Ledger accounts – Knowsia

FA – L1 – Q49 – Control accounts and account reconciliations

Prepare receivables and payables control accounts for Sahara Health Ltd for 20X9 using provided financial data.

Question

Sahara Health Ltd has an accounting system where all separate ledger accounts are maintained for each individual customer and supplier.
The management wishes to draft the related control accounts.
The following information is available:

Description	GH₵
Receivables as on December 31, 20X8	32,000,000
Payables as on December 31, 20X8	23,350,000
Cheques issued to suppliers in settlement	14,360,000
Cash sales memos issued	550,000
Goods returned to suppliers	180,000
Cheques received from receivables in settlement	31,650,000
Cheque received from suppliers against return of goods	120,000
Credit sales invoices issued	35,900,000
Returns by customers: from cash sales	320,000
Returns by customers: from credit sales	980,000
Goods purchased on credit	27,700,000
Cash refund to a debtor who had paid the amount due twice	200,000
Cheque issued by a debtor on Dec. 28, 20X8 was dishonoured on May 13, 20X9	500,000
Increase in allowance for receivables (from GH₵1,750,000 to GH₵2,250,000)	500,000
Irrecoverable debts written off	430,000
Contra settlement between payables and receivables accounts	1,660,000
Credit balances included in customers’ accounts as on December 31, 20X9	75,000
A supplier’s invoice received on December 30, 20X9 relating to goods supplied on December 28, 20X9 has not been entered in the books	350,000

Required
Prepare the receivables and payables control accounts from the above information for the year ended December 31, 20X9.

Answer

Find Related Questions by Tags, levels, etc.

Topic: Control accounts and account reconciliations

FA – L1 – Q45 – Inventory

Record inventory in ledger accounts and prepare trading account for Mensah and Associates for 20X9, adjusting for post-year-end transactions.

Question

Mensah and Associates carried out a physical count on 31 December 20X8 and finds GH₵10,000 of inventory in its warehouse.
During the year ended 31 December 20X9 the company makes GH₵70,000 of sales and buys GH₵58,000 of supplies.
The company carries out a physical count for the year ended 31 December 20X9 on 7 January 20X9 and finds GH₵15,000 worth of goods. In the six day intervening period there were sales of goods which had cost GH₵4,800 and deliveries inwards of goods costing GH₵8,000.

Required
Record inventory in the relevant ledger accounts and prepare the trading account for inclusion in the statement of profit or loss for the year ended 31 December 20X9.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Closing Inventory, Cost of Sales, Financial Statements, Inventory, Ledger accounts, Physical Count, Purchases, Sales, Sole Trader, Trading Account
Level: Level 1

Topic: Inventory

FA – L1 – Q43 – Inventory

Write up inventory, purchases, and revenue accounts for two years for a sole trader.

Question

Kofi started business on 1 January 20X8. At the end of his first year of trading he had closing inventory of GH¢5,000. During 20X9 he traded continuously and at 31 December 20X9 he had inventory amounting to GH¢7,500.
Sales for 20X8 and 20X9 were GH¢120,000 and GH¢155,000 respectively and purchases were GH¢75,000 and GH¢110,000 respectively.

Required
(a) Write up the inventory account, purchases account, and revenue account for the two years.

(b) Prepare the trading account for EACH of the two years.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Financial Statements, Inventory, Ledger accounts, Purchases, Revenue, Sole Trader, Trading Account
Level: Level 1

Topic: Inventory

FA – L1 – Q41 – Preparing financial statements of a sole trader

Prepare Kweku's statement of profit or loss and financial position for 20X9 using trial balance and adjustments.

Question

The following list of account balances was extracted from the books of Kweku at 30 April 20X9.

	Dr GH¢(000)	Cr GH¢(000)
Revenue		18,955
Purchases	12,556
Inventory 1 May 20X8	3,776
Salaries and wages	2,447
Motor expenses	664
Rent	456
Rates	120
Insurance	146
Packing expenses	276
Lighting and heating expenses	665
Sundry expenses	115
Motor vehicles	2,400
Fixtures and fittings	600
Trade receivables	4,577
Trade payables		3,045
Cash at bank	3,876
Cash in hand	120
Drawings	2,050
Capital		12,844
	34,844	34,844

Notes at 30 April:
(1) Expenses which have been prepaid – rates GH¢20,000; Insurance GH¢35,000.
(2) Expenses which are owing – motor expenses GH¢56,000; rent GH¢24,000; sundry expenses GH¢26,000.
(3) Inventory GH¢4,998,000.

