The Islamic University of Gaza

Faculty of Commerce

Accounting Department

Accounting Principles (1)

Final Exam, First Semester 2015/2016

Time Allowed: TWO hours

Student Name …………………………………………………….

Student No. ..………………………………………………….

Prof. Salem A Helles

26 Dec. 2015

Answer the Following Questions:-

Question One: 20 Mark

You are to show the Journal entries necessary to record the following transactions which occurred in the books of S. Yousf for the month of May.

May / 1 / Goods bought on credit from: A. Abdalla £500 and S. Ali £700.
3 / Goods sold on credit to E. Emad £800.
4
6 / Paid for motor expenses in cash £60.
Goods returned to us by E. Emad £100.
10 / Bought a van on credit from ABC Motors Ltd £4,500
17 / Goods returned by us to S. Ali £50.
18 / Salaries paid by cheque £740.
19 / Paid ABC Motors Ltd a cheque for £4,500.
20 / H. Hamdy owes us £640. He is unable to pay his debt. We agree to take some computer equipment from him at that value and so cancel the debt.
21 / A debt of £150 owing to us from A. Saed was written off as a bad debt.
21 / Sale of van no longer required for £2500 on credit to S. Hany.
22 / K. Ali, a debtor, owed £3500. He was unable to pay his account, but offers a Machine in full settlement of the debit. The offer is accepted.
23 / Office furniture bought by us for £1600 was returned to Al-fanea Ltd, as it was unsuitable. Full allowance will be given to us.
24 / We are owed £750 by R. Hindy. He is declared bankrupt and we received £250 cash in full settlement of the debt.
25 / We take goods costing £120 out of the business inventory without paying for them.
26 / Put £900 of the cash into a bank account.
27 / F. Swafery lent us £1500, paid by cheque.
28
30
31 / Sold goods to M. Mslm For £300 without taking cash or cheque, but simply Mslm signs a credit card voucher.
E. Emad paid us his account by cheque, less 5% cash discount.
Paid S. Ali by cheque £650.

Question Two: 20 Mark

The following is the trial balance of T. Kamel as at 31 Dec. 2014. You are required to prepare the Income Statement for the year ended 31 December 2014 and the Statement of Financial Position as at that date.

Dr / Cr
£ / £
Inventory: 1 Jan 2014 / 52,800
Sales / 276,400
Purchases / 141,300
Carriage inwards / 350
Carriage outwards / 5,840
Returns outwards / 400
Wages and Salaries / 63,400
Rent / 3,800
Communication expenses / 1,400
Commissions paid / 1,930
Insurance / 1,830
Sundry expenses / 210
Buildings / 125,000
Accounts receivable / 45,900
Accounts payable / 24,800
Fixtures / 1,100
Cash at bank / 31,420
Cash in hand / 270
Drawings / 35,320
Capital / 200,000
Returns inwards / 230
Long-term loan / 10,000
Discount Received
Totals / 512,000 / 500
512,000

Inventory at 31 December 2014 was £58,440.

Question Three: Answer this Question on the Exam Paper (20 Mark).

A)  New Look Company uses special journals ( Cash Journal, Sales Journal, Purchases Journal) and a General Journal. Identify the journal in which each of the following transactions is recorded.

(a)  Cash sales. ______

(b) Owner withdrawal of cash. ______

(c)  Sold goods on account. ______

(d) Receipt of cash for goods sold. ______

(e)  Purchase supplies on account. ______

(f)  Cash sale of equipment. ______

(g)  Credit sales. ______

(h) Purchase of goods on credit. ______

(i)  Opening entries ______

(j)  Bought fixtures on credit. ______

(k)  Paid motor expenses by cheque. ______

(l)  A debt owing to us by P. Adel is

written off as bad debt. ______

(m) Correction of errors. ______

(n) Purchase of goods by cheque. ______

B)  When the terms of payment 5/10, n/30 appear on an invoice, it

means that:______

C)  Choose the correct answer

1)  The Sales Ledger is the book in which

a.  All daily sales, cash or on credit, are recorded.

b.  Cash sales only are recorded.

c.  Credit sales only are recorded.

d.  Customers accounts are kept.

2)  The Purchases Journal is the book where

a.  All purchases, cash or on credit, are recorded.

b.  All credit purchases are recorded.

c.  Cash purchases only are recorded.

d.  Suppliers accounts are kept.

3)  The Sales Day Book is the book where

a.  All credit sales are recorded.

b.  All sales, cash or on credit, are recorded.

c.  Cash sales only are recorded.

d.  Customers accounts are kept.

4)  The Purchases Ledger is the book in which

a.  Suppliers accounts are kept.

b.  All daily purchases, cash or on account, are recorded.

c.  Credit purchases only are recorded.

d.  Cash purchases only are recorded

Good Luck

3