ACCOUNTING TECHNICIANS SCHEME, WEST AFRICA

BASIC ACCOUNTING PROCESSES & SYSTEMS

PAPER FOR MARCH 2021 DIET
QUESTIONS AND MARKING SCHEME

SECTION A: PART I MULTIPLE-CHOICE QUESTIONS (30 Marks)

ATTEMPT ALL QUESTIONS

Write ONLY the alphabet (A, B, C, D or E) that corresponds to the
correct option in each of the following questions/statements.

1. When cash taken from the till is banked, the transaction is recorded
as a
A. Bank entry
B. Till entry
C. Cash entry
D. Debit entry
E. Contra entry

2. The processes involved in book-keeping are as follows, EXCEPT

A. Classification of business transactions using source documents
B. Recording of transactions in appropriate subsidiary books
C. Extraction of the Trial Balance
D. Extracting future cash flow
E. Posting of entries from subsidiary books to the ledger

3. The following are non-current assets, EXCEPT

A. Land
B. Goodwill
C. Building
D. Receivable
E Machinery

4. Which of the following is NOT a characteristic of business?

A. It is a social service to the public
B. It exits to make profits
C. It supplies goods that it either makes or buys from other
parties
D Its reward for accepting risk is profit
E. The profit earned by it belongs to its owners

Page 1 of 34
5. Which of the following is NOT a content of the partnership
agreement that can affect partnership account?
A. Capital contribution
B. Division of profits or losses
C. Interest on capital
D Partners’ drawings
E. Partners’ domestic expenses

6. Which of the following is NOT a key characteristic of Public Sector

Entities?
A. There is no equity ownership
B. The entities’ right, powers and responsibility are derived from
the law setting them up
C. They have multiple objectives
D. Public accountability by the operators is very important
E. It involves profit-sharing

7. Which of the following is NOT one of the elements of financial

statements recognised by the IASB’s conceptual framework?
A. Receipt and Payment Account
B Asset
C. Liabilities
D. Equity
E. Income and Expenditure

8. Which of the following is NOT recognised as Generally Accepted

Accounting Principles?
A Concepts
B Principles
C. Conventions
D. Laws, rules and regulations
E Theories

9. The meaning of entity concept to a partnership business is that the

A. Partners can issue ordinary shares
B. Liability of all the partners are limited
C. Partner’s drawing reduces capital contribution
D. Current Account is not necessary for the partners
E. Partners cannot own private assets

10. Which of the following is NOT a main source document that is used
for recording in the books of original entry?
A. Quotations
B. Pro-forma invoices
C. Credit notes
D Sales Ledger

Page 2 of 34
 E. Payment Vouchers

11. Which of the following is TRUE of the General Journal?

A. It has a brief explanation or narration of the transaction
B. It has only Debit column
C. It uses only Credit column
D It does not have debit and credit column
E. It is used to record only sales and purchases transactions

Use the following information to answer questions 12 and 13

The following transactions took place in the books of Adegboyega

Enterprises in January, 2020
(i) January 5, 2020 Cash sales of N500,000
(ii) January 10, 2020 Purchased N300,000 goods in cash

12. The correct double entry for item (i) is?

DR CR
A. Sales Account Cash Account
B. Cash Account Sales Account
C. Cash Account Bank Account
D. Bank Account Cash Account
E. Sales on credit Cash Account
13. The correct double entry for item (ii) is
DR CR
A. Bank Account Goods account
B. Goods returns inwards Cash Account
C. Cash Account Purchases Account
D. Purchases Account Cash Account
E Cash Account Purchases on credit
14. ONE of the main uses of Trial Balance is to?
A. Post items from sales day book into the sales ledger
B. Check postings from purchases day book into the purchases
ledger
C. Facilitate preparation of the final accounts
D. Correct errors of postings
E. Standardise accounting records

Page 3 of 34
15. Temitope Enterprises provision or allowance for depreciation in
2019 accounting year is N50,000. Which of the following is the
correct double entry for this transaction?
DR CR
A. Depreciation expense account Allowance for depreciation
B. Allowance for depreciation Depreciation expense
account
C. Non-current asset Depreciation expense
account
D. Depreciation expense account Statement of profit or loss
account
E. Depreciation expense account Cash book

