Accruals and Prepayments

FA – Nov 2024 – L1 – Q5b – Subscription Account for a Non-Profit Organization

Prepare the subscription account for a football club considering arrears, advance payments, and new subscriptions received.

Question

At 31 March 2023, Kahuro Football Club had membership subscriptions in arrears amounting to GH¢144,000 and had received GH¢36,000 as subscriptions in advance.

During the year ended 31 March 2024, the club received GH¢1,872,000, which included 26 memberships for the year ending 31 March 2025, charged at GH¢1,200 per annum.

At 31 March 2024, 16 members owed a subscription fee of GH¢1,200 each.

Required:

Prepare the subscription account for Kahuro Football Club for the year to 31 March 2024

Answer

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Tags: Accruals and Prepayments, Club Accounts, Membership Fees, Non-Profit Accounting, Subscription Account
Level: Level 1

Topic: Preparation of not-for-profit accounts
Series: Nov 2024

FA – Nov 2024 – L1 – Q4- Preparation of Financial Statements for a Sole Trader

Prepare the Statement of Profit or Loss and Statement of Financial Position for a sole trader from given financial data and adjustments.

Question

The following list of assets, liabilities, and equity as at 30 June 2023 was extracted from the books of Akuorkor, a sole trader:

Trial Balance as at 30 June 2023

Item	GH¢
Plant and equipment – cost	100,000
Accumulated depreciation – Plant & Equipment	36,000
Office fixtures – cost	25,000
Accumulated depreciation – Office Fixtures	2,500
Inventory	15,250
Trade receivables and prepayments	17,500
Trade payables and accrued expenses	8,800
Bank overdraft	4,425
Loan (10% interest per annum)	47,500
Capital	58,525

Summary of Receipts and Payments for the Year Ended 30 June 2024

Receipts	GH¢
Capital introduced	11,000
Cash from customers	213,750
Total Receipts	224,750

Payments	GH¢
Cash drawings (Note 5)	11,225
Loan repayments (Note 7)	10,000
Payment to suppliers	87,800
Rent	11,000
Wages	45,000
Office expenses	6,250
Total Payments	171,275

Additional Information:

Closing inventory on 30 June 2024 was GH¢13,925.
Depreciation policies:
- Plant & Equipment: 20% per annum reducing balance.
- Office Equipment: 10% per annum on cost.
- Fixtures & Fittings: Straight-line method over 4 years with a full year’s charge in the year of acquisition.
GH¢2,500 worth of fixtures & fittings was introduced into the business.
Prepayments and accrued expenses as at 30 June 2023:
- Rent paid in advance: GH¢1,250
- Accrued wages: GH¢2,150
Cash drawings included:
- Wages: GH¢3,375
- Payments to suppliers: GH¢2,100
- Advertising leaflets: GH¢1,300 (Half not yet distributed).
Bank balance per statement: GH¢53,350 after adjusting for unpresented cheques.
Loan repayments include GH¢4,750 in interest payments.
Assets and liabilities as at 30 June 2024:
- Rent paid in advance: GH¢1,350
- Accrued wages: GH¢2,625
- Amounts due to suppliers: GH¢6,100
- Amounts due from customers: GH¢11,150
Major customer went into liquidation owing GH¢8,000; only 20% recoverable.

Required:

Prepare:
i) Statement of Profit or Loss for Akuorkor for the year ended 30 June 2024.
ii) Statement of Financial Position as at 30 June 2024.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accruals and Prepayments, Depreciation, Inventory, Loan Interest, Sole Trader, Statement of Financial Position, Statement of Profit or Loss
Level: Level 1

Topic: Preparation of financial statements of a sole trader
Series: Nov 2024

FA – May 2018 – L1 – Q5 – Preparation of limited liability company financial statements

Prepare a Statement of Profit or Loss and a Statement of Financial Position from a provided trial balance and additional information.

Question

Sawaba Limited is a company involved in the construction and fitting of kitchens and wardrobes. The following trial balance was extracted from its books as at 31 October 2017:

The following information, based on your investigations, has also come to your attention:
i) Inventory as at 31 October 2017 was GH¢387,100.
ii) Depreciation is to be charged as follows:

Buildings 4% Straight Line on Cost
Plant & Equipment 15% of Reducing Balance
Land is not being depreciated.
iii) The land and buildings were revalued in total at GH¢1,300,000, of which land amounted to GH¢200,000, as at 31 October 2017. This has not been recorded in the books.
iv) Rent relates to a display unit rented, and its rental period is yearly starting on 1 April each year. The yearly amount of GH¢12,000 is paid in full on this date.
v) There are outstanding balances for Marketing Costs, Salaries, and Telephone Expenses amounting to GH¢2,420, GH¢3,610, and GH¢280, respectively, which have not yet been included in the above trial balance.
vi) A customer owing GH¢6,000 went into liquidation. The liquidator has assured Sawaba Limited that it will receive 10% of the amount. Sawaba Limited has decided that the Allowance for Doubtful Debts should be set at 5%.
vii) Provide for any Loan interest due.
viii) All Expenses are to be allocated evenly between Distribution Costs and Administrative Expenses.

