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In a business enterprise that has not kept proper books of accounts, what does an increase in capital at the end of the year over capital at the beginning of the year represent?
A. Increase in capital
B. Decrease in capital
C. Underutilization of resources
D. Inefficient management of capital
E. Improved operating performance
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Where there are no proper books of account, the equity at the commencement of a period is ascertained by preparing:
A. Statement of profit or loss
B. Statement of financial position
C. Statement of affairs
D. Bank reconciliation statement
E. Receivables and payables account
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Find Related Questions by Tags, levels, etc.
Adamu does not keep complete accounting records. However, you were able to extract the following information from the available records for the year ended 31 December 2012:
| ₦ | |
|---|---|
| Cash purchases | 234,000 |
| Cash and cheque payments for goods supplied | 1,671,000 |
| Trade payables at 1 January 2012 | 58,200 |
| Trade payables at 31 December 2012 | 43,200 |
What was Adamu’s purchases for the period?
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In preparing a set of final accounts from incomplete records, which of the following information need NOT be considered?
A. Business structure
B. Accounting and business equations
C. Credit sales and trade receivables
D. Purchases, inventory, and the cost of sales
E. Stolen goods, goods destroyed, or goods taken by the owner of the business
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For most small businesses, accounting records are either not available or incomplete. Which of the following business equations will be most appropriate to use in determining closing net assets?
A. Opening net assets + drawings – profit + capital introduced
B. Capital introduced + profit + drawings – opening net assets
C. Opening net assets + capital introduced + loss – drawings
D. Opening net assets + capital introduced + profit + drawing
E. Opening net assets + capital introduced + profit – drawings
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Peju runs a big grocery store in Ibadan, but many of her accounting records were destroyed by a flood incident close to the end of the financial year of the business. From the records that were retrieved after the incident, the following balances were gathered in respect to her assets and liabilities at the beginning of the year:
In addition, you were informed that:
(i) Inventory was valued at N46,510,000, trade receivables at N20,680,000, and trade payables at N15,430,000.
(ii) Sundry expenses accrued amounted to N370,000 for 2016.
(iii) Depreciation is to be provided as follows: furniture and fittings 10% and motor vehicle 20% on reducing balance method.
(iv) Peju took some groceries from the store costing N2,060,000. She is yet to pay.
(v) Allowances for doubtful debts are raised at the beginning and end of the year at 5%. Bad debts of N600,000 had been written off the trade receivables as at December 31, 2017.
(vi) The insurance policy redeemed was to be used as additional capital.
Required:
a. Calculate the capital as at January 1, 2017. (6 Marks)
b. Prepare the statement of profit or loss for the year ended December 31, 2017. (8 Marks)
c. Prepare the statement of financial position as at December 31, 2017. (6 Marks)
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The basic features of the single entry system of accounting are:
A. Books of accounts are not maintained and business relies only on bank statement
B. The journal records are absent and only the main ledger is kept
C. There are incomplete classifications and recording of accounting procedures
D. Only credit sales transactions and credit purchases are recorded
E. Only debit entries are made
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Amaka runs a pharmaceutical shop. She does not keep complete accounting records.
The following summary was extracted from her bank account for the year ended December 31, 2020:
| ₦ | ₦ |
|---|---|
| Balance b/d | 907,500 |
| Cheques from customers | 17,817,250 |
| Cash sales | 1,470,375 |
| Total Receipts | 20,195,125 |
| Payments | |
| Payment to trade suppliers | 10,316,375 |
| Electricity | 408,750 |
| Telephone | 135,000 |
| Rent | 810,000 |
| Advertising | 536,250 |
| Furniture and fittings | 1,956,250 |
| Insurance | 354,750 |
| Motor vehicle expenses | 793,500 |
| Drawings | 2,278,625 |
| Balance c/d | 2,605,625 |
| Total Payments | 20,195,125 |
Additional Information:
| January 1, 2020 | December 31, 2020 |
|---|---|
| Inventory of Drugs: ₦1,200,000 | ₦1,523,625 |
| Trade Receivables: ₦991,125 | ₦1,504,500 |
| Trade Payables: ₦599,250 | ₦916,875 |
| Motor Vehicles: ₦2,912,500 | |
| Shop Fittings: ₦1,575,000 | |
| Motor Vehicle Expenses Owing: ₦162,000 | ₦109,125 |
| Insurance Paid in Advance: ₦66,375 |
Depreciation of motor vehicles is at 20% per annum, and the furniture and fittings at 10% per annum. Depreciation is calculated using the reducing balance method.
Required:
(a) Calculate sales and purchases for the year ended December 31, 2020. (10 Marks)
(b) Prepare the statement of profit or loss for the year ended December 31, 2020. (5 Marks)
(c) Prepare the statement of financial position as at December 31, 2020. (5 Marks)
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
In a business enterprise that has not kept proper books of accounts, what does an increase in capital at the end of the year over capital at the beginning of the year represent?