16. Which of the following is NOT a revenue expenditure?

A. Cost incurred in acquiring trading inventories for sale
B. Discount allowed on Credit sales
C. Cost of Repairing Plant and Equipment
D. Staff Salaries and emoluments
E. Purchase of new equipment for use as non-current asset

17. Which of the following is NOT a debit entry in Trade Receivables

Ledger Control Accounts?
A. Dishonoured bills and cheques from customers
B. Cash paid to customers from the cash book
C. Debit notes issued
D. Discount allowed as recorded in the Cash book
E. Credit Sales from sales day book

18. Which of the following is NOT added to Basic Salary to arrive at the
Gross pay?
A. Responsibility allowance
B. Transport allowance
C Tax due
D. Overtime allowance
E. Medical allowance

Page 4 of 34
Use the following information to answer questions 19 and 20

The following information was provided by Camara enterprises:

Standard Time or Allowed Time = 250 hours
Wages rate per hour = Le15
Actual time taken = 220 hours
The enterprise uses Hasley Premium Plan.

19 The Bonus amount is

A. Le 210
B. Le 220
C. Le 225
D. Le 235
E. Le 240

20. Total earnings is

A. Le 3,425
B. Le 3,455
C. Le 3,515
D. Le 3,525
E. Le 3,555

21. Which of the following is NOT an advantage of Time Based system of

remuneration?
A. It facilitates cost control
B. It provides incentive for longer period of work
C. Wages negotiations (changes) can be easily affected
D. It has stood the test of time
E. It does not encourage innovation

22. Which of the following is NOT an objective of control over cash?

A. Temptation to embezzle idle cash by staff is avoided
B. It enable the business to have more idle cash in the office at all
times
C. It prevents losses of cash through fraud or theft
D. There will be accurate accounting for cash transactions
E. Management will maintain adequate amount of cash at all
times
Use the following to answer questions 23 and 24

Gamil Nkuruma Ventures has the following transactions in the month of

January, 2020
(i) Discount allowed on Sales to customers amount to
GMD20,000.
(ii) Discount received on Purchases from Supplies is GMD30,000.

Page 5 of 34
23. The accounting treatment of item (i) in the books of Gamil Nkuruma
Ventures is
DR CR
A. Cash book Discount allowed account
B. Discount allowed account Cash book
C. Income statement Discount allowed account
D. Discount allowed account Income statement
E. Cash book Income statement

24. The accounting treatment of item (ii) in the books of Gamil

Nkuruma Ventures is
DR CR
A. Income statement Discount received account
B. Discount received account Income statement
C. Cash book Discount received account
D. Discount received account Cash book
E. Cash book Income statement

25. Which of the following is NOT a component of the published financial

statements?

A Statement of Profit or loss and other comprehensive income

B. Cash book and subsidiary ledgers
C. Statement of financial position
D. Statement of changes in equity
E Statement of cash flows

Use the following information to answer questions 26 and 27

Weah Enterprises presented the following information from its financial

records for the year ended 31 December, 2019
L$
Sales 56,000
Purchases 40,000
Carriage outwards 1,600
Returns inwards 900
Carriage inwards 1,300
Returns Outward 1,490

26. The Cost of Sales is

A. L$ 38,700
B. L$ 39,810
C. L$ 40,190
D. L$ 41,300
E. L$ 41,400

Page 6 of 34
27. The Gross Profit is
A. L$ 15,290
B. L$ 15,300
C. L$ 16,190
D. L$ 17,280
E. L$ 18,111

28. Which of the following is NOT a feature of spread sheet package?

A. Row
B. Column
C. Cell
D. Title Bar
E. Sequential Formula

29. Which of the following is NOT an Accounting package?

A. Sage
B. Quick Books
C. Microsoft Excel
D. Tally
E. Oracle

30. The International Accounting Standard (IAS) on Property, Plant and

Equipment (PPE) is ………
A. 1
B. 2
C. 5
D. 8
E. 16

Page 7 of 34
SECTION A: PART II SHORT-ANSWER QUESTIONS (20 Marks)

ATTEMPT ALL QUESTIONS

Write the correct answer that best completes each of the following
questions/statements:

1. Characteristics of useful financial information that has to do with

relevance and faithful representation is known as……………………

2. The full meaning of IFRIC is……………… and IASB is………………

3. The relationship that exists between two or more persons carrying

on business with a view to making profit is called……………………

4. The two main documents that are fundamental to the creation of a

limited liability company are ……………….. and ……………………..

