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2. (a) Oliver Bentley maintains control accounts in his general ledger. He prepared a Sales Ledger
Control Account for January 2004, with information derived from his subsidiary books.
The debit balance shown in the Sales Ledger Control Account at January 31, 2004, does not
agree with the list of debtors extracted from the sales ledger at that date. The value of debtors
according to the sales ledger at January 31, 2004, was $14 872.

The following errors were subsequently discovered:

1. K. Boodraj, a bad debtor whose account had been written off in 2003, sent a cheque
for $198. The amount was entered in the sales ledger.

2. In January a page of the sales returns day book had been overcast by $200.

3. Discounts received of $156 had been mistakenly entered in the discounts allowed
column of the cash book in January 2004.

4. A debit balance of $824 on S. McCalla's account in the sales ledger had been set
off against his account in the purchases ledger. This entry had not been recorded
in either control account.

5. A $58 discount allowed to Ram Sookie had been correctly entered in the cash book
but had not been entered in Ram's account.

(i) Calculate the total of the debtors' balances at January 31, 2003, after the
errors have been corrected. (Show your workings.) ( 4 marks)

(ii) Calculate the total debtors' balance in Bentley's Sales Ledger Control
Account for the month of January 2004, before the errors had been
corrected. ( 8 marks)

(b) On April! , 2004, a business purchased a machine costing $224 000. The machine has a
lifeexpectancyofapproximately40months. Attheendofthattimethemachineisexpected
to have a trade-in value of $24 000. The financial year of the business ends on December
31, each year.

(i) Use the formula for calculating annual depreciation on the 'Straight-line Method'
to determine the annual depreciation on the machine. ( 2 marks)

(ii) Calculate the depreciation charge at the end of the first year. ( 1 mark)

(iii) Show the depreciation account for the first two years. (Smarks)

Total 20 marks

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01239020/F 2005
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SECTION II
Answ er any TWO questi ons in this sectio n.

debtors for the month of May

4. (a) Fraser Group Holdin gs provides the following inform ation about
2007
Detail s Amou nts
$
23 450 DR
Balanc es at May 1, 2007
610C R
Trans action s with debto rs for the month :
186
Disho noured chequ es
428
Bad debts
21013
Chequ es receiv ed
35 790
Credit sales
244
Return s inward s
139
Interes t charge d on late payme nts
50
Interes t receiv ed on late payme nts
2007. ( 7 marks )
Prepar e the appropriate Contro l Accou nt for the month of May
(b) Rishi Narine , Emplo yee Numb er 265 works for a compa ny which
pays a regula r rate of $12 per hour.
d in excess of 40 hours
pays one and one-ha lf time the regular rate for all hours worke
per week.
deduct s Nation al Insura nce of 2% of gross pay.
of 10% of gross pay.
makes as he reques ted, a regular payment to his credit union
.
deducts incom e tax at the rate of 20 cents on every dollar earned
a total of fifty (50) hours, ten (10)
During the week ending June 29, 2007, Rishi Narine worke d
of which were counte d as overtim e hours.
Narine. ( 7 marks )
On the answe r sheet provid ed, compl ete the pay slip for Rishi

(c) Roger s and Sons Ltd presen ts the following information.

Detail s Amou nts
$
Work in progre ss at March 1, 2007 2450

Raw materi als in stock at March 1, 2007 6920

Raw materi als purcha ses 45 890

Direct wages 123 800

Factor y overhe ads 56 200

Accru ed factory overhe ads 4 800

Work in progre ss at Augus t 31 , 2007 3 670

Raw materi als stock at Augus t 31 , 2007 5 710

for the six months ended Augus t

Prepar e the Manuf acturin g Accou nt for Rogers and Sons Ltd
( 6 marks )
31, 2007.
Total 20 marks
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0123 9020/JANUARYIF 2008
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3. The trial balance of Beck Hammond showed that the credit totals were greater than the debit
totals by $2 570. Mr. Hammond draws up his Profit and Loss Account which shows a Net Profit
of $15 750. He later discovers the following errors.

1. A purchase of furniture for $1 500 cash had been debited to the Purchases Account.

2. A payment of $2 000 by cheque had been made by customer Ronal Dinho whose account
was correctly credited but the amount was entered in the Bank Account as $200.