Required:
From the list of balances and the notes, prepare Kweku’s statement of profit or loss for the year ended 30 April 20X9 and a statement of financial position at that date.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accruals, Adjustments, Financial Statements, Inventory, Ledger accounts, Prepayments, Profit or Loss, Sole Trader, Statement of Financial Position, Trial Balance
Level: Level 1

Topic: Preparing financial statements of a sole trader

FA – L1 – Q40 – Accruals and prepayments

Prepare rent receivable and interest payable ledger accounts for James for 20X9 based on given rental and interest data.

Question

James owns various properties which he rents out under short-term lets; some tenants pay in advance, some in arrears. Similarly with his various borrowings the interest is paid in arrears and in advance.
During 20X9 rent collected was GH₵229,500 and interest charged to the statement of profit or loss was GH₵52,500.
Rents receivable and paid in advance together with amounts of interest prepaid and payable at the statement of financial position dates were as follows.

	31 December
	20X8	20X9
	GH₵	GH₵
Rents owed by tenants	34,200	40,500
Rents prepaid by tenants	20,700	15,300
Prepaid interest	3,500	5,600
Interest payable	9,800	7,000

Required
Write up the rent receivable account and the interest payable account for the year ended 31 December 20X9.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accruals, Financial Statements, Interest Payable, Ledger accounts, Prepayments, Rent Receivable
Level: Level 1

Topic: Accruals and prepayments

FA – L1 – Q38 – Accruals and prepayments

Record adjustments for stationery, rent, rates, insurance, and lighting in ledger accounts for Nyame at 31 Dec 20X9.

Question

The following is an extract from the trial balance of Nyame at 31 December 20X9.

| | Dr | Cr | |

| GH¢(000) | GH¢(000) |

| Stationery | 560 |

| | Rent | 900 | |

| Rates | 380 | |

| Lighting and heating | 590 | |

| Insurance | 260 | |

| Wages and salaries | 2,970 | |

There was stationery still in hand at 31 December 20X9 which had cost GH¢15,000.
Rent of GH¢300,000 for the last three months of 20X9 had not been paid and no entry has been made in the books at all for it.
Of the rates, GH¢280,000 was for the year ended 31 March 20Y0. The remaining GH¢100,000 was for the three months ended 31 March 20X9.
Fuel had been delivered on 18 December 20X9 at a cost of GH¢15,000 and had been consumed before the end of 20X9. No invoice had been received for the GH¢15,000 fuel in 20X9 and no entry has been made in the records of the business.
GH¢70,000 of the insurance paid was in respect of insurance cover for the year 20Y0.
Nothing was owing to employees for wages and salaries at the close of 20X9.
Required:
Record the above information in the relevant accounts for the year ended 31 December 20X9 and close the accounts.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accruals, Adjustments, Financial Statements, Insurance, Ledger accounts, lighting and heating, Prepayments, rates, rent, stationery, Trial Balance
Level: Level 1

Topic: Accruals and prepayments

FA – L1 – Q37 – Accruals and prepayments

Write up the insurance account for Vulcan's removal business for 20X9, including prepayments and multiple insurance payments.

Question

Vulcan owns a removal business and runs a small fleet of vans. He prepares his accounts to 31 December each year.
The following transactions occur in relation to insurance for the year 20X9.
1 January: The amount prepaid for insurance was GH¢1,140,000.
1 April: He paid GH¢840,000 insurance for the year ended 31 March 20Y0 on six of the vans.
1 May: He paid GH¢3,540,000 insurance for twenty vans for the year ended 30 April 20Y0.
1 July: He paid GH¢560,000 insurance for the remaining vans for the year ended 30 June 20Y0.

Required:
Write up the insurance account for the year ended 31 December 20X9.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accruals, Bookkeeping, Financial accounting, Insurance, Ledger accounts, Non-current Assets, Prepayments, Statement of Financial Position, Trial Balance, Year-end adjustments
Level: Level 1

Topic: Accruals and prepayments

FA – L1 – Q36 – Accruals and prepayments

Write up water expense ledger accounts for 20X8 and 20X9 under different payment scenarios.