Required:
Prepare a Statement of Profit or Loss Account and Statement of Financial Position for Sawaba Limited for the financial year-ending 31 October 2017. (20 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accruals and Prepayments, Bad Debt, Depreciation, Financial Statements, Profit or Loss Account, Statement of Financial Position
Level: Level 1

Topic: Preparation of limited liability company financial statements
Series: MAY 2018

FA – Nov 2024 – L1 – Q5b – Subscription Account for a Non-Profit Organization

Prepare the subscription account for a football club considering arrears, advance payments, and new subscriptions received.

Question

At 31 March 2023, Kahuro Football Club had membership subscriptions in arrears amounting to GH¢144,000 and had received GH¢36,000 as subscriptions in advance.

During the year ended 31 March 2024, the club received GH¢1,872,000, which included 26 memberships for the year ending 31 March 2025, charged at GH¢1,200 per annum.

At 31 March 2024, 16 members owed a subscription fee of GH¢1,200 each.

Required:

Prepare the subscription account for Kahuro Football Club for the year to 31 March 2024

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accruals and Prepayments, Club Accounts, Membership Fees, Non-Profit Accounting, Subscription Account
Level: Level 1

Topic: Preparation of not-for-profit accounts
Series: Nov 2024

FA – Nov 2024 – L1 – Q4- Preparation of Financial Statements for a Sole Trader

Prepare the Statement of Profit or Loss and Statement of Financial Position for a sole trader from given financial data and adjustments.

Question

The following list of assets, liabilities, and equity as at 30 June 2023 was extracted from the books of Akuorkor, a sole trader:

Trial Balance as at 30 June 2023

Item	GH¢
Plant and equipment – cost	100,000
Accumulated depreciation – Plant & Equipment	36,000
Office fixtures – cost	25,000
Accumulated depreciation – Office Fixtures	2,500
Inventory	15,250
Trade receivables and prepayments	17,500
Trade payables and accrued expenses	8,800
Bank overdraft	4,425
Loan (10% interest per annum)	47,500
Capital	58,525

Summary of Receipts and Payments for the Year Ended 30 June 2024

Receipts	GH¢
Capital introduced	11,000
Cash from customers	213,750
Total Receipts	224,750

Payments	GH¢
Cash drawings (Note 5)	11,225
Loan repayments (Note 7)	10,000
Payment to suppliers	87,800
Rent	11,000
Wages	45,000
Office expenses	6,250
Total Payments	171,275

Additional Information:

Closing inventory on 30 June 2024 was GH¢13,925.
Depreciation policies:
- Plant & Equipment: 20% per annum reducing balance.
- Office Equipment: 10% per annum on cost.
- Fixtures & Fittings: Straight-line method over 4 years with a full year’s charge in the year of acquisition.
GH¢2,500 worth of fixtures & fittings was introduced into the business.
Prepayments and accrued expenses as at 30 June 2023:
- Rent paid in advance: GH¢1,250
- Accrued wages: GH¢2,150
Cash drawings included:
- Wages: GH¢3,375
- Payments to suppliers: GH¢2,100
- Advertising leaflets: GH¢1,300 (Half not yet distributed).
Bank balance per statement: GH¢53,350 after adjusting for unpresented cheques.
Loan repayments include GH¢4,750 in interest payments.
Assets and liabilities as at 30 June 2024:
- Rent paid in advance: GH¢1,350
- Accrued wages: GH¢2,625
- Amounts due to suppliers: GH¢6,100
- Amounts due from customers: GH¢11,150
Major customer went into liquidation owing GH¢8,000; only 20% recoverable.

Required:

Prepare:
i) Statement of Profit or Loss for Akuorkor for the year ended 30 June 2024.
ii) Statement of Financial Position as at 30 June 2024.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accruals and Prepayments, Depreciation, Inventory, Loan Interest, Sole Trader, Statement of Financial Position, Statement of Profit or Loss
Level: Level 1

Topic: Preparation of financial statements of a sole trader
Series: Nov 2024

FA – May 2018 – L1 – Q5 – Preparation of limited liability company financial statements

Prepare a Statement of Profit or Loss and a Statement of Financial Position from a provided trial balance and additional information.

