BCM Sec 2D1 December’24 Holiday Homework
Name/Class: Pearl – sec 2D1
Duration: 2 hours
Date:_23_/_12_/_2024
Mark:
70 /84
Section A (18 marks)
1. Which statement about a trial balance is correct?
A) It is a list of the ledger balances on a particular date.
B) It is part of the double entry system of book-keeping.
C) It is proof that all items have been posted to the correct accounts.
D) It is proof that all transactions have been entered in the books of account. ( B )
(A)
2. The basic purpose of preparing a trial balance is:
A) To find out the profit of the business
B) To show the financial position of the business
C) To test the arithmetical accuracy of the ledger
D) To calculate the net purchases of the business
( C )
(B)
3. Which of the following is correct about an agreed trial balance:
(A) Both debit and credit aspects of each transaction have been recorded
(B) The books are arithmetically correct
(C) The debit and credit columns of trial balance have been correctly summed
(D) All of the above
( D )
4. Which of the following is the correct sequence of the accounting cycle:
(A) Journal > Trial balance > Ledger > Transaction Analysis
(B) Transaction Analysis > Journal > Ledger > Trial Balance
(C)Purchases > Journal > Ledger > Trial Balance
(D) None of the above
( B )
5. A trial balance prepared after taking into account the effect of adjusting entries is
known as:
(A) Financial trial balance
(B) Adjusted trial balance
(C) Unadjusted trial balance
(D) Normal trial balance
( B )
6. In addition to the arithmetical accuracy of ledger, a trial balance provides:
(A) A summary of total capital invested in the business during the period
(B) A summary of sales made during the period
(C) A summary of total cash collected from customers during the period
(D) A summary of all transactions made since the end of the previous accounting
period
( D )
7. Which of the following errors in the journal entry will not be detected by trial balance:
(A) The debit part is overstated but the credit part is correctly recorded
(B) The debit part is correctly recorded but the credit part is overstated
(C) Both the debit and credit parts are overstated by the same amount
(D) The debit part is correctly recorded but the credit part is understated
( C )
8. Which of the following is placed in the credit column of the trial balance:
(A) Purchases
(B) Rent expense
(C) Furniture
(D) Sales
( D )
9. Which of the following is placed in the debit column of the trial balance:
(A) Capital
(B) Accounts payable
(C) Salaries payable
(D) None of the above
( D )
10. In which book of prime entry does a trader record cash discount received?
(A) cash book
(B) general journal
(C) purchases journal
(D) sales journal
( A )
11. The analysis columns of a petty cash book show the following totals.
postage
stationery
12.
$
20
31
How should these totals be posted to the ledger?
(A) credit bank account with $51
(B) credit postage account with $20 and stationery account with $31
(C) debit cash account with $51
(D) debit postage account with $20 and stationery account with $31
( D )
Which business documents are not entered in the books of prime entry?
1. credit note
2. debit note
3. invoice
4. statement of account
(A) 1 and 3
(B) 1 only
(C) 2, 3 and 4
(D) 2 and 4 only
( D )
13.
Which business documents are used as sources of information to make entries in
the cash book?
(A) bank statement, cheque counterfoil, invoice, paying-in slip
(B) bank statement, cheque counterfoil, invoice, receipt
(C) bank statement, cheque counterfoil, paying-in slip, receipt
(D) cheque counterfoil, paying-in slip, petty cash voucher, receipt
( C)
14.
A book-keeper made two errors which cancelled each other out.
Which type of error did he make?
(A) compensating
(B) complete reversal
(C) original entry
(D) principle
15.
16.
(A)
The totals of a trial balance agree. What does this mean?
(A) All the arithmetic in the ledger is correct.
(B) All transactions have been entered in the correct ledger accounts.
(C) All transactions have been entered on the correct sides of the ledger.
(D) Total debit balances equal total credit balances in the ledger.
(D)
A cheque received from Joe was credited to Joanna’s account.
Which type of error was made?
(A) commission
(B) compensating
(C) original entry
(D) principle
( A )
17.
Identify which error would be disclosed by the preparation of a trial balance.
(A) Credit sales, $500, entered on both sides of the ledger as $50
(B) Discount allowed, $60, posted to the credit side of the discount allowed
account
(C) Purchases account and sales account both overcast by $650
(D) Purchases on credit, $290, omitted from the books
( B)
18.
A business maintains a petty cash book with a float of $300. During the month it
spent $185 on petty cash items.
Identify the amount required to restore the float at the end of the month.
(A) $485
(B) $300
(C) $185
(D) $115
(C)
Section B: (66 marks)
1. Lottie is a trader. Her financial year end is 30 April. She keeps her petty cash book
using the imprest system. The imprest amount is $150. The totals of the payments
analysis columns in her petty cash book for April 2024 are as follows.
$
Cleaning
21
Stationery
47
Sundry expenses 44
During April 2024, Lottie received a refund for damaged stationery, $15. This amount
was received into petty cash.
(a) Calculate the amount required to restore the petty cash imprest on 1 May 2024.[3m]
21+47+44-15=97
The petty cash book is one of the books of prime entry
(b) State one other book of prime entry [1m]
Cash book
(b) two advantages of using books of prime entry [2m]
1. Easier to look at one book instead of many ledger accounts
2. Serves as a ledger and a book of original entry
3. Book keeping can be divided within many people
[Total: 6m]
2. (a) Complete the corrected trial balance [10m]
Trial Balance at 30 September 2022
Account
Draft Trial Balance
Corrected trial balance
Debit
$
Debit
$
Bank overdraft
480
Carriage inwards
Discount allowed
Drawings
Credit
$
4 250
480
370
370
8 300
8300
Credit
$
4250
17 800
Equity
General expenses
17800
14350
14 350
Inventory 1 October 2021
Irrecoverable debts
7 200
7200
390
390
Loan to employee
100
100
Motor vehicle – cost
22 300
22300
Motor vehicle – provision for
depreciation
Premises
44 000
44000
Purchases
64 380
64380
Rent received
13 380
480
480
550
Returns inwards
Revenue
Trade payables
Trade receivables
13380
550
124 800
124800
8 420
8420
6710
6 710
169130
Total
16130
(b) Explain what is indicated if both totals of a trial balance are the same. [2m]
The debit and credit side are the same
If both totals of a trial balance are the same this indicates that there are no errors in the
books of account , however certain types of errors may still be present
(c) State one difference between an error of commission and an error of principle.
