Accounts from Incomplete Records

1. How should a loss of stock by theft be recorded?

Debit Credit
(A) Trading account Profit and loss account
(B) Profit and loss account Trading account
(C) Trading account Stock account
(D) Stock account Trading account

2. At 1 April 2000 Tonkins business assets were Motor van valued at $5,000 (cost $8,000), tools
$1,600, stock $700, debtors $168, cash $400 and his creditors totaled $1,120.
At 31 March 2001 his assets were: Workshop which had cost $20,000 and on which a mortgage of $16,000
was still outstanding, motor van $4,000, tools $1,900, stock $1,000, debtors $240 (of which $70 were known
to be bad), cash $500. His creditors amounted to $800. During the year Tonkins drawings amounted to
$5,200.
His profit for the year was

(A) $6,222
(B) $6,292
(C) $9,222
(D) $9,292

3. At 1 March 2000 Allens debtors amounted to $12,100. In the year to 28 February 2001 he received $63,500
from debtors and allowed them settlements discounts of $3,426.
At 28 February 2001 his debtors totaled $14,625.
Allens sales for the year were

(A) $62,599
(B) $64,401
(C) $66,125
(D) $69,451

4. Orange limited had an opening capital of $11,260 in the year 2000. Profit after all expenses had been paid
was $64 for the year. During the year, an amount of $20 was withdrawn.
The companys closing capital for 2000 was

(A) $11,280
(B) $11,304
(C) $11,324
(D) $11,344
5. The XYZ Company has taken out a fire policy for $10,000 covering its stock-in-trade. A fire occurs on 30
September and stock was destroyed with the exception of $2,000 worth. No records could be saved but the
following is known.

$
Opening Stock 1 July 1990 12,000
Purchases to-date of fire 14,000
Sales to-date of fire 24,000
Average Gross Profit on sales 25%

The amount of claim XYZ Company can make to the insurance company is

(A) $2,000
(B) $6,000
(C) $8,000
(D) $10,000

6. Given opening debtors $1,628, cash from debtors $8,162, discount allowed $315, bad debts $420, closing
debtors $1,860 , credit sales would be

(A) $1,860
(B) $8,162
(C) $9,129
(D) $10,757

7. Jackson commenced business with $10,000 he had received as a gift from his aunt and $8,000 he had
received as a loan from his father. He used some of this money to purchase a machine for $15,000. He
obtained a mortgage for $20,000 to purchase a workshop.
Jacksons capital was

(A) $3,000
(B) $10,000
(C) $18,000
(D) $38,000

8. If the mark up were 25%, the margin as a percentage of sales prices would be

(A) 17%
(B) 20%
(C) 25%
(D) 33%

9. A business sells good earning a constant 25% mark up. Sales in the period amounted to $500,000. Opening
stock was $10,000, closing stock was valued at $20,000.Purchases were $450,000. The owner suspects
theft.
Calculate the amount of the stock losses.

(A) $40,000
(B) $50,000
(C) $60,000
(D) $65,000
10. At 1 January 2001 Roberts business assets were valued at $36,000 and his liabilities amounted to $2,400.
At 31 December 2001, Roberts assets amounted to $57,000 and included his private car which he had
brought into the business on 1 November when it was valued at $9,000. His creditors at 31 December
totaled $17,000 and his drawings during the year were $27,000.
Roberts profit for the year to 31 December 2001 was

(A) $6,400
(B) $24,400
(C) $33,400
(D) $58,000

11. A business has the following cash and bank transactions during September 2001.

$
Balance at 01-09-2001 Cash 500
Bank (overdraft) 1,000
Receipts of cash 12,600
Cash paid 3,200

$
Cash paid into bank 8,500
Cash withdrawn from bank for official use 3,000
Payments by Cheque 8,200
Balances at 30-9-2001 Cash 600
Bank (overdraft) 6,200
Calculate total cash and bank drawings

(A) $860
(B) $6,300
(C) $9,300
(D) $1,800

12. Marigold Company had an increase in total assets of $48,000 and a decrease in total liabilities of $6,000
during the year 1984. The owner made no additional capital contribution but withdrew $6,000 during the
year.
Marigold net profit for 1984 was

(A) $42,000
(B) $48,000
(C) $54,000
(D) $60,000

13. On the morning of 10 October 1985, a fire destroyed the entire merchandise inventory of a super Store. The
inventory was uninsured.