5. IASB’s conceptual framework prescribes that the financial

statements required of entities are…………. financial statements.

6. The concept which assumed that a business entity will continue in

operation for the foreseeable future is regarded as ………………..

7. The source document used to record in the sales day book is ..

8. The books in which transactions are first recorded before being

posted to the ledger is called ………………….

9. Ibukunoluwa introduced a capital of N200,000 (using cheque) to

start a Face Mask business on February 2, 2020. The double entry for
this transaction is ………………… and ……………

10. An error within the same class of account but affecting different
persons or items is known as an error of ………………………

11. The cost of acquiring a non-current asset for use in an entity is

known as …………………..

12. Which side of the Trade Payables Ledger Control Account can we post
Discount received and Purchases?

13. Cheques deposited in the business bank account and not yet recorded
in the bank statement as at the time of preparing Bank Reconciliation
statement is called ………………….

14. The formula for calculating bonus in Rowan plan scheme is ………….

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15. The term given to an allowance in form of a percentage reduction in
the full invoice price made to a customer is ……………………

16. A written authorisation used in approving a transaction for

payment is called ……………………..

17. An amount allowed to a customer so that he can pay promptly is

called …….

18. Application software that record and process accounting

transactions within functional modules are known as…………………

Use the following information to answer questions 19 and 20

The following transactions/information were extracted from the financial
statements of the Kofi Enterprises:

GH¢
Insurance premium 30,000
Building 800,000
Equipment 200,000
Motor Vehicle maintenance 100,000
Discount received 20,000
Discount Allowed 15,000
Bank Loan 500,000
Trade Creditors 50,000

19. The items that will be posted into Income Statement are:
i ………………….. ii …………………… iii ………………… iv ………

20. The items that will be posted into Statement of Financial Position
are:i …………….. ii ……………… iii ……………… iv ………………

Page 9 of 34
SECTION B: ATTEMPT ANY FOUR QUESTIONS IN THIS SECTION (50 Marks)

QUESTION 1

a. Nyumah is a sole trader involved in sewing and selling COVID 19 face

mask. Nyumah introduced the capital of L$200,000 into the business on
the March 2, 2020 in form of cash. He bought a laptop computer worth
L$50,000 on March 4, 2020 for the office but gave the laptop to her
daughter to use for her University Degree programme.

Required
You are required to show the double entries as the Accounting technician.
(4 Marks)

b. The following were extracted from the books of Cheapoo Enterprise, that
is into electronic business in Moronvia for the month of November, 2019:
L$’000
Sales Ledger balance – 1 November, 2019 9,404
Purchases ledger balances – 1 November, 2019 5,514
Sales journal balances – 30 November, 2019 74,874
Purchases journal balances – 30 November, 2019 81,600
Returns inwards 1,820
Returns outwards 1,498
Receipts from Customers – Cash 77,058
Discount allowed 2,690
Payment to Suppliers 70,830
Discount received 1,492
Irrecoverable debts written off 230
Sales ledger set off 418
Purchases ledger set off 220
On 30 November, 2019, it was discovered that a supplier was paid
twice in error. The amount was refunded on that date.
Required
Prepare the Sales and Purchases ledger balances as at 1 December,
2020.
(8½ Marks)
(Total 12½ Marks)

Page 10 of 34
QUESTION 2

a. What is Double entry principle? (2½ Marks)

b. i. Explain FIVE main importance of the Ledger Accounts.

(5 Marks)
ii. State and explain FOUR groups of ledger. (5 Marks)
(Total 12½ Marks)

QUESTION 3

a. Explain the term “liabilities”. (2½ Marks)

b. Akwasi is a graduate of Accounting that has struggled to find a paid

employment but couldn’t. In December, 2019, he heard about COVID-19
and took interest in producing hand sanitizer and face mask. He sold
the ideas to a business magnate that funded the project on January 1,
2020, he started the business, as Akwasi Ventures, with the production
of hand sanitizer and face mask. The product has a trade name of
AKWA19 for a worldwide market. He was successful in the first three
months ending 31 March, 2020 but didn’t know to what extent?
For him to know the extent of the success and profit, he presented
the following Trial balance as at 31 March, 2020