Question

Kieran started a business on 1 January 20X8.

Accounting year ended 31 December 20X8:

A new warehouse was acquired on 31 March 20X8. On 21 April 20X8, Kieran received a water bill demand for GH₵1,000,000 for the 12 months to 31 March 20X9. Payment was made, in full, on 30 April 20X8.

Accounting year ended 31 December 20X9:

An office extension was built. The water bill demand for the 12 months to 31 March 20Y0 was GH₵1,600,000. Kieran paid the full amount on 1 June 20X9.

Required:

(a) Write up the water expense ledger account for 20X8 and for 20X9.

(b) Assuming now that payments were made annually in arrears (i.e. GH₵1,000,000 on 31 March 20X9 and GH₵1,600,000 on 31 March 20Y0), write up the water expense ledger account for each of the two accounting years.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Accruals, Financial Adjustments, Ledger accounts, Prepayments, Water Expense
Level: Level 1

Topic: Accruals and prepayments

FA – L1 – Q35 – Bad and doubtful debt

Write up receivables, irrecoverable debts expense, and allowance accounts for three years with specific and general allowances, including financial position extracts.

Question

In her first year of trading to 31 December 20X7, Akosua made credit sales of GH₵200,000 and received GH₵150,000 from credit customers.
At the end of the year, she decided to write off Abena’s debt of GH₵8,000, make a specific allowance for Kofi’s debt totalling GH₵3,500, and create a general allowance of 5% of remaining trade receivables.
During her second year of trading, she made sales on credit of GH₵300,000 and received cash of GH₵280,000, including GH₵4,000 from Abena. At 31 December 20X8, she decided to write off Kofi’s debt and create a specific allowance against 50% of Esi’s total debt of GH₵6,000. She decided that a general allowance should now be 8% of remaining accounts receivable.
In the year to 31 December 20X9, Akosua made credit sales of GH₵500,000 and received cash of GH₵400,000. Separate from this, she also received a cheque from Esi for GH₵6,000.
At the year-end, she decided to create a specific allowance against Kwame’s debt of GH₵50,000 and maintain a general allowance at 8%.

Required
For each of the above years, show the trade receivables account, irrecoverable debt expense account, and allowance for receivables account, and the statement of financial position extract as at each year end.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Allowance for receivables, Bad Debts, Cash receipts, Credit Sales, Doubtful debts, Ghana, Irrecoverable debts, Ledger accounts, Trade Receivables, Year-end adjustments
Level: Level 1

Topic: Bad and doubtful debt

FA – L1 – Q34 – Bad and doubtful debt

Write up irrecoverable debt expense and allowance for receivables accounts for three years with specific and general allowances.

Question

Kwame commenced trading on 1 April 20X6. He extracted the following list of balances from his sales ledger as at 31 March 20X7:

	GH₵
Kojo	200,000
Ama	400,000
Others	6,300,000
	6,900,000

In the year to 31 March 20X7:
(1) Kojo emigrated leaving numerous debts.
(2) Ama is disputing certain invoices, amounting to GH₵100,000, which have been outstanding for more than six months. Kwame estimates that Ama will eventually pay half the disputed amount.

In the year to 31 March 20X8:
The sales ledger listing as at 31 March 20X8 is as follows:

	GH₵
Esi	240,000
Adwoa	400,000
Ama	60,000
Others	6,600,000
	7,300,000

(1) Esi has been declared bankrupt and her debt is to be written off.
(2) Adwoa is experiencing cash flow difficulties. Kwame considers a 50% allowance to be appropriate.
(3) Kwame is no longer supplying goods to Ama. The balance, which is in respect of last year’s disputed invoices, is to be written off.

In the year to 31 March 20X9:
(1) Total receivables per the sales ledger listing are GH₵7,500,000 as at 31 March 20X9.
(2) There are no debts requiring specific allowance.
(3) GH₵50,000 has been received from Esi.

Required
Assuming that Kwame requires a general allowance for receivables of 5%, write up the irrecoverable debt expense and allowance accounts for the three years to 31 March 20X9.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Allowance for receivables, Bad Debts, Credit Sales, Doubtful debts, Ghana, Irrecoverable debts, Ledger accounts, Trade Receivables, Year-end adjustments
Level: Level 1

Topic: Bad and doubtful debt

Tag (SQ): Ledger accounts

Filter by Professional Bodies

Filter by Subject

Filter by Topics

Filter by Levels

FA – L1 – Q49 – Control accounts and account reconciliations

Prepare receivables and payables control accounts for Sahara Health Ltd for 20X9 using provided financial data.

