IGCSE Accounting Paper-1: Specimen Questions with Answers 218 - 220 of 338
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Question 218
Answer
Explanation
Capital Expenditure is the expenditure on the purchase, upgradation, extension or improvement of fixed assets such as land & building, machinery, equipment etc. These expenditures are expected provide economic benefits to the business for more than one accounting period.
Passage
Kamran is a trader who maintains a three column cash book.
He had the following transactions for November 2019.
Nov 2: Purchased goods worth $ 500 for cash.
Nov 7: Received a cheque from Abrar, $ 400 in full settlement of his debt of $ 415
Nov 12: Issued a cheque to Rabia, $ 291 for settlement of her account less 3 % cash discount.
Nov 16: Deposited $ 300 into the bank
Nov 18: Sold an old furniture for cash in $ 800
Nov 22: Withdrawn cash, $ 250 for personal use
Nov 26: Cash sales, $ 320 of which $ 120 was paid directly into the bank
Nov 30. Cash in excess of $ 2000 was deposited into the bank
Question 219 (1 of 5 Based on Passage)
Question
MCQ▾State the ledger under which each of the following accounts would appear (Marks 4)
Choices
| Choice (4) | |
|---|---|
a. | Sales A/c |
b. | Abrar (a credit customer) |
c. | Discount Allowed A/c |
d. | Rabia (a credit supplier) |
Answer
b.Explanation
- Purchases and Trade Payables ledger
- General Ledger
- General Ledger
- Sales and Trade Receivables Ledger
Question 220 (2 of 5 Based on Passage)
Write in Short
Short Answer▾Which type of entries are those on 16th and 30th November? (Marks 1)
Contra Entries
Explanation
- A Contra Entry is an entry for a transaction that affects both cash and bank A/c. If one of the accounts is debited, the other will be credited and vice versa. Examples- Cash deposited into bank or Cash withdrawn from bank.
- On 30 Nov, Kamran՚s bank statement showed a bank balance of $ 220. He compared the cash book with the bank statement found that transactions relating to 7,12 and 30 November had not been recorded by the bank