The following date are available: $

Sales, 1 January 1985 to 9 October 1985 720,000

Inventory 1 Jan 1985 100,000
Purchases, 1 June 1985 to 9 October 1985 630,000
Mark-up on cost 20%

The estimated loss is

(A) $20,000
(B) $30,000
(C) $130,000
(D) $144,000
14. A business makes sales with a gross profit margin of 30%. At 1ST April 1997, the stock was valued at $2,600
and at 31 March 1998 at $3,800. During the year the sales totaled $80,800.
What was the value of purchases during the year?

(A) $56,560
(B) $57,760
(C) $60,360
(D) $63,354

15. A new business was established with opening capital of $15,000. At the end of the year net assets were
$20,000. During the year proprietors drawings were $3,000 and this resulted in an overdraft at the end of
the year of $3,000.
What was the profit during the year?

(A) $2,000
(B) $3,000
(C) $5,000
(D) $8,000

16. The tables shows transactions relating to a commodity during a period.

Units Value
$
Purchased 50 $4
Sold 30 $10

Of the remaining units, 8 are damaged and therefore worthless.

What is the profit for the period?

(A) $68
(B) $100
(C) $148
(D) $180

17. A company purchases a product that costs $240. The company expects to make a gross profit margin of
3312 %.
What is the companys mark-up?

(A) $60
(B) $80
(C) $100
(D) $120

18. A company sells goods on sale or return at a markup of 25%.

At the Balance sheet date the following information is available.
Goods in warehouse $300,000 (cost)
Goods sent on sale or return $200,000 (at invoice price)

What will be the value of closing stock in the company accounts?

(A) $300,000
(B) $450,000
(C) $460,000
(D) $500,000
19. The table shows the following balances for a business.
Start of year End of year
$ $
Stock 6,000 9,000
Trade creditors 8,000 10,000

Total payments to trade creditors were $20,000.

What is the cost of sales for the year?

(A) $15,000
(B) $19,000
(C) $21,000
(D) $25,000

20. The bookkeeper of a company has disappeared. There is no cash in till and theft is suspected.
The following information is known

$
Cash balance at beginning of period 750
Total sales during the period 150,000
Decrease in debtors during the period 5,500
Receipts from debtors paid into bank 96,000
Expenses paid from cash received 5,000

How much cash has the bookkeeper stolen during the period?

(A) $44,250
(B) $49,750
(C) $55,250
(D) $60,250

21. On 6 January 2002 a firm lost all its stock in a fire. Stock had a Balance Sheet valuation of $650,000 on
31 December 2001.
In the period 1-5 January 2002 purchases were $75,000 and sales were $96,000.
The average gross profit the firm makes is 25% of selling price.
What was the value of stock on 5 January?

(A) $629,000
(B) $647,000
(C) $653,000
(D) $671,000

22. The table shows information relating to the fixed assets of a business.
$
Net book value at the beginning of year 28,000
Net book value at end of year 25,000
Depreciation charge for the year 4,000
Disposals at net book value 9,000

What is the figure for fixed asset additions?

(A) $2,000
(B) $6,000
(C) $10,000
 (D) $16,000

23. A business owner suspects a loss of cash has occurred, he provides the data shown.
$
Cash balance at the start of the month 150
Cash balance at the end of the month 100
Cash banked 10,200
Cash sales per till rolls 10,500

How much cash has been lost?

(A) $200
(B) $250
(C) $300
(D) $350

24. You are given the following information on 31 December 2003 by X a sole trader.
$
Total purchases for year 95,000
Returns inwards 3,000
Returns outwards 2,000
Stock withdrawn by X for personal use 5,000

Unsold stock on 31 December 2003 was valued at $1 000 more than on 1 January 2003.
What is the cost of sales?

(A) $86,000
(B) $87,000
(C) $89,000
(D) $97,000

25. How may net profit be calculated?

(A) Closing Capital + Drawings Additional Capital Opening Capital

(B) Closing Capital Drawings + Additional Capital Opening Capital
(C) Opening Capital + Drawings Additional Capital Closing Capital
(D) Opening Capital Drawings Additional Capital Closing Capital

26. A business does not keep proper accounting records.

The following information is available at the start of the year.
1. A motor car valued at $2,500
2. Stocks which cost $4,000 with a sale value of $6,000
3. Bank overdraft of $500
4. A loan to a friend from the business bank account $1,000

What is the Capital account balance at the start of the year?

(A) $5,000
(B) $7,000
(C) $8,000
(D) $9,000