SECTION II $-$ Short Answers

Noble is a private company and has a fiscal year end of $31$ December $2011.$ During the year $2011$ Noble has paid sponsorship fee of AED. $200,000$ for the period covering from $1$ July $2011-30$ June $2012.$ He is not an accountant and therefore has requested you to propose a journal entry to be recorded as at $31$ December $2011$ and the subsequent journal entry for this transaction to be recorded during the year $2012?$

ABC Company purchased machinery amounting to AED. $20,000$ on $1$ January $2012$ through cash. The machine is being depreciated over $3$ years. On $30$ June $2013$ the management of ABC Company sold the machine for AED. $7,000.$ Write down the journal entries for the below:

Purchase of the machinery

Depreciation charge

Disposal of the machine and the corresponding gain or loss on disposal as at $30$ June $2013.$

Prepare a Bank Reconciliation Statement based on the below:

The cash book of J$.$Jones showed a balance at the bank of $$570$ in hand on $31$ January $1991.$ At the same date, the bank statement balance of J$.$Jones' account was $$446$ overdrawn. The difference accounted for as follows:

Cheques for $$1,555$ sent to creditors on $30$ January were not paid by the bank until $8$ February.

Cheques amounting to $$2,520$ paid into the bank on $31$ January were not credited by the bank $1$ Fberuary.

A standing order for a charitable subscription of $$60$ had been paid by the bank on $21$ January no entry had been made in the cash book.

A cheque paid by J$.$Jones for rent on $15$ Janury for $$345$ had been entered in his vash book as $$354.$

$4.$ Correction of Errors in the Trial Balance

Michael is a business man who is inecperienced in accounting. He has prepared the following trial balance as at $31$ December $2011$ for his Company XYZ LLC:

$\backslash$table$[[$Description$,$Debit,Credit$],[$Revenue$,100,000,],[$Advertising expenses,$20,000,],[$Sales returned by the customer,,$15,000],[$Trade receivable,$100,000,20,000],[$Trade payable,,$],[$Fixed assets,$25,000,],[$Accumulated depreciation,$10,000,],[$Discount received,$200,000,70,000],[$Discount allowed,,$]]$

What are the errors you identified in the above trial balance?

$4/$Page