While revising for his O levels last yr, a student of mine
passed me this question from his teacher. He said the
teacher claimed nobody from St Gab's passed the paper because of
this 32-mark question. Sry I can't seem to format it nicely
(can't tab, insert ms doc tables, pdf?).
Incomplete records (analysis) question from 2007 St Gab's Sec
Prelim:
Zaphaniah is a sole trader who started his business on 1 January
2003 at a rented premises with an annual rent of $36 000. His
business ends its financial year on 31 December annually. Zaphaniah
does not keep a proper set of accounts, but has made the following
information available for the year ended 31 December 2006
31 Dec 2005
31 Dec 2006
$
$
Stock
3320
5621
Debtors
4290
11540
Creditors
1780
3150
Prepaid advertising expenses
222
300
Accrued motor repairs
111
70
Unused stationery
20
15
Bank Loan
20000
20000
Bank
6500
Cr
?
Motor vehicles
45000
?
Shop fittings
12000
?
Provision for depreciation
- Motor vehicles
18000
?
- Shop fittings
1800
?
Additional information:
(i) Stock costing $820 had been sent to a customer on a ‘sale or
return’ basis on 29 November 2006. These goods were not sold and
were returned by the customer on 2 January 2007.
(ii) Summarised Cash Book information in respect of the year’s
transactions to 31
December 2006 was as follows
$
Cash takings banked
12 000
Cash payments from takings:
Stationery
90
Carriage on purchases
230
Drawings for personal use 1 560
Motor repairs
2 745
Office expenses
325
Creditors
300
Cheque banked:
Proceeds from personal investment
4 000
Debtors
54 382
Debts previously written off as bad debts 1 210
Cheques Issued:
Purchases
560
Creditors
16 670
Rent
29 000
Insurance
3 500
Household expenses
1 200
Advertising
4
200
Shop fittings
2
600
Wages
7 200
Carriage on sales
1 400
(iii) Total amount of credit note issued and received are $110 and
$190 respectively.
(iv) The cash discount columns of the Cash Book show the
following totals:
Debit total $ 90
Credit total 200
(v) On 31 December 2006, a contra entry was made to record Ben’s
balance of $300 and $20 respectively in Zaphaniah’s Purchases
Ledger and Sales Ledger.
(vi) $70 of debt owed by a customer was deemed irrecoverable and
was written off during the year.
(vii) Depreciation has to be charged at 20% p.a. on the net book
value of motor vehicles and 5% p.a. on the cost of shop
fittings.
(viii) ¼ of wages was for packaging of goods resale.
(ix) Insurance was paid for 5 months ended 28 February 2007.
(x) A provision for doubtful debts of 2% has to be created for
December 2006.
(xi) Interest on loan is to be charged at 6% p.a.
(xii) Bank statement received on 31 December 2006 revealed the
following discrepancies:
$
Unpaid cheques
80
Standing order - electricity
320
Credit transfer – commission received 2 640
REQUIRED
(a) Prepare the Trading and Profit and Loss Account for the year
ended 31 December 2006. [22]
(b) Prepare the Balance Sheet as at 31 December 2006. [10]
[Total : 32]
