IGCSE Accounting Paper-1: Specimen Questions with Answers 115 - 116 of 338

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 2,015 31 October 2,015

$ $

Non-current (fixed) assets 10 000 12 000

Current assets 100 000 90 500

Current liabilities 25 000 23 000

Question 115 (1 of 4 Based on Passage)

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Short Answer▾

Prepare Ryno’s statement of affairs on 31 October 2,015 showing his total capital at that date.

He decided to increase the provision for doubtful debts by $ 1,500 on 31 October 2,015

Ryno’s – Statement of Affairs at 31st October 2,015

Explanation

Statement of affairs at 31st October 2,015

Statement of Affairs as on 31st October 2,015
Particulars

$

$

Fixed Assets

Current Assets

Less: Current Liabilities

100,000 - 9,500 = 90,500

23,000

12,000

67,500

———

79,500

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.

Question 116 (2 of 4 Based on Passage)

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Short Answer▾

Prepare Ryno’s capital account for the year ended 31 October 2,015. If he took drawings of $ 500 each month.

Explanation

Ryno’s capital account

Find Out Amount in Date Wise
Date

Particulars

Amount

$

Date

Particulars

Amount

$

October 31

Drawings

6,000

November 1

Balance

85,000

October 31

Balance

79,500

The capital account of the Ryno’s reflects his financial position towards the business and his capital value at the end of the October 31st 2,015. The balance on each month is carried forward from the statement of affairs of respective months.

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