: 2010 2009
Non-Current Assets Sh. "000" Sh. "000"
Property, Plant and Equipment 443,961 427,476
Current Assets
Inventory 55,923 37,275
Trade receivables 47,460 30,240
Bank balances 1,113 1,050
104,496 68,565
Total assets 548,457 496,041
Equity and Liabilities
Equity and Reserves
Called up share capital 168,000 168,000
Retained profits 153,573 135,114
321,573 303,114
Non-Current Liabilities
12% Loan notes 105,000 105,000
Current Liabilities
Trade payables 8,148 8,190
Bank overdraft 48,800 27,300
Tax payable 64,936 52,437
121,884 87,927
Equity and Liabilities 548,457 496,041
Required:
(a) For each year, compute the following ratios
(i) Gross profit margin
(ii) Profit margin
(iii) Return on capital employed
(iv) Current ratio
(v) Acid test ratio
(vi) Inventory turnover
(vii) Trade receivables collections period
(b) Citing relevant ratios computed in (a) above, briefly comment on the performance of savannah Ltd. using the following criteria
(i) Profitability
(ii) Liquidity
(iii) Efficiency
Date posted: October 3, 2022. Answers (1)
- Explain four benefits that would accrue to a country from adopting International Financial Reporting
Standards (IFRSs)(Solved)
Explain four benefits that would accrue to a country from adopting International Financial Reporting
Standards (IFRSs)
Date posted: October 3, 2022. Answers (1)
- Abdi and Barasa were partners in a Wholesale business sharing profits and losses in the ratio of 3:2 respectively after allowing for interest on capital...(Solved)
Abdi and Barasa were partners in a Wholesale business sharing profits and losses in the ratio of 3:2 respectively after allowing for interest on capital at the rate of 10% per annum. On 1 October 2009, they admitted Chale into the partnership. Chale paid his capital and goodwill contributions of sh. 400,000 and sh. 200,000 respectively in cash.
The partners agreed to allow interest on capital at the rate of 10% per annum and to write off the goodwill paid on admission of Chale. Chale was to share ¼ of the profit and losses of the partnership.
Abdi and Barasa were to share the balance of the profits and losses in the ratio 3:2 respectively. For purposes of admission of Chale into the partnership, Land and Buildings were valued as sh. 2,000,000 on 1 October 2009.
The trial balance extracted from the books of the partnership as at 31 March 2010 was as follows:
Sh. "000' Sh. "000"
Capital accounts
Abdi 900
Barasa 600
Capital introduced by Chale 400
Cash premium paid by Chale 200
Current accounts
Abdi 300
Barasa 200
Drawings
Abdi 100
Barasa 80
Chale 60
Inventory (1 April 2009) 200
Purchase/Sales 5,000 9,000
Administrative expenses 1,600
Selling and distribution costs 1,050
Allowance for doubtful debts 100
Trade receivables /payables 600 500
Land and Buildings 1,400
Equipment at cost 2,000
Provision for depreciation 800
Bank balance 910
13,000 13,000
Additional information
1. Inventory as at 31 March 2010 was valued at sh. 400,000
2. As at 31 March 2010, accrued administrative expenses amounted to sh. 150,000 while prepaid selling and distribution costs amounted to sh. 50,000
3. Depreciation is to be provided on equipment at the rate of 20% per annum based on cost
4. Allowance for doubtful debts is to be increased to sh. 150,000 of which sh. 30,000 relates to the period 1 April 2009 to 30 September 2009
5. Assume sales , gross profit and expenses accrue evenly throughout the year
Required:
(a) Income statement for the year ended 31 March 2010
(b) Statement of financial position as at 31 March 2010
Date posted: October 3, 2022. Answers (1)
- Sabuni Ltd is a medium-sized factory producing a soap branded “malaika”. The following trial balance was
extracted from the books of the company as at 31...(Solved)
Sabuni Ltd is a medium-sized factory producing a soap branded “malaika”. The following trial balance was
extracted from the books of the company as at 31 December 2009.
