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a) Esinam is a trader who prepares account to 31st December each year. The following transactions with regards to Assets have taken place. i. 3rd
a) Esinam is a trader who prepares account to 31st December each year. The following transactions with regards to Assets have taken place. i. 3rd January, 2018 purchased one Plant and Machinery for GH200,000. ii. 30th June, 2019 purchased Plant and Machinery costing GH500,000 iii. 1" December, 2019 purchased Plant and Machinery for GH400,000 iv. 30th September, 2020 bought Plant and Machinery for GH600,000. Esinam maintains its Fixed Assets at cost and depreciates its Plant and Machinery at a rate 25% on straight-line basis. Depreciation is calculated on one month ownership basis. The plant and machinery purchased in January, 2018, was disposed for GH120,500 on October 1", 2020. Required: Prepare the following: i) Plant and machinery Account. (2018-2020) Provision for Depreciation Account (2018-2020) iii) Disposal account iv) Statement of Profit or loss extract (2018-2020) v) Statement of Financial Position (extract) for the year ended 31 December (2018-2020) (10 marks) Explain the following accounting concepts: i. Accrual concept ii. Business entity concept (4 marks) (Total: 14 marks)
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