3. A discount allowed to Fergie Alexander of $256 was debited to the Discount Allowed
Account as $236.

4. Goods with a value of $3 700 sold to Russell Smith had been debited to Dwight Smith’s
Account.

5. A cheque for $375 drawn on behalf of Terry Henry had been credited to his account.

(a) (i) Draw up the Suspense Account and correct the errors that have caused the differ-
ence in Beck Hammond’s Trial Balance. ( 5 marks)

(ii) Draft the journal entries necessary to correct the errors which do not affect the
Suspense Account. ( 5 marks)

(iii) Draw up a statement to show the revised net profit. ( 3 marks)

(b) Lara Bryan has a large number of debtors. She keeps a Control Account in her General
Ledger. On March 31 2009, she extracts the following information.

2009 $
March 1 Sales ledger debit balance 5 030
March 1 Sales ledger credit balance 620
Credit sales for the month 54 010
Cash and cheques received 47 100
Bad debts written off 2 570
Discounts allowed 490
Returns inwards 1 240
Dishonoured cheques 980
Interest due on overdue accounts 180

(i) Prepare the Debtors Control Account for March 2009. ( 6 marks)

(ii) State ONE reason why Lara Bryan prepares a Control Account for debtors.
( 1 mark )

Total 20 marks

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01239020/JANUARY/F 2010
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3. (a) Khalel, the owner of Khalel’s Gardening Centre, kept only single entries of his transactions.
On January 31, 2010, he provided his bank manager with the following information but
could not answer a number of questions.

February 01, 2009 January 31, 2010

$ $

Property at cost 40 000 40 000

Motor van value at year end 9 000 7 000

Inventory 4 000 5 600

Accounts receivable (debtors) 1 475 2 300

Accounts payable (creditors) 925 850

Cash 1 240 2 360

Prepaid water rates 400 500

Electricity owing 210 110

The bank manager gave several reasons why this method was not very helpful. He also
advised Khalel about using different methods to convert his records to double entry records.

(i) State TWO limitations of single entry records. (2 marks)

(ii) Prepare a Statement of Affairs as at February 01, 2009, to convert Khalel’s Gardening
Centre’s single entry records. (5 marks)

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01239020/F 2010
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(b) Khalel also provided the following information:

1. All sales were made on credit. Debtors paid $32 600 by cheque during the year.
The account of one debtor for $75 had been written off as bad debt.

2. All purchases totalling $17 455 were made on credit.

3. In addition to other liabilities, Khalel borrowed $2 000 from his sister on February
01, 2009. This is to be paid by June 30, 2010. The interest rate was 5% per annum,
but neither the loan nor the interest due had been recorded.

4. All other expenses (including water rates and electricity) totalled $6 115 for the year.

(i)
Prepare a Sales Total (Control) Account for Khalel’s Gardening Centre to calculate
the total Credit Sales for the period ended January 31, 2010.
(3 marks)

(ii) Prepare an Income Statement for Khalel’s Gardening Centre for the year ended
January 31, 2010. (9 marks)

(iii)
In which classification section of the Balance Sheet should Khalel record the loan
from his sister?
(1 mark )

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01239020/F 2010
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3. (a) As at November 30, 2010 the following personal account balances existed in the Sales
and Purchases Ledgers of Smallmoon Enterprises.
Sales Ledger
Marshall $32 500

Purchases Ledger
Hamilton $19 290

The following information was extracted from the company’s day books for the month
of December 2010:

Sales Day Book

2010 $
Dec 4 Marshall 25 200
Dec 21 Marshall 8 002
Purchases Day Book
2010 $
Dec 6 Hamilton 3 150
Dec 29 Hamilton 2 250
Sales Returns Day Book
2010 $
Dec 6 Marshall 3 100
Purchases Returns Day Book
2010 $
Dec 11 Hamilton 415
CASH BOOK
Date Details Bank Date Details Bank
2010 $ 2010 Hamilton for Credit $
Dec 1 Bal b/d 5 200 Dec 28 Purchases 15 000

Dec 23 Marshall for Cash 400 Dec 28 Hamilton for Cash 500
Sales Purchases
Dec 23 Marshall for Credit 26 000 Dec 31 Bal c/d 16 100
Sales
31 600 31 600
2011
Jan1 Bal b/d 16 100

(i) Prepare and balance the personal accounts appearing in the ledgers of Smallmoon
Enterprises as at December 31, 2010. (9 marks)
(ii) Prepare and CLOSE the Sales and Purchases Accounts in the General Ledger of
Smallmoon Enterprises as at December 31, 2010. (4 marks)

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(b)
The following balances were taken from the books of Metal Works Enterprises
on April 30, 2010. An inexperienced bookkeeper placed some items in the wrong
column.