A. Increase in capital
B. Decrease in capital
C. Underutilization of resources
D. Inefficient management of capital
E. Improved operating performance
Find Related Questions by Tags, levels, etc.
Where there are no proper books of account, the equity at the commencement of a period is ascertained by preparing:
A. Statement of profit or loss
B. Statement of financial position
C. Statement of affairs
D. Bank reconciliation statement
E. Receivables and payables account
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Adamu does not keep complete accounting records. However, you were able to extract the following information from the available records for the year ended 31 December 2012:
| ₦ | |
|---|---|
| Cash purchases | 234,000 |
| Cash and cheque payments for goods supplied | 1,671,000 |
| Trade payables at 1 January 2012 | 58,200 |
| Trade payables at 31 December 2012 | 43,200 |
What was Adamu’s purchases for the period?
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In preparing a set of final accounts from incomplete records, which of the following information need NOT be considered?
A. Business structure
B. Accounting and business equations
C. Credit sales and trade receivables
D. Purchases, inventory, and the cost of sales
E. Stolen goods, goods destroyed, or goods taken by the owner of the business
Find Related Questions by Tags, levels, etc.
For most small businesses, accounting records are either not available or incomplete. Which of the following business equations will be most appropriate to use in determining closing net assets?
A. Opening net assets + drawings – profit + capital introduced
B. Capital introduced + profit + drawings – opening net assets
C. Opening net assets + capital introduced + loss – drawings
D. Opening net assets + capital introduced + profit + drawing
E. Opening net assets + capital introduced + profit – drawings
Find Related Questions by Tags, levels, etc.
Peju runs a big grocery store in Ibadan, but many of her accounting records were destroyed by a flood incident close to the end of the financial year of the business. From the records that were retrieved after the incident, the following balances were gathered in respect to her assets and liabilities at the beginning of the year:
In addition, you were informed that:
(i) Inventory was valued at N46,510,000, trade receivables at N20,680,000, and trade payables at N15,430,000.
(ii) Sundry expenses accrued amounted to N370,000 for 2016.
(iii) Depreciation is to be provided as follows: furniture and fittings 10% and motor vehicle 20% on reducing balance method.
(iv) Peju took some groceries from the store costing N2,060,000. She is yet to pay.
(v) Allowances for doubtful debts are raised at the beginning and end of the year at 5%. Bad debts of N600,000 had been written off the trade receivables as at December 31, 2017.
(vi) The insurance policy redeemed was to be used as additional capital.
Required:
a. Calculate the capital as at January 1, 2017. (6 Marks)
b. Prepare the statement of profit or loss for the year ended December 31, 2017. (8 Marks)
c. Prepare the statement of financial position as at December 31, 2017. (6 Marks)
Find Related Questions by Tags, levels, etc.
The basic features of the single entry system of accounting are:
A. Books of accounts are not maintained and business relies only on bank statement
B. The journal records are absent and only the main ledger is kept
C. There are incomplete classifications and recording of accounting procedures
D. Only credit sales transactions and credit purchases are recorded
E. Only debit entries are made
Find Related Questions by Tags, levels, etc.
Amaka runs a pharmaceutical shop. She does not keep complete accounting records.
The following summary was extracted from her bank account for the year ended December 31, 2020:
| ₦ | ₦ |
|---|---|
| Balance b/d | 907,500 |
| Cheques from customers | 17,817,250 |
| Cash sales | 1,470,375 |
| Total Receipts | 20,195,125 |
| Payments | |
| Payment to trade suppliers | 10,316,375 |
| Electricity | 408,750 |
| Telephone | 135,000 |
| Rent | 810,000 |
| Advertising | 536,250 |
| Furniture and fittings | 1,956,250 |
| Insurance | 354,750 |
| Motor vehicle expenses | 793,500 |
| Drawings | 2,278,625 |
| Balance c/d | 2,605,625 |
| Total Payments | 20,195,125 |
Additional Information:
| January 1, 2020 | December 31, 2020 |
|---|---|
| Inventory of Drugs: ₦1,200,000 | ₦1,523,625 |
| Trade Receivables: ₦991,125 | ₦1,504,500 |
| Trade Payables: ₦599,250 | ₦916,875 |
| Motor Vehicles: ₦2,912,500 | |
| Shop Fittings: ₦1,575,000 | |
| Motor Vehicle Expenses Owing: ₦162,000 | ₦109,125 |
| Insurance Paid in Advance: ₦66,375 |
Depreciation of motor vehicles is at 20% per annum, and the furniture and fittings at 10% per annum. Depreciation is calculated using the reducing balance method.
Required:
(a) Calculate sales and purchases for the year ended December 31, 2020. (10 Marks)
(b) Prepare the statement of profit or loss for the year ended December 31, 2020. (5 Marks)
(c) Prepare the statement of financial position as at December 31, 2020. (5 Marks)
Find Related Questions by Tags, levels, etc.
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