GH¢’000 GH¢’000
Sales 5,600
Purchases 4,000
Carriage outwards 160
Electricity 80
Salaries & Wages 620
Insurance 30
Buildings 10,000
Fixtures 400
Receivables 700
Returns inwards 90
Payables 410
Bank 650
Drawings 480
Carriage inwards 130
Motor Vehicles 1,600
Capital 12,881
Returns outwards 149
Rent of Office 100 -
equipment
19,040 19,040

Page 11 of 34
 Required
Prepare Statement of Profit or Loss for the period ended 30 April, 2020,
and a Statement of Financial position as at 30 April, 2020. (10 Marks)
(Total 12½ Marks)

QUESTION 4

a. In accordance with International Accounting Standard No.1 on

Preparation of Financial Statements, state FIVE main components of
financial statements. (2½ Marks)

b. Sandolo Blah, a Liberian entrepreneur, presented the following

information extracted from the financial records of his business
i. Goods sold for GMD141,000 and profit on sale is GMD27,000.
ii. Inventory bought for GMD150,000 and sold for GMD240,000.
iii. Inventory bought for GMD90,000 with loss on sale of GMD18,000.

You are required to use accounting equations to calculate

i. Expenses for (i) above
ii. Profit for (ii) above
iii. Revenue for (iii) above
(3 Marks)

c. Cheapoo Conteh Enterprise is a local manufacturer of dress wear to be

included in Personal Protective Equipment (PPE). The following
balances are extracted from the financial records of the organisation for
the year ended 31 December, 2019.
GMD’000
Raw materials inventories as at 1 January, 2019 40,000
Work-in-progress as at 1 January, 2019 29,000
Purchase of raw materials 120,000
Manufacturing wages 80,000
Returns outwards 17,500
Carriage inwards 22,000
Office salaries 33,500
Factory Machine Depreciation 28,000
Factory Insurance premium 14,000
Factory expenses 33,000
Royalties paid 36,000
Raw material inventories as at 31 December, 24,000
2019
Work-in-progress as at 31 December, 2019 25,000

Page 12 of 34
You are required to
Prepare the Manufacturing Account for the year ended 31 December, 2019
in order to ascertain the Production cost that will be transferred to the
Statement of Profit or Loss. (7 Marks)
(Total 12½ Marks)

QUESTION 5

a. What is Microsoft Excel? Explain FIVE of the main features of Microsoft

Excel Spread sheet. (6 Marks)

b. Explain the term “Data Entry” for accounting transactions (with

specific examples). (5 Marks)

c. List THREE data used for input into non-current assets subsystem under
accounting packages. (1½ Marks)
(Total 12½ Marks)

QUESTION 6

Adegboyega Kofoshi is a graduate with a Degree in Electrical and

Electronic Engineering. During his Youth Service, he had a savings of
N990,000 from his service year allowance, from his parents and the
company where he served. After the Youth service, he started a retail
business, Adegboyega Kofoshi Enterprises, selling household electrical
equipment. He transferred his car worth N1,440,000 for the use of the
business. The car was a gift from his parents. He borrowed N198,000 from
his friend. All these were used for the business. During the month of
December, 2019, he had the following transactions:

N
December 3 Purchased electrical equipment from Chukwu Ltd on 540,000
credit
Dec 3 The equipment carriage expenses to warehouse by 49,368
cash
“ 6 Sold goods on credit to Johnson & Co 570,000
“ 8 Sold good for cash 78,840
“ 11 Paid general expenses by cash 48,834
“ 15 Purchased electrical items on credit from Chukwu Ltd 180,000
“ 17 Adelaide Ventures repair the motor car on credit 32,556
“ 20 Paid cash to Chukwu on account 502,500
“ 22 Johnson & Co paid cash 375,000
“ 25 Paid cash for salaries and wages 233,874

Page 13 of 34
 “ 25 Paid cash for Rent & Rates 18,000
“ 27 Sold electrical wire to Ajibandele on credit 204,000

You are required to

a. Post the transactions into the ledgers.
b. Extract a Trial Balance as at 31 December, 2019.
(Total 12½ Marks)