FA – L1 – Q45 – Inventory

Record inventory in ledger accounts and prepare trading account for Mensah and Associates for 20X9, adjusting for post-year-end transactions.

FA – L1 – Q43 – Inventory

Write up inventory, purchases, and revenue accounts for two years for a sole trader.

FA – L1 – Q41 – Preparing financial statements of a sole trader

Prepare Kweku's statement of profit or loss and financial position for 20X9 using trial balance and adjustments.

FA – L1 – Q40 – Accruals and prepayments

Prepare rent receivable and interest payable ledger accounts for James for 20X9 based on given rental and interest data.

FA – L1 – Q38 – Accruals and prepayments

Record adjustments for stationery, rent, rates, insurance, and lighting in ledger accounts for Nyame at 31 Dec 20X9.

FA – L1 – Q37 – Accruals and prepayments

Write up the insurance account for Vulcan's removal business for 20X9, including prepayments and multiple insurance payments.

FA – L1 – Q36 – Accruals and prepayments

Write up water expense ledger accounts for 20X8 and 20X9 under different payment scenarios.

FA – L1 – Q35 – Bad and doubtful debt

Write up receivables, irrecoverable debts expense, and allowance accounts for three years with specific and general allowances, including financial position extracts.

FA – L1 – Q34 – Bad and doubtful debt

Write up irrecoverable debt expense and allowance for receivables accounts for three years with specific and general allowances.

Our offerings

Contact Info

Customer

Get In Touch

Tag (SQ): Ledger accounts

Filter by Professional Bodies

Filter by Subject

Filter by Topics

Filter by Levels

FA – L1 – Q49 – Control accounts and account reconciliations

Prepare receivables and payables control accounts for Sahara Health Ltd for 20X9 using provided financial data.

You're reporting an error for "FA – L1 – Q49 – Control accounts and account reconciliations"

FA – L1 – Q45 – Inventory

Record inventory in ledger accounts and prepare trading account for Mensah and Associates for 20X9, adjusting for post-year-end transactions.

You're reporting an error for "FA – L1 – Q45 – Inventory"

FA – L1 – Q43 – Inventory

Write up inventory, purchases, and revenue accounts for two years for a sole trader.

You're reporting an error for "FA – L1 – Q43 – Inventory"

FA – L1 – Q41 – Preparing financial statements of a sole trader

Prepare Kweku's statement of profit or loss and financial position for 20X9 using trial balance and adjustments.

You're reporting an error for "FA – L1 – Q41 – Preparing financial statements of a sole trader"

FA – L1 – Q40 – Accruals and prepayments

Prepare rent receivable and interest payable ledger accounts for James for 20X9 based on given rental and interest data.

You're reporting an error for "FA – L1 – Q40 – Accruals and prepayments"

FA – L1 – Q38 – Accruals and prepayments

Record adjustments for stationery, rent, rates, insurance, and lighting in ledger accounts for Nyame at 31 Dec 20X9.

You're reporting an error for "FA – L1 – Q38 – Accruals and prepayments"

FA – L1 – Q37 – Accruals and prepayments

Write up the insurance account for Vulcan's removal business for 20X9, including prepayments and multiple insurance payments.

You're reporting an error for "FA – L1 – Q37 – Accruals and prepayments"

FA – L1 – Q36 – Accruals and prepayments

Write up water expense ledger accounts for 20X8 and 20X9 under different payment scenarios.

You're reporting an error for "FA – L1 – Q36 – Accruals and prepayments"

FA – L1 – Q35 – Bad and doubtful debt

Write up receivables, irrecoverable debts expense, and allowance accounts for three years with specific and general allowances, including financial position extracts.

You're reporting an error for "FA – L1 – Q35 – Bad and doubtful debt"

FA – L1 – Q34 – Bad and doubtful debt

Write up irrecoverable debt expense and allowance for receivables accounts for three years with specific and general allowances.

You're reporting an error for "FA – L1 – Q34 – Bad and doubtful debt"

Our offerings

Contact Info

Customer

Get In Touch

admin