Question
Mr Pendo commenced trading as a wholesaler stationer on 1 May 2021 with a capital of Kshs 50,000.00 with which he opened a bank account
Mr Pendo commenced trading as a wholesaler stationer on 1 May 2021 with a capital of Kshs 50,000.00 with which he opened a bank account for his business.
During May the following transactions took place.
May 1 Bought shop fittings and fixtures from store fitments Ltd for Kshs 10,000.00
May 2 Purchased goods on credit from Abel Kshs 20,650.00
May 4 Sold goods on credit to Bruce Kshs 10,700.00
May 9 Purchased goods on credit from Green Kshs 15,300.00
May 11 Sold goods on credit to Hill Kshs 9,580.00
May 13 Cash sales paid into bank account Kshs 20,200.00
May 16 Received cheque from Bruce in settlement of his account
May 17 Purchased goods on credit from Kay Kshs 15,800.00
May 18 Sold goods on credit to Nailor Kshs 12,360.00
May 19 Sent Cheque to Abel in settlement of his account
May 20 Paid rent by cheque Kshs 7,200.00
May 21 Paid delivery expenses by cheque Kshs 9850.00
May 24 Received from Hill Kshs 9,200.00 on account
May 30 Drew cheque for personal expenses Kshs 6,200.00 and assistant wages Kshs 5,320.00
May 31 Settled the account of Green.
Required
- Record the transactions in the books of prime entry. (6 Marks)
- Post the entries in the ledger accounts (6 Marks)
- Extract a trial balance as at 31 May 2021. (3 Marks)
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Principles of Accounting
Authors: Belverd E. Needles, Marian Powers and Susan V. Crosson
12th edition
978-1133603054, 113362698X, 9781285607047, 113360305X, 978-1133626985