Page 14 of 34
SOLUTION TO QUESTIONS

SECTION A: PART 1 MULTIPLE-CHOICE

1. E
2. D
3. D
4. A
5. E
6. E
7. A
8. E
9. C
10. D
11. A
12. B
13. D
14. C
15. A
16. E
17. D
18. C
19. C
20. D
21. E
22. B
23. C
24. B
25. B
26. B
27. A
28. E
29. C
30. E
(30 ticks @ 1 mark each = 30 marks)

Page 15 of 34
Working Notes on MCQ

19. Bonus 50% (250hrs – 220hrs = 30hrs)x Le 15

= 50% x 30hrs x Le 15
= Le 225

20. Total Earing = Le 15 x 220hrs + bonus (w19)

= Le 3300 + Le 225
= Le 3525

26. L$

Purchases
40,000

Carriage Inwards 1,300

Returns outwards
(1,490)

27. Cost of sales L$39,810

L$

Sales
56,000
Returns Inwards

(900)

55,100

Less costs of salary (w26)

(39,810)

Gross profit L$15,290

Page 16 of 34
SECTION A: PART II SHORT-ANSWER QUESTIONS (SAQ)

1. Qualitative Characteristics
2. IFRIC – International Financial Reporting Interpretation Committee
IASB – International Accounting Standard Board
3. Partnership business
4. Memorandum of Association/Articles of Association
5. General purpose
6. Going concern
7. Sales Invoice/Bill
8. Subsidiary books/Books of prime entry/Books of origin entry
9. Dr Bank and CR Capital
10. Commission
11. Capital Expenditure
12. Discount Received – Debit side
Purchase – Credit side
13. Uncredited cheques/lodgements
𝑇𝑖𝑚𝑒 𝑆𝑎𝑣𝑒𝑑
14. Bonus 𝑇𝑖𝑚𝑒 𝐴𝑙𝑙𝑜𝑡𝑡𝑒𝑑 x Time Taken x Time Rate

15. Trade Discount

16. Approved payment voucher
17. Cash Discount
18. Accounting Softwares/Packages
19.
Insurance Premium GH¢ 30,000
Motor vehicle maintenance GH¢ 100,000
Discount received GH¢ 20,000
Discount Allowed GH¢ 15,000

20.
Building GH¢ 800,000
Equipment GH¢ 200,000
Bank loan GH¢ 500,000
Trade creditors/payables GH¢ 50,000

(20 ticks @ 1 mark each = 20 Marks)

Page 17 of 34
SECTION B:

QUESTION 1

a. IN THE BOOKS OF NYUMAH

DOUBLE ENTRIES /JOURNAL ENTRIES

DR DR
L$ L$
Cash book/Bank 200,000
Capital 200,000
Office Equipment 50,000
Cash book 50,000

Drawings 50,000
Office 50,000
Equipments
(8 ticks @ ½ mark each = 4 Marks)

OR Through Ledger Approach

Cash Book / Bank A/C

L$ L$

Capital 200,000 Equipment 50,000

Bal c/f 150,000

L$200,000 L$200,000

Bal b/f 150,000

Capital A/C

L$

Cash book 200,000

Page 18 of 34
 Office Equipment

L$

Cash Book 50,000 Drawings 50,000

Drawings A/C

L$

Office Euipments 50,000

(8 ticks @ ½ mark each = 4 Marks)

b. CHEAPOO ENTERPRISES

SALES LEDGER CONTROL ACCOUNT

2019 L$’000 2019 L$’000
1 Nov Bal b/f 9,404 30 Nov Cash 77,058
30 Sales 74,874 30 Returns inwards 1,820
30 Set off 220 30 Discount Allowed 2,690
30 Bad debt written off 230
30 Set off 418
30 Balance c/d 2,282
84,498 84,498
1 Dec Balance b/d 2,282
(Any 8 sticks @ ½ marks = 4 Marks)

PURCHASES LEDGER CONTROL ACCOUNT

2019 L$’000 2019 L$’000

30 Nov Returns outwards 1,498 1 Nov Bal b/f 5,514
30 Cash 70,830 30 Purchases 81,600
30 Discount received 1,492 30 Cash refund 314
30 Set Off 418 30 Set off 220
30 Balance c/d 13,410
87,648 87,648
30 Balance b/d 13,410

(9 ticks @ ½ marks = 4½ Marks)

(Total 12 ½ Marks)

Page 19 of 34
QUESTION 2

a. Double entry principle states that for every debit entry, there must be
a corresponding credit entry and vice-versa. If the principle is
properly followed, the total of the debit entries in the accounts must be
equal to the total of the credit entries.

