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Knec Principles Of Accounts October/November 2015 Question Paper

Knec Principles Of Accounts October/November 2015

Course:Diploma In Food And Beverage Management

Exam Year:2015

PRINCIPLES OF ACCOUNTS
Oct./Nov.2015
Time:3 hours

THE KENYA NATIONAL EXAMINATIONS COUNCIL
DIPLOMA IN FOOD AND BEVERAGE MANAGEMENT
PRINCIPLES OF ACCOUNTS
3 hours
INSTRUCTIONS TO CANDIDATES
This paper consists of EIGHT questions
Answer any FIVE questions in the space provided in this paper.
All questions carry equal marks.

This paper consists of 20 printed pages.
Candidates should check the question paper to ascertain that all the
Pages are printed as indicated and that no questions are missing.

1. (a) The following transaction relate to Malo Hotel for the month of November 2012.

November 1: Bought furniture on credit from Onyango furniture Ksh.25,200.
5: Malo took goods worth Ksh 7,000 for personal use.
7: A credit purchase of Ksh 100,000 from Jujii Traders was completely
Omitted from the books
28: A purchase of office equipment for Ksh.60,000 was recorded in repairs
account.
29: Goods lost by fire on Malo hotel were Ksh 40,000.
Prepare a general journal to record the above transactions.erial MT 40 of Dimaz Hotel Ltd for the month of July 2012.
---------Receipts-------Issues
July 1----200 units @Ksh 20---July 2 100---units
July 7----1000 units @ Ksh 23-----July 8---700 units
July 15---1500 units @Ksh 25-------July 21---500 units
July 17----800 units @Ksh 28------July 24---800 units
July 22-----400 units @Ksh 30
Prepare a stores ledger account using First In First Out (FIFO) method. (10 marks)

(b) The following transaction relate to mat
(10 marks)
2. (a) Explain each of the following terms as used in accounting

(i) Capital reserves
(ii) Revenue reserves
(iii) Provision for bad debts
(iv) Provision for depreciation.
(8 marks)
(b) The following information relate to Hossana Hotels for the month of May 2012.

May 1: cash in hand Ksh 115,500
Cash in Bank Ksh 2,380,400
4: Received a cheque of Ksh 238,700 from Kungu
9: Bought furniture Ksh 207,900 by cheque
10: Withdrew Ksh 27,500 form bank for business use
14: Paid motor expenses Ksh 62,700 by cheque
17: Received Ksh 220,00 cash from Demo
22: Paid salaries in cash Ksh 262,900
31: Receive a cheque of Ksh 7,920 from Rhoda
Prepare a two column cash book.
(12 marks)
3. (a) Explain four reasons why hotel should maintain paper books of accounts
(8 marks)
(b) Ali and Babu partnership business. Their partnership deed provides for the following:
(i) Profit and losses to be shared between Ali and Babu in the ratio 3 : 2 respectively.
(ii) Babu to receive a salary of Ksh 140,000 per annum.
(iii) Interest on drawing to be charge at 15% p.a.

The following balances relate to the firm as at 30 April 2012.
-------------sh
Capital
Ali----------1,560,000
Babu---------1,000,000
Drawings
Ali----------40,000
Babu--------30,000
Creditors-----500,000
Net profit---------2,000,000
10 year loan------1,000,000
Debtors---------2,520,000
Bank overdraft--------200,000
Current A/C Ali---------200,000
Babu-----------130,000
Buildings (NBV)---------4,000,000

Prepare
(i) Profit and loss and appropriation account for the year ended 30 April 2013.
(ii) Partners current account
(iii) Balance sheet as at 30 April 2011
(12 marks)
4. (a) High class hotel maintains a petty cash book on an imprest system with a cash float of Ksh 40,000.The float is reimbursed at the beginning of the month .The balance brought forward as at 1 February 2013 was Ksh 2,000.