[2m]
Error of commission happens in the same account type / nature whereas error of
principle happens between different account types
(d) State one other type of error that does not affect the balancing of the trial balance.
[1m]
Compensating
[Total: 15m]
3
(a) State two benefits of maintaining a petty cash book. [2m]
1. Small expenses can be recorded systematically in the order of date_
2. Reduces the number of entries in the main cash book______
3. The workload is decreased for higher management
Sven has a petty cash balance of $150 as at 1 August 2022.
The following transactions took place during August 2022.
2022
Voucher
number
1201
Aug 5
Transaction
$
Paid employee’s travel expenses
14.00
12
1202
Purchased postage stamps
26.80
16
1203
Paid Fabrizi, a credit supplier
30.00
19
1204
Paid parcel post
45.00
24
1205
Paid taxi fare
9.60
Sep 1
To be
calculated
Restored float by cheque
(b) Prepare the petty cash book for the month ended 31 August 2022.
Balance the petty cash book on that date and bring the balance down on 1
September 2022. [9m]
Receipts
$
150
150.00
24.60
125.40
Date
2022
Aug 1
Details
Voucher
number
Total
$
Travel
$
Postage
$
Ledger
$
Bank
5 Travel expenses
1201
14.00
12 Postage stamps
1202
26.80
16 Creditor Fabrizi
1203
30.00
19 Parcel Post
1204
45.00
24 Taxi Fare
1205
9.60
9.60
125.4
23.6
31 Bal c/d
24.60
Total
150.00
Sep 1 Bal b/d
Bank
14.00
26.80
30.00
45.00
71.8
54.60
24.60
23.60
71.80
54.60
Petty cash book
(c) State whether the imprest amount restored would be shown on the debit side
or the credit side of the main cash book. [1m]
___Credit_________________________________________________________
_____
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
(d) State where in the statement of financial position the petty cash book balance
on 1 September 2022 will be shown. [1m]
It will be shown in the current assets.
(e) State two reasons why the balance in the petty cash book may be different to
the amount in the petty cash box. [2m]
1. Miscalculations / human error
2. The transaction has been made but not yet recorded in the petty cash book
3. 3. Frauds/ scams
[Total: 15m]
4. Rodrigo provided the following balances at 30 April 2023.
(a) Prepare the trial balance entering any difference in an appropriate account [9m]
Trial balance at 30 April 2023
Account
Bank loan
Balance
$
Debit
18 450
Credit
$
18450
183
183
Cash
3 964
3964
Drawings
19 730
19730
Equipment cost
37 860
37860
Equipment provision for depreciation
13 940
13940
Equity
28 500
28500
General expenses
21 010
21010
Inventory at 1 May 2022
23 940
23940
Carriage inwards
Inventory at 1 april 2022
5963
Suspense
69875
Purchases
69 875
Revenue
136 210
136210
Trade payables
8 352
8352
Trade receivables
17 197
17197
Wages
6 000
6000
Total
205452
205452
(b) State the type of error in each scenario. [2m]
Scenario
Type of error
Cash drawings of $175 had not been recorded.
Omission
Wages of $180 had been recorded in the cash book as
$80
Orignal entry ( Casting
error )
(c) Explain the effect on owner’s equity of not recording cash drawings of $175 [2m]
The owners equity will be overstated , the owners equity will be more than it
actually is.
_________________________________________________________________
(d) Explain the effect on owner’s equity of recording wages as $80 instead of $180 [2m]
The equity will increase.
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
[Total: 15m]
5
Keren maintains a three-column cash book.
On 1 March 2023 the balances were: bank $1 726 overdrawn, cash $350
The following transactions took place during March 2023.
March
2023
Transaction
1
2
4
11
20
26
27
29
Sold goods for cash, $490
Received notice from the bank that a cheque received from Arthur, $350,
had been dishonoured.
Paid SW Electric, $190, by standing order.
Received a credit transfer, $878, from Jules in full settlement of her
account balance, $950
Banked cash, $440
Paid Zelen, $686, by cheque in full settlement of an invoice after taking a
2% cash discount.
Paid wages by cash, $100
Paid bank charges, $8
Prepare the three-column cash book on page 13. Balance the cash book on
31 March 2023 and bring the balances down on 1 April 2023.[15m]
Cash Book
Date
Details
2024
Discount
Cash
Bank
Date
Allowed
$
$
2024
Details
$
1 March
Discount
Cash
Bank
Received
$
$
$
Bal b/d
350
March 1
Bal b/d
1 726
Sales
490
2
Debtors
350
878
4
SW electrical
190
2023
11
Jules
72
20
Cash
440
20
Bank
31
Bal c/d
1,644
26
Zelen
27
wages
29
Bank charges
31
Bal c/d
72
April 1st
2023
Bal B/D
840
300
2,960
440
14
100
8
300
14
April 1st
2023
Bal B/D
686
840
2960
1644.
[Total: 15m]
( ps I did not know how to do double ruling )