There are three pairs of concepts that aid the understanding of the
double entry principles and they are:

1. Debit incoming items and Credit Outgoing items

2. Debit the Receiver and Credit the Giver.
3. Debit Expenses/Losses and Credit Profit/gains

In general, the above principles are the underlying basis for debiting
assets and expenses as well as crediting liabilities and revenue.
(2½ Marks)

b. (i) FIVE (5) Importance of ledgers

 They serve as the means of keeping permanent records of assets, liabilities,
income, expenses and Owner’s equity.
 They provide relevant information that is required to prepare the statement of
profit or loss and the statement of financial position.
 They give the origin of every transaction and the parties involved.
 They show the details of movement in each account. For instance, a bank
account will show what amount had been deposited or how much had been
withdrawn and for what purpose.
 The Trial Balance is extracted from the ledger accounts at the end of the
accounting period.
(Any 5 points @ 1 mark each = 5 Marks)

(ii) FIVE (5) Groups of Ledgers

 Sales Ledger or Trade Receivable Ledger: This contains all the

personal accounts of customers otherwise referred to as trade
receivables.
 Purchases Ledger or Payables Ledger: It contains the personal
accounts of suppliers of goods and services, otherwise referred to as
trade payables.
 Private/Cash Ledger: Private ledger contain details of capital
accounts, drawings account, loan account and investment account.
Usually only the senior managers have access to these accounts in order
to prevent details of the items contained therein from being publicized.
The Cash ledger contains all cash transactions.
 General Ledger: This is also referred to as the nominal ledger. It
contains the remaining accounts such as:

Page 20 of 34
  Nominal accounts: relating to expenses, wages, rent, sales, purchases,
bad debt accounts; and
 Real accounts: relating to assets such as land and buildings, motor
vehicles, inventories, plant and machinery.

½ marks for mentioning

½ mark for explanation including Nominal and Real accounts
(5 Marks)
1
(Total 12 /2 Marks)

QUESTION 3

a. Liabilities
Liability can be defined as present obligations of an entity arising
from past events and the settlement of which is expected to result in
an outflow of resources that embody economic benefits.
A liability is an obligation that already exists. An obligation may
arise also from normal business dealings usually from past
transactions or events. Trade payables for example, arise out of past
purchase transactions so also an obligation to pay a bank loan must
have arisen out of past borrowings. There are two major categories
of liabilities which are: current liabilities and non-current liabilities.

Current Liabilities: These are amounts owed currently by business

to be paid within twelve (12) months. Such as trade payable, Bank
overdraft etc.

Non-current liabilities: these are current obligation that will take

more than one year before repayments is due, such as long term
loans etc.
(2½ Marks)

Page 21 of 34
b.

AKWASI VENTURE

Statement of Profit or Loss for the year ended 31 March, 2020

GH¢’000 GH¢’000
Sales 5,600
Returns inwards (90)
Net Sales 5,510
Less Cost of Sales:
Purchases 4,000
Carriage inwards 130
4,130
Returns outwards (149) (3,981)
Gross Profit 1,529
Expenses
Carriage outwards 160
Electricity 80
Salaries and Wages 620
Insurance premium 30
Rent of Office equipment 100 (990)

Profit for the year 539

Statement of Financial Position as at 31 March, 2020

GH¢’000 GH¢’000
Assets
Non Current Assets
Buildings 10,000
Fixtures 400
Motor Vehicles 1,600 12,000
Current Assets
Receivables 700
Bank 650 1,350
Total Asset 13,350

Equity and Liabilities

Capital 12,881
Net Profit 539
Drawings (480)

Page 22 of 34
 12,940
Current Liabilities
Payables 410
Total Assets and Liabilities 13,350

( 40 ticks @ 1/4 marks each =10 Marks)

(Total 12 ½ Marks)

QUESTION 4

a. The Five (5) main Components of Financial Statements in accordance

with IAS 1

(i) Statement of Financial Position as at the end of the period

(ii) Statement of Profit or Loss and other comprehensive income for the
period;
(iii) A Statement of changes in equity for the period.
(iv) A Statement of Cash flows for the period
(v) Notes, comprising a summary of significant accounting policies and
other explanatory information and;
(vi) A statement of financial position as at the beginning of the earliest
comparative period when an entity applies an accounting policy
retrospectively or make a retrospective restatement of items in its
financial statement. (Any 5 ticks @ ½ mark = 2 ½ Marks)

b. Accounting equation

P = Profit; R = Revenue; E = Expenses

(i) Calculation of Expenses (E)

