XI Accounting

Question No. 1 (A)

i. Give the rules of Debit and Credit in terms of increase and decrease. (04)
ii. List in sequence the steps included in a complete accounting cycle. (04)

Question No. 1 (B)

Write short notes on any Four of the following: (12)
i. Owner’s Equity
ii. Ledger
iii. Trial Balance
iv. Debit
v. Expense
vi. Petty Cash

Question No. 2

The Ledger and the Trial Balance (20)

A trader started business on January 1st 2007 by investing cash Rs.60,000 and Equipment worth Rs.40,000. During the month of following transactions were completed.
i. Purchased merchandise on credit Rs. 40,000 and paid cartage on it Rs. 2,000 cash.
ii. Sold Merchandise on credit Rs. 18,000 & for cash Rs. 10,000.
iii. The customers Returned merchandise of Rs. 2,000 sold on credit and merchandise returned to suppliers worth Rs. 3,000.
iv. Paid cash to suppliers Rs. 10,000 and cash collected from costumers Rs. 15,000.
v. Cash Paid to employees Rs. 6,000 and cash used by the proprietor Rs. 3.000.

Required
Record the above transactions in the General Journal.

Question No. 3

Accounting For Cash (20)

Record the following transactions in Cash Book.
April 2007
01. Akbar brings Rs. 16000 cash and deposits Rs. 20,000 into bank to start his business.
03. Sold merchandise for cash Rs. 3,000
08. Purchased Equipment for cash Rs. 8,000
10. Received a cheque from a customer for Rs. 2,940 after allowing 2% cash discount.
12. Deposited the cheque received on April 10.
20. Purchased a mobile phone by the owner for his personal use for cash Rs. 2,000.
25. Purchased merchandise by cheque Rs. 5,000
28. Paid through cheque to a supplier Rs. 3920 in settlement of Rs. 4,000′
29. Sold merchandise for cash Rs. 2,500 and deposited Rs. 2,000 into bank.
30. Paid rent by cheque Rs. 3,000 and salaries to employees cash Rs. 6,000.

Required
Record the above transactions in Cash Book and balance the Cash Book.

Question No. 4

Special Journal (20)
The following transactions are to be recorded in Special Journals.
01-04-07 Sold merchandise on credit to Sohail Sons Rs. 2,000
05-04-07 sold merchandise on credit to Bashir Bros. Rs 4,000
08-04-07 Sohail Sons returned merchandise worth Rs. 250.
15-04-07 Sold merchandise on credit to Usman & Co. Rs. 5,000
20-04-07 10% allowance given to Bashir Bros. on defective goods of Rs.2,000 sold to him on April 5.
28-04-07 Sold merchandise on credit to Sohail Sons Rs. 3,000

Required
i. Record the above transactions in appropriate journals.
ii. Post the total of Special Journals to General Ledger giving posting references.

Question No. 5

A comparison of the bank column of the Cash Book and Bank Statement of a trader revealed the following for the month of March 2007. (20)
i. Balances (Cash Book) Rs. 10,200
(Bank Statement)……..Rs. 4,115
ii. Deposit in transit..Rs. 12,000
iii. Outstanding chequesRs. 5,500
iv. Bank credited Rs. 500 mark-up and debited Rs. 85 bank charges not shown in the cash book.

Required
i. What is the correct cash book balance?
ii. Prepare a Bank Reconciliation Statement.

Question No. 6

Financial Statement (20)

The following unadjusted balances are obtained from the ledger of a trader “EZ” for 3 months ended on March 21, 2007.
Cash Rs. 5,000: Accounts Receivable Rs. 27,000: Merchandise Inventory Rs. 30,000: Unexpired Insurance Rs. 3,000: Sales Rs. 1,05,000: Purchases Rs. 60,000: Sales Returns and Allowances Rs. 4,000: Purchase Discount Rs. 2,000: Accounts Payable Rs. 12,000: “EZ” Drawing Rs. 15,000: Unearned Rent Rs. 12,000: General Expense Rs. 2,000: Salaries Expense Rs. 12000: “EZ” Capital?
Adjustment
i. Merchandise inventory valued at Rs. 25,000
ii. Insurance expired 1/3
iii. Unearned Rent 2/3
iv. Accrued Salaries Rs. 3,000

Required
Prepare Income Statement and a Balance Sheet for the first quarter ended March 31, 2007.

Question No. 7

Periodic Adjustments, Closing Process (20)

Pick up data from Question No. 6

Required

Prepare adjusting and closing entries in proper from

Question No. 8 (A)

Correction of Errors (10)
i. Purchase Return of Rs. 500 was credited to Purchase A/C.
ii. Drawing of Rs. 1,000 for personal use of the proprietor was debited to office expense account.
iii. Sale of office Equipment for Rs. 2,000 was credited to sales account.
iv. Rs. 500 spent on the repair of computer was debited to computer accounts.
v. Purchase of furniture for Rs. 5,000 was wrongly debited to purchase account.

Required
Record entries in the General Journal to correct each of the above errors.

Question No. 8 (B)

Cost of Goods Sold (10)

The following balances are taken from the books of Shah & Sons for the year ending Dec 31, 2006.
Purchase | Rs.10,000
Purchase Return | Rs. 1,000
Purchase Discount | Rs. 500
Transport Expense | Rs. 1,200
Merchandise Inventory Opening | Rs. 3,000
Merchandise Inventory Ending | Rs. 2,000

Required
Prepare the statement of cost of goods sold.