Sh. “000” Sh. “000”
Ordinary share capital 100,000
10% preference share capital 40,000
15% debentures 20,000
Share premium 2,000
General reserves 6,000
Retained profits 900
Sales 116,400
Purchases of raw materials 24,800
Inventory (1 January 2009)
Raw materials 1,300
Work-in-progress 4,770
Finished goods (90,000units) 8,100
Land 100,000
Buildings (cost) 60,000
Provision for depreciation 6,000
Plant and Machinery at Net book value 4,600
Interest on debentures 1,500
Direct labour 10,800
Carriage inwards 100
Purchase returns 200
General factory costs 1,600
General administrative expenses 20,000
Electricity and water expenses 2,000
Insurance 1,800
Royalty expenses 2,300
Selling and distribution costs 8,200
provision for unrealized profits 1,350
Bank balance 24,000
Motor vehicles at cost (for sales men) 8,000
Provision for depreciation 2,000
Interim dividends paid to preference shareholders 2,000
Trade payables 5,150
Trade receivables 14,130
300,000 300,000
Additional information
1. Inventories as at 31 December 2009 were valued as follows
Sh. "000'
Raw materials 1,500
Work-in-progress 3,100
2. Depreciation is to be provided annually as follows
Buildings at 10% based on cost
Motor Vehicles at 25% based on cost
Plant and Machinery at 30% using reducing method
3. The company apportions expenses between factory and administration in the following ratios;
Factory Administration
Depreciation on buildings 80% 20%
Electricity and water 60% 40%
Insurance 75% 25%
4. Sabuni Ltd. produced 600,000 units and sold 582,000 units during the year. Assume finished goods were
sold on a first-in-first-out basis
5. Finished goods are transferred to the warehouse at cost plus a mark-up of 20%
6. As at 31 December 2009, six month’s interest on the 15% debentures was outstanding while accrued labour costs amounted to sh. 400,000
7. The directors propose to pay the preference shareholders a final dividend. In addition, the directors propose to pay the ordinary shareholders a dividend of 15% per share after the transfer of sh. 4,000,000 to the general reserve.
8. Corporation tax is estimated at sh. 9,900,000
Required:
(a) Manufacturing account and Income statement for the year ended 31 December 2009.
(b) Explain four benefits that would accrue to a country from adopting International Financial Reporting
Standards (IFRSs)
Date posted: October 3, 2022. Answers (1)
- Nguvumali, a Sole Trader who operates a small business in Mombasa, does not keep proper books of account. He had instructed his shop assistant, who...(Solved)
Nguvumali, a Sole Trader who operates a small business in Mombasa, does not keep proper books of account. He had instructed his shop assistant, who absconded duty on 30 March 2010 with an unknown amount of cash, to collect trade receivables and to bank the cash intact.
Given below are the balances extracted from the records of the firm as at 31 March
2009 2010
Sh. "000" Sh. "000'
Buildings 20,000 20,000
Equipment at cost 8,000 8,000
Accumulated depreciation 800 ?
Motor vehicles at cost 8,000 8,000
Accumulated depreciation 2,000 ?
Inventory 7,000 ?
Trade receivables 5,000 4,000
Bank overdraft 4,200 ?
Cash in hand 100 100
Prepaid electricity 100 60
Accrued salaries and wages 600 400
Trade payables 2,000 3,000
Additional information
1. The following transactions were made during the year ended 31 March 2010
Sh. "000"
Cheques paid to trade creditors 41,000
Cash banked during the year 59,940
Cash paid for electricity and water expenses 160
salaries and wages paid through the bank 5,700
Cash withdrawn from the bank for office use 5,000
Cheques paid for selling and distribution costs 1,600
Cash drawings for personal use 3,000
Cash paid for general expenses 1,400
Returns inwards 9,000
Discount allowed 600
Bad debts written off 400
Cash from trade debtors 60,000
Discount received 1,000
2. The firm applied a uniform mark-up of ¾
3. Depreciation on motor vehicles and equipment is to be provided based on cost and annual rates of 25% and 10% respectively. Ignore depreciation on buildings
4. Nguvumali did not have an insurance policy to cover theft by servants
Required:
(a) Determine the amount of cash stolen by the shop assistant
(b) Income statement for the year ended 31 March 2010
(c) Statement of financial position as at 31 March 2010
Date posted: October 3, 2022. Answers (1)