E = R–P

= Le 141,000 – Le 27,000

= Le 114,000

(ii) Calculation of Profit (P)

P = R–E
= Le 240,000 - Le 150,000
= Le 90,000

(iii) Calculation of Revenue (R)

R = P + E

Page 23 of 34
 = (Le 18,000) + Le 90,000
= Le 72,000

(1 Mark for each = 3 Marks)

c. Cheapoo Conteh Enterprise

Manufacturing Account for the year ended 31 December, 2019

GMD (000) GMD (000)

Opening inventory:

Raw materials
40,000

Purchases - materials 120,000

Carriage inwards 22,000

142,000

Returns outwards materials (17,500)

124,500

Cost of materials available

164,500

Manufacturing wages
80,000

Royalties
36,000

Prime cost
256,500

Factory Overheads:

Depreciation - Machine 28000

Factory Insurance 14000

Page 24 of 34
 Factory expenses 33,000
75,000

Changes in wip

Opening inventory (wip) 29000

Closing inventory (wip) (25000)

4,000

Cost of production GMD

335,500

(28 ticks @ 1/4 mark each = 7 Marks)

(Total 12½ Marks)

QUESTION 5

a. Microsoft Excel is a powerful tool for manipulating of rows and column

to process, record, post and analyze data. They are widely used in the
field of accounting and finance to calculate depreciation of various type,
project evaluation and mathematics of finance. (1 Mark)

The main features of Microsoft Excel includes:

(i) Rows: These are referenced by numbers starting from 1. Initially, there
are 65,536 rows. For Microsoft 2010, row ranges from 1 to 1,048,576.

(iii) Columns: They are referenced by alphabets starting from A. Initially

there are 256 colums. For Microsoft 2010, column is now from A to
XFD and total of 16384 columns.

(iv) Cell: A cell is the intersection of row and column. The number depend
on the Microsoft Excel version in use.

(iv) Worksheet: This contains cells which are made of rows and columns
as shown above depending on the version of Microsoft Excel in use. It
has the chance of opening pages which are known as sheet1, sheet 2,
sheet 3…………

(v) Workbook: The workbook consists of worksheets. It is also called excel

file. The file contains a set of pages called work sheets.

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(vi) Title Bar: This refers to the name of current workbook.

(vii) Menu Bar: This consist of varieties of menu such as file, edit, view,
save etc
(Any 5 explanations @ 1 mark each = 5 Marks)

b. Data Entry for Accounting transactions (with specific examples)

A computerized accounting system permits the entity to enter data

electronically in variety of ways, which make processing of transactions
more convenient. Data entry is a process whereby data that are collected
from various sources are entered into the computer system through
input devices like the key board. There are various forms of electronic
source documents that can be used to process data. (2 ½ Marks)

These include:
(i) Electronic receipt issued to customers to post into electronic cash
book.

(ii) Electronic invoices issued to customers who bought an entity’s

goods on credit used to post into the Sales Day Book.

(iii) Electronic invoices received from suppliers that supplied goods on

credit used to post into the Purchases Day Book.

(v) Electronic invoices and receipts received from suppliers for posting
into return outwards and suppliers account; and

(vi) Electronic credit advise (note) used to post into return inwards and
customers’ accounts.
(Any 5 specific example @ ½ each marks = 2½ Marks)

c. THREE (3) types of data used for input into non-current assets
subsystem under accounting packages are;

(i) Capitalization policy

(ii) Depreciation policy
(iii) Purchase invoices
(iv) Cash payments
(v) Adjustment Journal
(Any 3 points @ ½ marks = 1 ½ Marks)
(Total 12 ½ Marks)

Page 26 of 34
QUESTION
6
ADEGBOYEGA KOFOSHI
a) ENTERPRISES

Cash a/c
N N

1-Dec-19 Bal b/f 1,188,000 3-Dec-19 Carriage inwards 49,368

11-Dec-
8-Dec-19 Sales 78,840 19 General expenses 48,834
20-Dec-
22-Dec-19 Tade receivables- Johnson & Co 375,000 19 Trade payables- Chukwu Ltd 502,500
25-Dec-
19 Salaries and wages 233,874
25-Dec-
19 Rent amd rates 18,000
31-Dec-
19 Bal c/d 789,264

