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Topic 4-Q&A
Topic 4-Q&A
The following balances were extracted from the books of Joe Wong’s business as at
1 January 2018, the first day of its financial year:
Capital $265,871
Cash $10,883
Office equipment $198,447
Trade payables $465
Bank $57,006
Required:
(a) Prepare a trial balance for Joe Wong’s business as at 1 January 2018. (6 marks)
(b) Does the trial balance agree? Briefly explain its implications. (2 marks)
Q1Answer:
(a)
Joe Wong 0.5
Trial Balance as at 1 January 2018
Dr Cr
$ $
265,87 1
Capital
1
Cash 10,883 1
Bank 57,006 1
266,33 0.5
266,336
6
Q2
Tim Chan’s business had the following balances in its books as at 31 December 2017:
Furniture $58,600
Capital $70,800
Sales $165,000
Purchases $88,300
Bank $44,100
Wages and salaries $66,500
Water and electricity $12,000
Inventory $3,000
trade creditor $36,700
Required:
Given that there is no error in the books of Tim Chan’s business, prepare a trial
balance as at 31 December 2017. (6 marks)
Q2 Answer:
Tim Chan 0.5
Trial Balance as at 31 December 2017
Dr Cr
$ $
Furniture 58,600 0.5
272,50 0.5
272,500
0
Q3
The following account balances were extracted from See Kee Co’s books as at
30 June 2018, the financial year-end date:
Trade receivables $5,080
Capital, 1 July 2017 $163,000
Sales $1,515,010
Bank $9,700
Purchases $675,100
Office equipment $300,000
Rent and rates $480,000
Salaries $144,000
Water and electricity $12,000
Inventory $52,130
Required:
Prepare the trial balance for See Kee Co as at 30 June 2018. (6 marks)
Q3
Answer:
See Kee Co 0.5
Trial Balance as at 30 June 2018
Dr Cr
$ $
Trade receivables 5,080 0.5
When Larry reviewed his son’s work, he found that some entries were located in the
wrong column. All the amounts in the trial balance are correct.
Required:
Prepare a correct trial balance and insert the balance of the capital account. (18 marks)
Q4Answer:
Larry Lee
Trial Balance as at 31 January 2008
Dr Cr
$ $
General expenses 2,990 1
Interest expense 6,440 1
Purchases 116,760 1
Returns inwards 1,540 1
Accounts receivable 53,840 1
Commission income 2,380 1
Office furniture 12,600 1
Wages and salaries 106,680 1
Sales 131,440 1
Drawings 11,760 1
Returns outwards 2,940 1
Bank overdraft 18,480 1
Accounts payable 94,550 1
Cash in hand 1,820 1
Rent and rates 7,840 1
Capital 72,480 2
322,270 322,270 1