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Acct 423: Accounting For Public Agencies Question Paper

Acct 423: Accounting For Public Agencies

Course:Bachelor Of Commerce

Institution: Kabarak University question papers

Exam Year:2010

KABARAK UNIVERSITY

UNIVERSITY EXAMINATIONS
2009/2010 ACADEMIC YEAR
FOR THE DEGREE OF BACHELOR OF
COMMERCE
COURSE CODE: ACCT 423
COURSE TITLE: ACCOUNTING FOR
PUBLIC AGENCIES

STREAM: Y4S2

DAY: THURSDAY

TIME: 2:00 – 4:00 P.M.

DATE: 25/03/2010

INSTRUCTIONS:
1. Answer Question ONE (COMPULSORY) and any other two Questions

QUESTION ONE
a) You are stationed at Mlima District Treasury for which the authorized imprest is Sh. 15,000.
The following transactions took place during the first two weeks of December 2006:

2006-December

2 - Opening balances; cash, Sh. 3,095 and bank, Sh. 11,905
2 - Received Sh. 615 (cheques) in respect of Motor Vehicle Licences
2 - Paid telephone account (cheque No. 11) – Sh. 75
3 - Paid James Kariuki – Sh. 65 (cash) in settlement of claim for traveling
expenses.
3 - Received cash in respect of trade licences – Sh. 300
3 - Received cash in respect of cattle traders licences Sh. 65
4 - Settled electricity account – Sh. 153 (cheque No. 12)
4 - Sh. 200 (cheque) received for cattle traders licence from A.B.C. Kago.
4 - Paid Kamau Bros. Sh. 96 (cheque No. 13) for uniforms.
5 - Cheques for Sh. 500 received in respect of liquor licences.
5 - Collected from Maendeleo Cinema Sh. 210 (cheque) for entertainment tax
5 - Paid to Mlima Garage – Sh. 2,300 (cheque No. 14) for repairs to G. K.
lorry.
6 - Keep cash balance of Sh. 1,000; bank the rest of the cash together with all
Cheques on hand and rule off the cash book.
9 - Paid to Maridadi Stores for rations – Sh. 269 (cheque No 15)
9 - Received from Chief Accountant a cheque for Sh. 799 which was banked
Immediately.
10 - Received Sh. 55 in cash for Game licences
10 - Sh. 6,300 cash brought in by revenue clerk in respect of trade licences
10 - Surplus cash found Sh. 15
11 - Paid A. Khaduli, house allowance – Sh. 165 (cheque 16).
11 - Received a cheque for Sh. 195 from Maendeleo Cinema in respect of
Entertainment tax
11 - A cheque for Sh. 200 received from John Onyango for a liquor licence.
11 - A. Odera paid Sh. 52 by cheque for publications purchased.
11 - Paid wages – Sh. 900 to Mr. A. Kinuthia in cash
13 - Paid in Cash mileage claims for various officers – Sh. 1,950.
13 - Keep cash balance of Sh. 1,500 and bank the rest of the cash and all
cheques.
13 - Remit a cheque to the Chief Accountant for the amount in excess of the
Authorized imprest and then rule off the cash book.

Required:

Record the above transactions in the book taking the appropriate action as indicated. (15 marks)

b) The following balances were extracted from the books of Widows and Orphans Fund for the
year ended 30 April 2000:

Sh.
Payments to widows and orphans
Refund to bachelors
Management expenses
Members contributions
Interest on investments
Provision for exchange losses on foreign investments (30 April
1999)
Investment account
Employers contributions
Fund account 30 April 1999
2,910,000
150,000
70,000
2,012,000
6,000,000
2,000,000
80,000,000
40,000
76,000,000

Sh.
Cash
J.M. Fund
C.S.F. Corporation
P.M.G

1,000,000
1,600,000
322,000

2,922,000

The following information is also available:

1. A sum of Sh.80,000 was due to be paid to Widows and Orphans, but claims were not
received until May 2000.
2. Interest on investments amounting to Sh.800,000 was to be paid to the fund in March
2000, but the cheque was not received until May the same year.
3. The employer contributions for the year should not be less than 3% of the total members
contribution for the year.
4. Thirty members of the Fund were late in paying the contribution for the year ended 30
April 2000 amounting to Sh.3,000 each.
5. Provision in case of loss on foreign investments should be adjusted to Sh.1,600,000

Required:
(a) A trial balance of the Fund after taking all the above adjustments into account.
(6 marks)
(b) Income and expenditure account for the year ended 30 April 2000. (6 marks)
(c) A balance sheet as at 30 April 2000. (3 marks)
(Total: 30 marks)

QUESTION TWO
a) Briefly explain any four characteristics that distinguish governmental organisations from
other business organisations. (8 marks)

b) With reference to public sector accounting, briefly explain the following terms:

i) General fund. (2 marks)
ii) Annual estimates (2 marks)
iii) Excess vote (2 marks)
iv) Encumbrance (2 marks)
v) Vote on account (2 marks)
vi) Exchequer over issues (2 marks)
(Total: 20 marks)

QUESTION THREE
The approved Estimates and Actual Expenditure details for vote E45 of ministry ABC for the
financial year 2004/2005 were as follows:
Approved Actual
Estimates Expenditure
Sh.''000'' Sh.''000''
000 Personal Emoluments 246,560 195,040
50 House allowances 39,100 28,520
80 Passages and Leave Expenses 8,280 1,334
100 Transport Operating Expenses 32,200 27,186
110 Travelling and Accommodation Expenses 2,668 3,312
120 Postal and Telegram Expenses 9,200 6,624
190 Miscellaneous other Charges 34,960 33,764
196 Training Expenses 11,960 13,476
230 Purchase of Equipment 42,000 17,600
620 Appropriations - in -Aid 2,000 11,120 (Realised)

The Ministry made four equal withdraws from the Exchequer in July 2004, October 2004,
January 2005 and May 2005. In total the Ministry had withdrawn Sh.400, 000,000 by the end of
the 2004/2005 financial year.
Supplementary estimates authorised during the year were as follows:

Sh.''000''
000 Personal Emoluments 12,000 (reduction)
196 Training Expenses 2,000 (increase)
620 Appropriations -In-Aid 8,000 (increase)

Required:
a) Appropriation account for the year ended 30 June 2005 (6 marks)

b) General Account of vote for the year ended 30 June 2005. (4 marks)

c) Exchequer Account for the year ended 30 June 2005 (4 marks)

d) Paymaster General (PMG) account for the year ended 30 June 2005. (2 marks)

e) Statement of assets and liabilities as at 30 June 2005. (4 marks)
(Total: 20 marks)

QUESTION FOUR
In relation to Government Accounting explain briefly what is meant by the following
terminologies:

(a) Controller and Auditor General: (3 marks)
(b) Sinking fund: (3 marks)
(c) Trust fund: (3 marks)
(d) Revolving fund (3marks)
(e) Public Accounts Committee. (2marks)
(f) Consolidated fund. (2 marks)
(g) Appropriations-in-aid. (2 marks)
(h) Paymaster General. (2 marks)
(Total: 20 marks)

Acct 423: Accounting For Public Agencies Question Paper

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