Question # 1 Mr. Qamar keeps his books under single entry system; hisposition on

Question

Question # 1

Mr. Qamar keeps his books under single entry system; hisposition on 31 December 2002 (at the end of financial year) was asfollows:

Cash in hand Rs. 59,200; Stock Rs. 63,000; Debtors Rs. 48,400;Furniture Rs. 12,000

Creditors Rs. 50,400; Prepaid Insurance Rs. 200. Machinery Rs.10,000

INFORMATION:

• Machinery worth Rs. 2,000 was purchased on 30PthP June2002 and remaining on

30PthP December 2001.

• Depreciate Furniture and Machinery @ 10% p.a.

• Written off bad debts Rs. 2,400 and provide 5% fordoubtful debts.

• Provide interest on capital @ 10% p.a.

Required:

You are required to prepare Statement of affairs as on 31PstPDecember 2002.

Question # 2

From the following particulars of Fine Club, ascertain theamount to be credited to

Income and Expenditure Account in respect ofsubscription for the year 2005.

Subscription received in cash in 2005 10,050

Subscription for 2005 received in advance in 2004 750

Subscription accrued for 2004 900

Subscription accrued for 2005 1050

Explanation / Answer

STATEMENTS OF AFFAIRS

1

31-Dec-02

2

STATEMENTS OF AFFAIRS

1

31-Dec-02

Cash 59200 Stock 63000 Debtors 48400 Furniture 12000 Machinery 10000 Prepaid Insurance 200 Total Assets 192800 Creditor 50400 Capital (Assets-liabilities) 142400 Total liablilities &Capital 192800 Notes: all aditional information is adjusted inthe opening balance of accounts.given on 31 dec01 On 31 dec 2002, the given accounts balanceswere already adjusted.

2

Income & Expenditure 2005 Subscription received in cash 2005 10050 add: advance in 2004 750 add: Accrued for 2005 1050 less: accrued for 2004 900 Subscription for 2005 10950

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