Dr ($) Cr ($)
Land and building 68 000
Bank overdraft 6 500
Cash on hand 3 200
Accounts receivable 49 000
Carriage inwards 1 500
Carriage outwards 2 700
Accounts payable 38 250
Rent received 10 200
Motor vehicles 36 000
Allowance for depreciation of motor vehicles 12 000
Purchases returns 600
Sales returns 1 100
Commission paid 1 600
Loans 25 000
Sales 105 400
Purchases 90 000
Drawings 6 200
Salaries 12 500

Rewrite the Trial Balance for Metal Works Enterprises in good style, including an amount
for capital. (7 marks)

Total 20 marks

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SECTION II

Answer any TWO questions in this section.

Mr Best prepared the following information in order to produce end-of-year figures for his final
4.
accounts.
$
Sales Ledger balances, January 1, 2010 – Debit 25 260
– Credit 540
Purchases Ledger balances, January 1, 2010 – Debit 350
– Credit 32 130
Total receipts from customers 392 690
Total payments to suppliers 308 160
Purchases on credit 321 100
Sales on credit 412 500
Discount allowed 3 220
Discount received 4 660
Return Inwards 2 100
Return Outwards 1 500
Bad debts written off 2 800
Balance in the Sales Ledger set off against balances in the Purchases Ledger 500
Sales Ledger balance December 31, 2010 – Debit ?
– Credit 360
Purchases Ledger balance December 31, 2010 – Debit 230
– Credit ?

(a) Prepare the Sales Ledger Control Account and the Purchases Ledger Control Account
for Mr Best, for the year ended December 31, 2010. (15 marks)

(b) Mr Best extracted a Trial Balance on July 31, 2010 which failed to agree by $7 425; a
shortage on the debit side of the Trial Balance. A Suspense Account was opened for the
difference.

In August 2010 the following errors were discovered.

1. Sales Day Book had been undercast by $4 100.

2. A cheque paying $3 500 to B. Ashton was entered in the Cash Book but not in
the Personal Account.

3. Inventory at close was under-valued by $3 900.

4. Discount received of $4 125 from a supplier was not posted to the supplier’s
account.

Write up the Suspense Account showing the correction of the errors. (5 marks)

Total 20 marks

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Return Inwards Day Book

2011 Amount
3 September U. Plumber $1 000
9 September V. Henry $1 950
$2 950

Cash Book

Disc Cash Bank Disc Cash Bank

2011 $ $ $ 2011 $ $ $
1 Sept Bal b/d 2 645 10 500 25 Sept Rent 700
4 Sept U. Plumber 100 5 100 25 Sept Wages 2 500
24 Sept V. Henry 60 6 040
30 Sept Bal c/d 1 945 19 140
160 2 645 21 640 2 645 21 640

(i) Post the information from the day books in the personal account of U. Plumber and balance
the account. (3 marks)

(ii) Prepare the Debtors Control Account and any other account in the General Ledger for the
month of September. (4 marks)

Total 20 marks

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2. (a) The table below shows sources of the Debtors’ Ledger Control Accounts.

Source of Information Book of Original Entry

Total refund to debtors Cash Book
Total dishonoured cheques
Total credit sales
Total returns inwards
Receipts from debtors
Total discounts allowed
Total bad debts

Copy the table in your answer booklet and complete it to show the Book of Original Entry
for EACH source of information. An example is given. (6 marks)

L. Somerset presented the following information for the month of October 2012:

$
Creditors ledger control account credit balance b/d 25 400
Creditors ledger control account debit balance b/d 1 450
Returns outwards 1 200
Purchases for the quarter 123 900
Payments to creditors 100 300
Refund by cheque from creditor due to damaged item 1 180
Discounts received 2 500
Cheque returned by creditor — presented too late to bank 3 300
Set off of credit amount between debtors ledger and creditors ledger 620
Received from creditor due to overpayment 284

(b) Prepare the Purchases Ledger Control Account for L. Somerset for the month of October
2012. (9 marks)

On 1 November 2012, L. Somerset discovered the following errors in the accounts.