February 2 photocopy papers----------2,200
5 Bus fare-------4,000
17 Airtime----------4,000
21 Cleaning---------2,700
25 Cooking gas------8,000
Prepare a petty cash book using the following analysis columns
Stationery
Travelling
Telephone
Gas
Cleaning
(10 marks)

(b) The following information was extracted from the books of Hela Ltd.
Debtors balance as at 31 December
2010----------Ksh 1,560,000
2011----------Ksh 1,040,000
2012---------Ksh 1,200,000
The company maintains a provision for bad debts at 5% of the closing balance.
The provision for bad and doubtful debts as at 1 January 2010 was Ksh 150,000.
For each of the year ended 31 December, 2010, 2011 and 2012 prepare
(i) Provision for bad debts account
(ii) Balance sheet extract.
(10 marks)
5. (a) Explain four causes of depreciated of noncurrent assets.
(8 marks)
The following information was extracted from the books of Manu,a sole trader for the year ended 31 December 2012.
---------------Ksh
Sales----------14,000,000
Purchase-------9,850,000
Rent and Rates-------40,000
Motor vehicles expense-----145,600
Bad debts---------54,000
General expenses--------12,900
Salaries and wages-------1,200,000
Depreciation-----------115,000
Stock – January 2012------100,000

Additional information
As at 31 December 2012
--------------------Ksh
Stock was valued at----250,000
Salaries and wages accrued----40,000
Prepaid rent and rates-----36,000

Prepare:
Trading and profit and loss account for the year ended 31 December 2012.

6. (a) The following balances were extracted from the books of Latema social Club.
-----------------------31 December 2011-----------------31 December 2012
-------------------Ksh------------------------------Ksh
Subscription owing---24,000-----------------------36,000
Subscription received in advance-80,000----------60,000
Sport equipment-----------------50,000----------60,000
Canteen stock-------------------145,000-------------150,000
Bank--------------------------47,000------------53,000
Club land------------------80,000-------------100,000

During the year ended 31 December 2012 subscription received amounted to Ksh. 240,000.

(i) Prepare the subscriptions account for the year ended 31 December 2012
(ii) Determine the accumulated fund as at 31 December 2012.
(12 marks)
(b) The following transaction relate to Wanga traders for the month of July 2012.

2012
July 1: Purchase goods on credit from Munga Millers Ksh 300,000.
6: sold on credit to EPLZ ltd Ksh 4,000,000
7: Purchased goods on credit from Dilmalex Ltd Ksh 1,500,000
And Ksh 2,100,000 from Kamari
22: Sold goods on credit to Hemaya Sh 150,000 Lida Ksh 250,000
And Mwambale Ksh 275,000
28: Purchased goods from Msafiri traders Ksh 2,000,000 on credit.

Prepare
(i) Purchase Journal
(ii) Sales Journal
(8 marks)
7. (a) Explain use of the following document in a business.

(i) Requisition note
(ii) Delivery note
(iii) Invoice
(iv) Credit note
(8 marks)
(b) The following trial balance was extracted from books of ABC Hotel as at 31 October 2012.
--------------------------DR----------------------CR
Sales---------------4,000,000
Purchases-------------------------------------3,800,000
Debtors--------------------------------------200,000
Capital------------2,000,000
Building-------------------------------------1,850,000
Furniture-----------------------------------50,000
Bank overdraft------------------------------270,000
Running expenses------140,000
Opening stock------------------------------14,000
Closing stock---------47,800
Creditors-----------37,200
Drawing------------------------------------15,000
Suspense----------------------------------26,000
-------------------6,225,000--------------6,225,000
Prepare the corrected trial balance as at 31 October, 2012.
(12 marks)

8. (a) Classify each of the following items as non- current assets, current assets, long term liabilities or current liabilities.
(i) Trade creditors
(ii) Cash at bank
(iii) Trade debtors
(iv) Building
(v) Accrued electricity
(vi) Equipment
(vii) Outstanding salaries
(viii) Loan from AKCB 5 years.
(8 marks)
(b) The following transactions relates to Wema enterprise for the month of March 2013.

March 1: Started business with Ksh 1,000,000 in the bank.
3: Bought goods on credit from Max Dealers Ksh 80,000
4: Cash sales Ksh 4,500
11: Paid electricity by cheque Ksh 4,000
16: Sold goods on credit to Wagu Retailers Ksh 20,000
23: Bought shop fitting by cheque Ksh 80,000
24: Paid Max dealers by Cheque less 5% cash discount
31: Received Ksh100,000 by cash as loan from Zaidi bank.
Enter the above transactions in the ledger accounts of Wema enterprises.
(12 marks)

Knec Principles Of Accounts October/November 2015 Question Paper

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