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WAEC BOOK KEEPING QUESTION & ANSWER RUNZ
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Book Keeping OBJ:
1-10: CDBBBCDDCB
11-20: CDBADCAAAA
21-30: ACDCDAADAA
31-40: CABBBDACDB
SECTION B
(6)
(1a)
A trading account can be any investment account containing securities, cash or other holdings.
(1b)
(i) Purchase
(ii) Sales
(iii) carriage inward
(iv) Carriage outward
(v) Expenses
(vi) Gross profit
(vii) Net profit
(viii) Opening stock
(2a)
Discount is an allowance or concession in price. Discount is given so that the buyer is induced (lured) to place an order and later to make payment in time.
(2bi)
(i)Lower Business Costs. A significant trade discount advantage is the small business’ ability to lower operational business costs.
(ii)Increase Purchasing Power.
(iii)Improve Goodwill.
(iv)Higher Consumer Sales.
(2bii)
(i)Attracting New and Repeat Customers.
(ii)Increase Sales Across the Board.
(iii)Free Up Room in Your Store.
(iv)Meet Sales Goals.
(4a)
Depreciation refers to two aspects of the same concept: The decrease in value of assets The allocation of the cost of assets to periods in which the assets are used. Depreciation is a method of reallocating the cost of a tangible asset over its useful life span of it being in motion.
(4b)
(i) To Calculate the True Profits
(ii) To show true Financial Position
(4ci)
Fixed Instalment: fixed installment method of depreciation the amount of depreciation each year is fixed and equal. At the end of each year, a fixed amount is removed from the book value of the asset concerned and charged to profit and loss account (or income statement ).
(4cii)
Diminishing Balance: Diminishing balance depreciation method is one of the three
depreciation methods that mention in This kind of depreciation method is said to be highly charged at the first period, and then subsequently reduced.
This is because the charging rate is applying to the Net Book Value of Assets and the Net Book Value of Assets is reduce from time to time after charging depreciation.
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(8a)
Journal entry
Sales account
Dr 49,000
Suspense of account being error of principle and now corrected
Cr 49,000
Lammidu’s Account
Dr 76,200
Suspense account being error of parties omission now corrected
Cr 76,200
Discount allowed
Dr 57,000
Discount received
Dr 57,000
Suspense account being error of principle of complete
Cr 114,000
Return inward account
Dr 30,000
Suspense account under cast in return inward now corrected
Cr 30,000
(8b)
difference in trial balance recorded
Dr 269,200
Total =269,200
Credit side
Sales 49,000
Lammidu’s AK 76,200
Discount allowed 57,000
Discount received 57,000
Return inward 30,000
Total =269,200
(7)
(7a)
tabulate
Year
2013
2014
2015
2016
2017
Value of machine
470,900
400,300
330,300
270,000
220,000
Dep.
20,000
20,000
20,000
20,000
20,000
NBV
450,000
380,300
310,900
250,000
200,000
Total =1,592,100
(a) straight line method
Year 1 2013 = 470,900-20,000 = 450,900
Year 2 2014= 400,300-20,000=310,900
(7b)
Reducing balance method with 28% depreciation rate
Year=2013
1592.100 – 470900=1.92100
28/100* 1,92100/1121200/1
=313,936
Year=2014
= 1592100 – 400,300
= 1191800
28/100 *1191800/1
=353,136
(8)
(5a)
Provision for doubtful debt account
Debit side
2015
Dec 31 balance c/d 400,000
2016
Dec 31 balance c/d 600,000
Total =1,000,000
Credit side
2015
Dec 31 profit & loss 380,000
2016
Dec 31 profit & loss 570,000
Total=1,000,000
(9)
Categories: WAEC