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Caa 102 Intermediate Accounting I Question Paper
Caa 102 Intermediate Accounting I
Course:Bachelor Of Commerce
Institution: Kca University question papers
Exam Year:2012
1
UNIVERSITY EXAMINATIONS: 2011/2012
YEAR 1 EXAMINATION FOR THE BACHELOR OF COMMERCE
CAA 102 INTERMEDIATE ACCOUNTING I (SATURDAY)
DATE: APRIL 2012 TIME: 2 HOURS
INSTRUCTIONS: Answer ALL Questions
QUESTION ONE
The following information was extracted from the balance sheet prepared for Jasho constructors Ltd as
at 31st December 2010
Cost Accum. Depr. Net Book Value
Sh’000’ sh’000’ sh’000’
Non-current assets
Plant and Equipment 840,000 336,000 504,000
Motor vehicles 420,000 205,000 215,000
Furniture and fittings 80,000 32,000 48,000
Jasho Constractors Ltd. Charges depreciation on its non-current assets using straight line method at
the rates shown below:
Depr. Rate per Annum
Plant and equipment 10%
Motor vehicles 20%
Furniture and fittings 10%
A full year’s depreciation in the year of purchase and no charge in the year of disposal.
Additional Information for the year ended 31 st December 2011
1. The following non-current assets were disposed of during the year.
2
Cost Acc. Depr Disposal proceeds
Sh.’000’ Sh.’000’ Sh.’000’
Equipment 285,000 228,000 47,500
Motor vehicles 112,000 84,000 26,400
Furniture and fittings 26,000 9,750 12,300
2. The Company purchased four new motor vehicles by trading-in four boarded motor vehicles at an
agreed value of sh. 38,000,000. The company made additional payment by cheque of sh.
56,000,000 in settlement of the cost of the new motor vehicles. The boarded motor vehicles had a
cost of sh. 86,000,000 on 15th September 2008.
3. The company also imported an item of equipment of equipment during the year. The cost of
acquisition of the item is shown below:
Sh’000’
Purchase price 110,000
Freight 20,275
Customs duty 54,350
Insurance in – transit 14,175
Required
Prepare;
Non- current assets movement schedule for the year ended 31st December 2011 (18 Marks)
QUESTION TWO
The following data relates to ABC Co. Ltd
2008 2009 2010 2011
Sh.’000’ sh.’000’ sh.’000’ sh.’000’
Debtor’s balance b/d 600 ? ? ?
Credit Sales 34,900 54,000 62,000 74,800
Cheques from debtors 30,000 48,000 56,000 61,000
Bad debts to be written off 364 323 290 400
Bad debts recovered - 240 290 170
Return inwards 32 40 24 25
Provision for bad debts 224 2% 4% 3%
Required:
3
(a) Total debtors account
(b) Bad debts account
(c) Bad debts recovered account
(d) Provision for bad debts account
(e) A statement of financial position (extract) (16 Marks)
QUESTION THREE
(a) Explain the business activities that affect the cash flows in a business firm (3 Marks).
(b) The bank columns in the cash book for March 2012 and the bank statements for that month as
follows for Jessy Traders
Dr. Cash Book Cr.
2012 March sh’000 sh.’000’
1 Balance b/d 2,820 March 7 Melon 360
7 June 134 10 Ruth 1,308
18 Kariuki 480 24 lily 900
24 B. lee 640 30 Ken 600
30 Jeremy 3,500 30 Balance b/d 4,406
7,574 7,574
Bank statement
Dr. Cr. Balance
Sh.’000’ sh.’000’ sh.’000’
March 1 Balance b/d 2,820
8 Cheque 134 2,954
9 Melon 360 2,594
12. Cheque 600 3,194
20. Kariuki 480 3,674
26. Bank charges 4 3,670
28. Standing Oder 120 3,550
30 Dividends 350 3,900
31. Cheque 1,308 2,592
31. Credit transfer 1,288 3,880
4
Required:
(a) Adjusted cashbook (5 Marks)
(b) A bank reconciliation statement. (4 Marks)
(c) Explain an imprest system (2 Marks)
QUESTION FOUR
(a) Explain how the following are recognized and presented in the financial statements;
i) Assets
ii) Revenue
iii) Expenses (6 Marks)
(b) Banita construction Co. Ltd won a contract for the construction of a multi-story building at a cost
of sh. 400 Million. The data relating to the contract for the year ended 31st December 2011 were as
follows:
shs.’000’
Material issued to the site 160,000
Material purchases locally 31,400
Direct wages: paid 11,600
Accrued 700
Plant purchased and installed 97,600
Direct expenditure: Paid 3,560
Accrued 140
Established charges 360
Material returned to store 1,700
Work certified 300,000
Material on site December 31st 2011 10,660
Cost of work not certified 7,800
Value of plant on December 31st 2011 83,000
The client had received from client, payments amounting sh. 252 Million
Required;
i) Prepare the contract account (5 Marks)
ii) Prepare the contractee account (4 Marks)
iii) Show how the various items will appear in the balance sheet as at 31st December 2011
(3 Marks)
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