Description

BOOKKEEPING AND ACCOUNTING

OLTFSTION ONE

• Briefly describe the following documents commonly used in business transactions.
  • Purchase credit note
  • Credit note
  • Debit note

{6 marks}

(ii)       Miss Wambua, a motor car dealer, had the following transactions in the month of August:

August 1	Bought a car from K. Omari and paid for it by cheque	Ksh.204,OOO
3	Sold a car on credit to Mr. Kiprono	Ksh.252,OOO
10	Bought office typewriter from Okalo	Ksh.9,OOO
20	Sold a car to a Marenya on credit	Ksh.240,500
21	Bought a car from Wangwe on credit	Ksh.212,500
21	Sold a car to Lena Laboso and received spot cash	Ksh.297,500
31	Bought additional machine from Mukuna on credit	Ksh.11,200

Required:

Assist Miss Wambua with relevant entries in the subsidiary books and post them to cash book balance.

{6 marks}

• (i) Explain FOUR main causes of differences between the bank balance and the cash book balance.

{4marks} (ii) What are the main benefits of maintaining control accounts.

{3marks}

• Some book-keeping errors are said to affect the agreement of a trial balance while others do not. Explain THREE main examples of each.

{6 marks}

BOOKKEEPING AND ACCOUNTING 11-1-2