# CIE Accounting Paper-2: Specimen Questions 11 - 13 of 103

## Passage

ABC & Co. started business on 1st January 2014 with a capital of £240000.

During the month, the following transactions took place:

2nd Bought goods from XYZ on credit £60000

5th Sold goods to MNO £75000

5th Cash Purchases £75000

8th Cash Sales £45000

9th Goods returned to XYZ £ 6000

15th Bought Furniture £45000

16th Cash paid to XYZ £36000

16th Loan taken from Mr. K £90000

17th Goods Returned by MNO £9000

20th ABC takes stock for personal use £9000

21st Cash received from MNO £36000

25th Salary paid £15000

28th Purchase of Stationery £ 3000

29th Amount paid to Mr. K on loan Account £ 54000

## Question number: 11 (1 of 5 Based on Passage) Show Passage

Essay Question▾

### Describe in Detail

From the above details prepare the cash ledger A/C

### Explanation

 DATE PARTICUALRS JF AMOUNT £ DATE PARTICUALRS JF AMOUNT £ 01.01. 2014 To Capital A/C 240000 05.01. 2014 By goods A/c 75000 08.01. 2014 To stock A/C 45000 15.01. 2014 By furniture A/C 45000 16.01. 2014 To XYZ A/C 36000 21.01. 2014 By MNO A/C 36000 16.01. 2014 To loan from Mr. K A/C 90000 25.01. 2014 By Salaries A/C 15000 30.01. 2014 To Interest A/C 12000 28.01. 2014 By Stationeries A/C 3000 29.01. 2014 By loan from Mr. K A/C 54000 31.01. 2014 By Balance C/D 195000 423000 423000 01.02. 2014 To balance B/D 195000

## Question number: 12 (2 of 5 Based on Passage) Show Passage

Essay Question▾

### Describe in Detail

What is the purpose of preparing a trial balance?

### Explanation

The first step required in the preparation of final accounts is the preparation of trial balance. The purpose of preparing trial balance is to check the arithmetical accuracy of the double entry system of book keeping. When the totals of the debits and credits of trial balance are equal, it is an indication that there are no errors in the ledger accounts.

## Question number: 13 (3 of 5 Based on Passage) Show Passage

Essay Question▾

### Describe in Detail

The following items will find their place on which side of the trial balance.

(i) Opening Stock: ————————

(ii) Closing Stock: ————————

(iii) Loan taken: ————————-

(iv) Goodwill: ————————

(v) Returns outwards: ————————-

### Explanation

(i) Debit balance

(ii) Will not find place in trial balance

(iii) Credit balance

(iv) Debit balance

(v) Credit balance

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