IGCSE Accounting Paper-1: Specimen Questions with Answers 112 - 115 of 214
Passage
Roshan had the following transaction:
a. Roshan started business with $25000
b. Purchased goods on credit from Sohan $10000
c. Solds goods to Sam costing $1500 for $1800 on credit.
Question number: 112 (1 of 2 Based on Passage) Show Passage
Write in Short
Show your calculation regarding the accounting equation.
Explanation
Assets = $35300 Liabilities $10000; Capital $25300
Solution: The accounting equation includes:
| Sl No | Equities | Assets | |||
| Capital | creditors | Cash | Stock | Debtors | |
| a. | 25000 | 25000 | |||
| b. | 10000 | 10000 | |||
| c. | 300 | 10000 - 1500 | |||
| 35300 | 35300 | ||||
Question number: 113 (2 of 2 Based on Passage) Show Passage
Write in Short
Calculate assets on the basis of accounting equation:
Explanation
$35300
Assets includes cash from capital, stock on credit purchase, deduct cost stock amount sold and add credit sale amount. Thus assets includes
Question number: 114
Question
When a bill is accepted, it will be entered by the acceptor in ________
Choices
| Choice (4) | Response | |
|---|---|---|
| a. | Bills Receivable book |
|
| b. | Bills Payable book |
|
| c. | Bills book |
|
| d. | Bills accepted book |
|
Answer
b.Explanation
Bills receivable book records the receipts of bill from the customers and bills payable book records the bills accepted by the trader. If the holder of bill is in need of money he can convert into cash through the bank.
Passage
Ryno has a business selling spare parts for cars. He lost many of his financial records in a flood but has been able to provide the following information.
1 November 2015 31 October 2015
$ $
Non-current (fixed) assets 10 000 12 000
Current assets 100 000 90 500
Current liabilities 25 000 23 000
Question number: 115 (1 of 4 Based on Passage) Show Passage
Write in Short
Prepare Ryno’s statement of affairs on 31 October 2015 showing his total capital at that date.
He decided to increase the provision for doubtful debts by $1500 on 31 October 2015
Ryno’s – Statement of Affairs at 31st October 2015
Explanation
Statement of affairs at 31st October 2015
| Particulars | $ | $ |
| Fixed Assets Current Assets Less: Current Liabilities | 100000 - 9500 = 90500 23000 | 12000 67500 ——— 79500 |
The statements of affairs are prepared when business maintained the incomplete record of business transaction. Hence profit or loss of the business can be ascertained through the Statement of affairs method.