CIE Accounting Paper-1: Specimen Questions with Answers 147 - 148 of 214

Passage

Kiran has a trading business and pays the repair expenses of running a motor van. At 1st May 2015 he had accrued repair expenses of $300. For the year ended 30st April 2015 he paid repair expenses of $3400 by cheque and at 30 April 2015 he had an unpaid bill for repair of $500.

Question number: 147 (2 of 2 Based on Passage) Show Passage

Short Answer Question▾

Write in Short

Write up Kiran’s rent expenses account for the year ended 30st April 2015. Show the transfer to the income statement for the year and any balance carried down at 1 May 2015.

Explanation

Income statement as $3600 and Balance carried down at 1 May 2015 is $500

Repair expenses account of Kiran as on 30th April 2015

Calculate given this table values.

Repair Expenses Account

Date

Particular

Amoun$

Date

Particular

Amount $

1st May 2015

Balance b/d

300

30th April 2015

Bank

Balanced c/d

3400

500

3900

30th April 2015

Income Statement (Balancing figure)

3600

3900

Balance b/d

500

Question number: 148

MCQ▾

Question

Zenith owed Ali $600. Zenith was only able to pay Ali $200. Ahmed wrote the balance off as a bad debt.

Which entries record this in Ahmed’s ledger?

Choices

Choice (4) Response

a.

showing in Journal entry in the Ahmeds ledger

shows given table in bas debts is 400

Account to be debited $

Account to be credited $

Bad debts 400

Bank 200

Zenith 600

b.

showing Account to debited in a given table.

Calculate the zenith and Bank

Account to be debited $

Account to be credited $

Zenith 400

Bank 200

Bad debts 600

c.

Account to debited in a given table.

Calculate the bad debts and zenith

Account to be debited $

Account to be credited $

Bad debts 400

Zenith 200

Bank 600

d.

Journal entry in the Ahmeds ledger

shows given table in bas debts is 600

Account to be debited $

Account to be credited $

Bad debts 600

Bank 200

Zenith 400

Answer

a.

Explanation

The bad debt refers to the trade accounts which are not receivable during the year. The trade account receivable is also known as accounts receivable. The amount receivable debts which became bad are known as bad debts.