A-AS Level (CIE) Accounting Paper-2: Specimen Questions with Answers 5 - 6 of 53

Question 5

Edit

Describe in Detail

Essay▾

Prepare Profit and loss appropriation account for Jennings Company limited.

Explanation

Profit and Loss Appropriation Account for the Year Ended 31st Dec, 2018

Profit and Loss Appropriation Account for the Year Ended 31st Dec, 2018
To General Reserve

To proposed dividend

On Preference share capital 6,000

On equity share capital 20,000

To balance of profit c/d

$

2,00, 000

26000

1,48, 000

3,74, 000

By balance b/d$

3,74, 000

3,74, 000

Question 6

Edit

Describe in Detail

Essay▾

State the different type of contingent liabilities

Explanation

Contingent Liabilities are liabilities which have not arisen, but may arise upon the happening of a certain event. In other words, the liability itself is uncertain. It may or may not involve the payment of money. The amount of contingent liabilities is never shown in the amount of the liability՚s side.

Usual types of contingent liabilities are:

  • Claims against companies not acknowledged as debts or disputed claims.
  • Uncalled liability on partly-paid shares
  • Arrears of dividends on cumulative preference shares
  • Estimated amount of contract remaining to be executed on capital account and not provided for
  • Other moneys for which the company is contingently liable
  • Bills discounted but not matured
  • Guarantee for loan

🎯 Select Paper

Developed by: