IGCSE Accounting Paper-1: Specimen Questions with Answers 196 - 198 of 338

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Passage

Mr. Shah have the following transaction in the month of April 2015:

Mr. Shah Have the Following Transaction in the Month of April 2015
April
1Shah started business with cash $ 20000
2Cash purchases $ 5000
3Goods sold to Naresh on credit $ 4500
4Paid carriage $ 1000
5Purchases by cheque $ 6000

Question 196 (2 of 4 Based on Passage)

Describe in Detail

Essay▾

Find the missing figure of the following:

Calculation of Missing Figures Using Accounting Equation
Type of businessAssets

$

Liabilities

$

Capital

$

Readymade Garments200018000
Book - seller200009000
Cycle mart60002500

Explanation

Calculate Assets $ , Liabilities $ , Capital $
Type of businessAssets

$

Liabilities

$

Capital

$

Readymade Garments20000200018000
Book - seller20000110009000
Cycle mart600025004500

The following ways missing figures can be calculated by using formula:

Assets = Capital + Liabilities

Liabilities = Assets - Capital

Capital = Assets – Liabilities

Question 197 (3 of 4 Based on Passage)

Describe in Detail

Essay▾

In the table below, show how the transaction on 2 April should be posted to the ledger.

The Ledger Account of Mr. Shah
Name of AccountDr

$

Cr

$

Explanation

Name of Account, Dr $ , Cr $
Name of AccountDr

$

Cr

$

Purchases5000

The cash purchase only accepted and not the credit purchases. The purchases always entered in the debit side of the ledger account. The credit purchase will appear in the purchase book of the company.

Question 198 (4 of 4 Based on Passage)

Edit

Describe in Detail

Essay▾

Write a short note on Contra Entry.

Explanation

When an entry affected in both cash and bank accounts it is called a contra entry. It is derived from Latin language Contra and its means opposite. In contra entries both the debit and credit aspects of a transaction are recorded in the cash book itself.

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