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Micky

The document provides accounting information including a debtors control account, profit and loss account, cash book, and statement of financial position for a business. It shows the business had total assets of TZS 40,354 as of December 31, 2021 including a van, cash, debtors, stock, and prepaid insurance. The business had total liabilities of TZS 40,354 including trade creditors and capital. Various workings are provided to calculate figures such as purchases, sales, rent expenses, and insurance expenses.

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ombenimichael20
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25 views4 pages

Micky

The document provides accounting information including a debtors control account, profit and loss account, cash book, and statement of financial position for a business. It shows the business had total assets of TZS 40,354 as of December 31, 2021 including a van, cash, debtors, stock, and prepaid insurance. The business had total liabilities of TZS 40,354 including trade creditors and capital. Various workings are provided to calculate figures such as purchases, sales, rent expenses, and insurance expenses.

Uploaded by

ombenimichael20
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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ANSWER 2

(i). Adjusted Debtors Control Account


TZS. ‘000’ TZS. ‘000’
Balance b/d 27,000 Balance b/d 650
Interest (65 - 59) 6 Discount allowed 330
Sales returns 15 Contra 280
Balance c/d Balance c/d 2,576
27,021 27,021
Balance b/d 27,021

(ii) Schedule of Debtors Accounts Balances


TZS. ‘000’ TZS. ‘000’
Balance as per list of debtors 25,396
Add:
Sales - cash and credit 2,200
27,596

Deduct
Discount allowed 120
Interest 30
Contra 550
Bills received 1,120
Sales return 15 (1,835)
Net balance as per adjusted control account ………………………………………… 25,761

(iii). Why debtors control accounts should be prepared


1. They act as a check on the accuracy of the ledgers by comparing the balance
of the control account with the total as per the schedule.

2. They locate errors quickly and narrow searching for errors to confined areas.

3. They are useful when a firm needs to find credit sales from incomplete
records.

4. They allow amounts owed by debtors to be ascertained quickly by simply


balancing the control accounts.

Limitations of control accounts.


1. Control accounts do not identify which ledger account may contain an
2. Some types of errors are not revealed by the control account such as
errors of commission, errors of omission, compensating errors, and
errors of original entry.
QUESTION ONE
(B). STATEMENT OF AFFAIR AS AT 31ST DEC 2021
ASSETS
Non current assets.
Van cat valuation 5500
Current assets
bank 920
cash 194
debtor 9200
stock 24200
insurance prepaid 340 34854
TOTAL ASSETS 40354

LIABILITE
Trade creditor 94200
Capital 11400
TOTAL LIABILITES 40354

st
Therefore capital 31 dec, 2022 = 33054.

Workings, W1: debtors control a/c. Cr


Balance c/d 9200 Receipt from debtors 94,200
sales 96,400 Balance c/d 11,400
105,600 105,600

Credit sales = 96,400


Cash sales = 1540
Total sales = 96,400 + 1540 = 97,940.

PROFIT / LOSS A/C for the year ended 31st dec, 2022.

Sales (W1) 97,940


less, Cost of sales
Opening stock 24,200
Add: Purchases (W2) 65,510
89,710
Less: closing stock 27,100 62,610
Gross profit 35,330

Less: opening expenses


Rent (W3) 3,560
Depreciation of van 900
Sundry expenses (820 + 180) 1000
Insurance (W4) 1840
Miscellaneous expenses 12,572 (19,872)
NET PROFIT 15,458

Workings: W2: Creditors control a/c Dr RENT (W3).


Cr
payment 63,400 Balance b/d 7300 bank 3200 P/L 3560
Balance 8100 purchases 64,200 Balance 360
c/d c/d
71,500 71,500 3560 3560

Credit purchases = 64,200 Dr INSURANCE (W4) Cr


Cash purchases = 1310 balance b/d 340 P/L 2240
bank 1900
2240 2240

Total purchases = 64,200 + 1310 = 65,510.

DR. CASH BOOK. CR.

Particulars cash Bank Particulars Cash Bank


Balance b/d 194 920 Cash withdraw 12,600
receipts 94,200 Drawings 11,400
Loan from teng 2,500 Creditor 1310 63,400
sales 1540 Insurance 1900
bank 12,600 Rent 3200
Sundry expenses 180 820
Miscelleneous 12572
expenses
Balance c/d 272 4300
14,334 97,620 14,334 97,620
STATEMENT OF FINANCIAL POSITION AS AT 31ST DEC, 2022.
Assets.
NON-CURRENT ASSETS.
Van 4600
CURRENT ASSETS.
Stock at close 27,100
Debtors 11,400
Cash 272
Bank 4300
Insurance prepaid 400 43,472

48,072

LIABILITIES.
Capital 33054
Add: Net profit 15458
Less: Drawings 11,400 37,112

LIABILITIES.
Loan from ting 2500
Trade creditors 8100
Rent Owings 360 10960

48,072

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