Question

Sawaba Limited is a company involved in the construction and fitting of kitchens and wardrobes. The following trial balance was extracted from its books as at 31 October 2017:

The following information, based on your investigations, has also come to your attention:
i) Inventory as at 31 October 2017 was GH¢387,100.
ii) Depreciation is to be charged as follows:

Buildings 4% Straight Line on Cost
Plant & Equipment 15% of Reducing Balance
Land is not being depreciated.
iii) The land and buildings were revalued in total at GH¢1,300,000, of which land amounted to GH¢200,000, as at 31 October 2017. This has not been recorded in the books.
iv) Rent relates to a display unit rented, and its rental period is yearly starting on 1 April each year. The yearly amount of GH¢12,000 is paid in full on this date.
v) There are outstanding balances for Marketing Costs, Salaries, and Telephone Expenses amounting to GH¢2,420, GH¢3,610, and GH¢280, respectively, which have not yet been included in the above trial balance.
vi) A customer owing GH¢6,000 went into liquidation. The liquidator has assured Sawaba Limited that it will receive 10% of the amount. Sawaba Limited has decided that the Allowance for Doubtful Debts should be set at 5%.
vii) Provide for any Loan interest due.
viii) All Expenses are to be allocated evenly between Distribution Costs and Administrative Expenses.

Required:
Prepare a Statement of Profit or Loss Account and Statement of Financial Position for Sawaba Limited for the financial year-ending 31 October 2017. (20 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accruals and Prepayments, Bad Debt, Depreciation, Financial Statements, Profit or Loss Account, Statement of Financial Position
Level: Level 1

Topic: Preparation of limited liability company financial statements
Series: MAY 2018

Question Tag: Accruals and Prepayments

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FA – Nov 2024 – L1 – Q5b – Subscription Account for a Non-Profit Organization

Prepare the subscription account for a football club considering arrears, advance payments, and new subscriptions received.

Required:

FA – Nov 2024 – L1 – Q4- Preparation of Financial Statements for a Sole Trader

Prepare the Statement of Profit or Loss and Statement of Financial Position for a sole trader from given financial data and adjustments.

Trial Balance as at 30 June 2023

Summary of Receipts and Payments for the Year Ended 30 June 2024

Additional Information:

Required:

FA – May 2018 – L1 – Q5 – Preparation of limited liability company financial statements

Prepare a Statement of Profit or Loss and a Statement of Financial Position from a provided trial balance and additional information.

FA – Nov 2024 – L1 – Q5b – Subscription Account for a Non-Profit Organization

Prepare the subscription account for a football club considering arrears, advance payments, and new subscriptions received.

Required:

FA – Nov 2024 – L1 – Q4- Preparation of Financial Statements for a Sole Trader

Prepare the Statement of Profit or Loss and Statement of Financial Position for a sole trader from given financial data and adjustments.

Trial Balance as at 30 June 2023

Summary of Receipts and Payments for the Year Ended 30 June 2024

Additional Information:

Required:

FA – May 2018 – L1 – Q5 – Preparation of limited liability company financial statements

Prepare a Statement of Profit or Loss and a Statement of Financial Position from a provided trial balance and additional information.

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Question Tag: Accruals and Prepayments

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FA – Nov 2024 – L1 – Q5b – Subscription Account for a Non-Profit Organization

Prepare the subscription account for a football club considering arrears, advance payments, and new subscriptions received.

Required:

You're reporting an error for "FA – Nov 2024 – L1 – Q5b – Subscription Account for a Non-Profit Organization"

FA – Nov 2024 – L1 – Q4- Preparation of Financial Statements for a Sole Trader

Prepare the Statement of Profit or Loss and Statement of Financial Position for a sole trader from given financial data and adjustments.

Trial Balance as at 30 June 2023

Summary of Receipts and Payments for the Year Ended 30 June 2024

Additional Information:

Required:

You're reporting an error for "FA – Nov 2024 – L1 – Q4- Preparation of Financial Statements for a Sole Trader"

FA – May 2018 – L1 – Q5 – Preparation of limited liability company financial statements

Prepare a Statement of Profit or Loss and a Statement of Financial Position from a provided trial balance and additional information.

You're reporting an error for "FA – May 2018 – L1 – Q5 – Preparation of limited liability company financial statements"

FA – Nov 2024 – L1 – Q5b – Subscription Account for a Non-Profit Organization

Prepare the subscription account for a football club considering arrears, advance payments, and new subscriptions received.

Required:

You're reporting an error for "FA – Nov 2024 – L1 – Q5b – Subscription Account for a Non-Profit Organization"

FA – Nov 2024 – L1 – Q4- Preparation of Financial Statements for a Sole Trader

Prepare the Statement of Profit or Loss and Statement of Financial Position for a sole trader from given financial data and adjustments.

Trial Balance as at 30 June 2023

Summary of Receipts and Payments for the Year Ended 30 June 2024

Additional Information:

Required:

You're reporting an error for "FA – Nov 2024 – L1 – Q4- Preparation of Financial Statements for a Sole Trader"

FA – May 2018 – L1 – Q5 – Preparation of limited liability company financial statements

Prepare a Statement of Profit or Loss and a Statement of Financial Position from a provided trial balance and additional information.

You're reporting an error for "FA – May 2018 – L1 – Q5 – Preparation of limited liability company financial statements"

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