(i) A purchase of equipment worth $2 100 had been included in the purchases figure.

(ii) The cheque used to pay a creditor had been entered in the bank account as
$12 960 instead of $12 690.

(c) Use the general journal to correct the TWO errors above. Narrative for EACH journal
entry is required. (5 marks)

Total 20 marks

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2. JT Enterprises, whose purchases and sales are all on credit, prepares Control Accounts at the end
of every month.

At the end of April 2014, JT Enterprises provided the following information on its accounts payable
and its accounts receivable.

Accounts Payable
$
Opening balances 5 100 (Cr), $310 (Dr)
Purchases for the month of April 63 720
Purchases returns 620
Payments to suppliers 59 970
Discounts received 1 200
Prepayment by cheque to suppliers 3 450
Late payment charge 45
Closing balance 270 (Dr)

Accounts Receivable

Opening balances 9 360 (Dr), $470 (Cr)

Sales for the month of April 87 890
Sales returns 1 330
Receipts from customers 69 110
Discounts allowed 1 200
Bad debts 1 320
Customer’s cheque returned 970
Closing balance 550 (Cr)

Note: A firm, Escrow Ltd, is a supplier and a customer of JT Enterprises. At 30 April, Escrow
Ltd’s balances in the ledgers of JT Enterprises were as follows:

Purchases Ledger $ 1 050

Sales Ledger $ 375

The firm sets off the appropriate amount through the Control Accounts.

(a) State ONE reason why Control Accounts would be useful to JT Enterprises. (1 mark)

(b) Prepare the following Accounts for JT Enterprises:

(i) Purchases Ledger (Accounts Payable) Control Account (8 marks)

(ii) Sales Ledger (Accounts Receivable) Control Account (11 marks)

Total 20 marks

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5. (a) The accounting department of Cav Crafts provided the following information from its
various books.

September 2013 August 2014

$ $

Credit purchases 196 700

Credit sales 262 920

Accounts receivable 5 010 7 800

Accounts payable 3 950 2 830

Cash received from accounts receivable 257 800

Cash paid to accounts payable 194 400

Discounts allowed 1 040

Discounts received 3 560

Sales returns 1 290

Purchases returns 1 740

Interest on late payments received from accounts

receivable 660

Refunds for overpayments from accounts payables 1 880

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Using the information on page 20 prepare EACH of the following accounts for the year
ended 31 August 2014:

(i) Accounts Receivable Control Account

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(ii) Accounts Payable Control Account

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SECTION I

Answer the THREE questions in this section.

Write your answers in the spaces provided in this booklet.

1. RAHALI SECURITY and FIRST CALL TRANSPORT

Rahali Security Enterprise buys and sells security devices only on credit. During the month of
May, some accounting information was produced as follows:

– Amount owed to accounts payable on 01 May was $2390.

– Credit purchases for the month totalled $24 560.
– Defective devices returned to sellers were valued at $230.
– A debt to a creditor of $8770 was settled by cheque for $8300.
– Amount owed to accounts payable on 31 May was $4900.

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– Credit sales for the same month totalled $55 460.
– Discount allowed during a weeklong sale was $250.
– Accounts receivable on 31 May was $6170.
– Amount paid by accounts receivable totalled $53 140.

(a) (i) List any TWO journals which would provide some of the information given above.

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(ii) Using the information on page 4, prepare the Accounts Payable Control Account
for Rahali Security for the month ended May 2017. Be sure to label the balancing
figure in your answer.

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(7 marks)

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(iii) Using the information on page 4, prepare the Accounts Receivables Control
Account for Rahali Security for the month ended May 2017. Be sure to label the
balancing figure in your answer.

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(b) On 31 March 2017, the accountant at First Call Transport Company discovers three year-
end events that require entries in the General Journal as follows:

– A debtor had paid only 50% of the $3000 owed to First Call Transport. The money
received and the bad debt incurred had already been entered in the ledger.
– The company is to provide for bad debts at a rate of 2% of accounts receivable of
$43 600.
– The company had paid the sum of $18 000 to its landlord to cover the rent for a year
and a half.

Prepare the entries in the General Journal to show how these events affect the Income
Statement at the end of the accounting year of First Call Transport Company. Narratives
are NOT required.

First Call Transport Company

General Journal

Debit Credit
Date Details
($) ($)
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(7 marks)

Total 20 marks
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