1,641,840 1,641,840

1-Jan-20 Bal b/d 789,264

Capital a/c
N N

31-Dec-19 Bal c/d 2,430,000 1-Dec-19 Bal b/f 2,430,000

1-Jan-20 Bal b/d 2,430,000

Page 27 of 34
 Motor vehicle a/c
N N
31-Dec-
1-Dec-19 Bal b/f 1,440,000 19 Bal c/d 1,440,000

1-Jan-20 Bal b/d 1,440,000

Loan a/c
N N

31-Dec-19 Bal c/d 198,000 1-Dec-19 Bal b/f 198,000

1-Jan-20 Bal b/d 198,000

Purchases
a/c
N N
31-Dec-
3-Dec-19 Trade payables- Chukwu Ltd 540,000 19 Bal c/d 720,000

15-Dec-19 Trade payables- Chukwu Ltd 180,000

720,000 720,000
1-Jan-20 Bal b/d 720,000

Trade payables- Chukwu Ltd a/c

N N

20-Dec-19 Cash 502,500 3-Dec-19 Purchases 540,000

Page 28 of 34
 15-Dec-
31-Dec-19 Bal c/d 217,500 19 Purchases 180,000
720,000 720,000
1-Jan-20 Bal b/d 217,500

Carriage inwards a/c

N N
31-Dec-
3-Dec-19 Cash 49,368 19 Bal c/d 49,368

1-Jan-20 Bal b/d 49,368

Sales a/c
N N
Tade receivables- Johnson &
31-Dec-19 Bal c/d 852,840 6-Dec-19 Co 570,000

8-Dec-19 Cash 78,840

27-Dec-
19 Tade receivables- Ajibandele 204,000
852,840 852,840

1-Jan-20 Bal b/d 852,840

Tade receivables- Johnson & Co a/c

N N
22-Dec-
6-Dec-19 Sales 570,000 19 Cash 375,000
31-Dec-
19 Bal c/d 195,000

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 570,000 570,000

1-Jan-20 Bal b/d 195,000

General expenses a/c

N N
31-Dec-
11-Dec-19 Cash 48,834 19 Bal c/d 48,834

1-Jan-20 Bal b/d 48,834

Motor vehicle repairs a/c

N N
31-Dec-
17-Dec-19 Sundry payables- Adelaide Ventures 32,556 19 Bal c/d 32,556

1-Jan-20 Bal b/d 32,556

Sundry payables- Adelaide Ventures

a/c
N N
17-Dec-
31-Dec-19 Bal c/d 32,556 19 Motor vehicle repairs 32,556

1-Jan-20 Bal b/d 32,556

Page 30 of 34
 Salaries and wages a/c
N N
31-Dec-
25-Dec-19 Cash 233,874 19 Bal c/d 233,874

1-Jan-20 Bal b/d 233,874

Rent and rates a/c

N N
31-Dec-
25-Dec-19 Cash 18,000 19 Bal c/d 18,000

1-Jan-20 Bal b/d 18,000

Tade receivables- Ajibandele a/c

N N
31-Dec-
27-Dec-19 Sales 204,000 19 Bal c/d 204,000

1-Jan-20 Bal b/d 204,000

(Any 34 @ ¼ mark =8 ½
Marks)

Page 31 of 34
b. ADEGBOYEGA KOFOSHI ENTERPRISES
TRIAL BALANCE AS AT DECEMBER 31, 2019
DETAILS DR CR
N N

Cash 789,264

Capital 2,430,000

Motor Vehicles 1,440,000

Loan 198,000

Purchases 720,000

Trade payables- Chukwu Ltd 217,500

Carriage inwards 49,368

Sales 852,840

Tade receivables- Johnson & Co 195,000

General expenses 48,834

Sundry payables- Adelaide
Ventures 32,556

Motor vehicle repairs 32,556

Salaries and wages 233,874

Rent and rates 18,000

Tade receivables- Ajibandele 204,000

Page 32 of 34
3,730,896 3,730,896

16 ticks @ ¼ mark each = 4 Marks

(Total 12 ½ Marks)

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