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Seminar Question Double Entry

learn double entry

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7 views

Seminar Question Double Entry

learn double entry

Uploaded by

benezethmtuka0703
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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INSTITUTE OF ACCOUNTANCY ARUSHA

DEPARTMENT OF ACCOUNTING AND FINANCE


EXERCISES ON DOUBLE ENTRY BOOKKEEPING
Example 1. Mshanga commenced business on 1st June 2016. With capital in cash Shs.250, 000.

June 1. Bought goods for cash 50,000

1. Sold goods for cash 40,000

2. Paid wages in cash 3,000

3. Paid cash for goods bought 60,000

4. Cash sale to date 60,000

5. Sold goods for cash 20,000

6. Paid carriage on goods 2,000

8. Cash sale to date 30,000

8. Purchased goods for cash 80,000

9. Paid wages in cash 3,000

10. Cash sale to date 80,000

11. Purchased goods for cash 65,000

11. Paid carriage on purchases 1,500

25. Cash purchases 60,000

27. Cash sales to date 60,000

30. Paid wages in cash 3,000

Post the above transactions in the ledger and balance the accounts at the end of the month.

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Example 2. SIFUNI MMARI commenced business on 1st January 2016 with Shs.60, 000 in cash.

Jan. 2. Purchased goods for cash 5,800

3. Sold goods for cash 3,200

5. Paid cash to cleaner 600

8. Paid cash for traveling expenses 600

8. Bought goods for cash 3,000

11. Purchased stationery for cash 1,500

13. Sold goods and received cash 7,100

18. Paid wages in cash 800

21. Sold goods for cash 9,000

28. Paid rent in cash 15,000

29. Paid sundry expenses in cash 1,000

30. Sold more goods for cash 4,600

REQUIRED: Record the above transactions in double entry form, completing the dual aspect of each
transaction. Balance off the accounts clearly showing the carried down and brought down balances.

CHAPTER REVIEW QUESTIONS

1. What do you understand by the term “Double – Entry”?


2. Under double entry accounting any business transaction affects two or three accounts, the sub
division of the ledger are, Personal, Real and Nominal

In each of the following transactions show the type of accounts being affected.

Example:

TRANSACTION NOMINAL REAL PERSONAL

(i) Deposited cash to start business v v

TRANSACTIONS:

1. Started business with 20Million as capital

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2. Bought goods on credit for sale

3. Sold goods for cash

4. Deposited money into the bank

5 Bought office furniture by cheque

6. Sold goods on credit

7. Drew cash from bank

8. Bought goods for sale by paying cash

9. Drew cash for personal use

10. Paid wages by cheque

11. Returned goods to supplier

12. Received a cheque from Maganga as part settlement of his debt.

3. Complete the following table showing which accounts are to be debited and which are to be credited.

Accounts to Accounts to

Be debited be credited

(a) Pay a creditor by cheque


(b) Purchase a motor van on credit from CMC Ltd
(c) A debtor gives us cash in settlement of his account
(d) We borrow from W. Kaiza who sent us his cheque
(e) The proprietor introduces extra cash into the business
(f) Sold surplus equipment on credit to S. Mayenga
(g) Repaid by cheque a loan from H. Duhia
(h) Paid cash into bank
(i) Gave cash to a customer C. Bwashe who had previously overpaid his account
(j) Received a cheque from a customer in payment of his account.

4. What are the advantages of the double entry system?

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5. Record the following transactions in the ledger accounts of Mr. Mshana, a shopkeeper in Majengo. These
transactions took place in July 2015.

July 1. Started business with capital in cash. 600,000

2. Bought goods for cash 350,000

3. Bought furniture paying for them by cash 50,000

4. Bought scales for cash 20,000

5. Cash sales to date 45,000

7. Bought goods for cash 20,000

8. Paid transport charges 2,800

10. Paid electricity bill 8,500

15. Sold goods for cash 250,000

20. Paid rent 25,000

22. Bought goods for cash 150,000

23. Paid transport charges 2,000

25. Cash sales to date 90,000

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