CIE Accounting Paper-2: Specimen Questions 23 - 26 of 103

Passage

RK Industries closes its books of accounts every year on June 30th. During the year it made purchases from various suppliers amounting to £ 640000. The books were opened with a stock of £890000. During the year RK Industries made payments to its creditors £576000. Purchases worth £124000 did not meet the standards required by RK industries and were hence returned back to the suppliers Discounts received during the year was £50000

Question number: 23 (3 of 5 Based on Passage) Show Passage

Essay Question▾

Describe in Detail

In Control A/C ’s, the following are named as:

(i) Creditor’s ledger: …………………………. .

(ii) Debtor’s ledger: ………………………………

Explanation

(i) Purchase Ledger Control A/C (ii) Sales Ledger Control A/C

Question number: 24 (4 of 5 Based on Passage) Show Passage

Essay Question▾

Describe in Detail

Pass the journal entry in the books of RK Industries to record the total purchases in the creditors control A/C in the general ledger?

Explanation

Journal entry in the books of RK Industries

shows Journal entry in the books of RK Industries

Date

Particulars

L. F

Debit Amt

Credit Amt

30-Jun

Purchases A/C Dr

780000

To Creditor’s control A/C

780000

(Being total purchases transferred to the creditors control A/C in the general ledger)

Question number: 25 (5 of 5 Based on Passage) Show Passage

Essay Question▾

Describe in Detail

Where does RK Industry record its cash purchases and sales when it maintains control system of accounting?

Explanation

RK Industries maintains a General ledger. All cash sales and cash purchases will find its place in this ledger. They are not accounted in the control ledgers.

Passage

The following transactions are shown in the books of Mr. Ringon for the month of January 2007.

Jan 1st Received a cheque from Mr. Fatso to whom goods were sold for £20000, allowed him 1%

Jan 2nd Mr. Fatso’s cheque was deposited in bank

Jan 5th Mr. Fatso‘s cheque was dishonored (bank charges £100)

Jan 8th Mr. Fatso settled his account by means of a cheque £20250, £150 being interest charged.

Question number: 26 (1 of 5 Based on Passage) Show Passage

Essay Question▾

Describe in Detail

What are the advantages enjoyed by Mr. Ringon while maintaining a three columnar cash book?

Explanation

In a three columnar cash book three separate columns are maintained for cash, bank and discount on each side respectively Mr. Ringon, who has large volumes of business transactions has an advantage in maintaining a three columnar cash book, as the cash and bank balances of the business concern is known at a glance. A cash book is prepared periodically mostly monthly.

Share