LIVINGSTONE CAMPUS

BACHELOR OF ACCOUNTING AND FINANCE

MODE OF STUDY: PART TIME & DISTANCE
BOAF 1060 – FINANCIAL ACCOUNTING

ASSIGNMENT ONE FOR JUNE EXAMS 2024 – 10%

Lecturer: Mr. G. Mwanza

INSTRUCTIONS
1. Enter your student number and your National Registration Card number on the front of the
cover page.
2. Font type: Times New Roman
3. Font size: 12pts, 1.5-line spacing
4. Submission due date: Wednesday, 13th March, 2024, by 17:00 hours CAT
5. Submit the assignment in Moodle only and in word format.
6. The marks shown against the requirement(s) for each question should be taken as an indication
of the expected length and depth of the answer.
7. Present legible and tidy work.
8. Total marks 100 to be converted to 10
9. Answer All questions
QUESTION ONE

You have been provided with the following list of balances of Bwezani Limited from which

you are required to extract a trial balance as at 31 March 2021:

K’000

Share capital 413

Employee salary 375

Interest received 520

10% debenture 450

Revaluation reserves 285

Purchase 810

Sales 1,335

Returns outwards 90

Returns inward 128

Carriage inwards 180

Carriage outwards 300

Rent receivable 45

General reserves 315

Bank loan 1,365

Payables control 900

Receivables control 1,275

Computers 2,100

Drawings 405
Bills receivable 625

Bills payable 480

Required:

a) Prepare the trial balance using information provided above. (10 marks)
b) Define Double entry accounting system and explain three (3) disadvantages of double entry
system and two (2) advantages of double entry system. (10 marks)

[Total: 20 Marks]

QUESTION TWO

Write brief notes on the following;

i. Limited Liability (4 marks)

ii. Debentures (4 marks)
iii. Ordinary Share Capital (4 marks)
iv. Preference Share Capital (4 marks)
v. Share Premium (4 marks)

[Total: 20 Marks]
QUESTION THREE

George a retail trader has a very limited accounting knowledge. In the absence of his accounting
clerk employee, he extracted the following trial balance as at 31st march 2023 from his business
accounting records:

Dr Cr

K K

Inventory April 2022 107,000

Discount allowed 3,100

Discount received 4,500

Purchases 940,000

Commission received 9,600

Returns inwards 11,000

Returns outwards 14,000

Sales 1,321,000

Property 700,000

10% Bank loan 80,000

Motor Vehicles 150,000

Capital 846,000

Cash at Bank 71,000

Receivables 113,000

Payables 76,000

Bad debts 20,000

Electricity 16,000
Salaries and Wages 130,000

Drawings 90,000

Inventory - March 31st 2023 78,000

2,390,100 2,390,100

Required;

a) Prepare a corrected Trial Balance by using the above details. (5 marks)

Additional Information

i. Wages and salaries amounting to K50,000 were owing

ii. Prepaid electricity amounted to K8,000
iii. Provide for 5% as provision for bad debts on receivables
iv. Property and Motor vehicles are to be depreciated at 10%per annum 20% per annum
all on cost respectively.
b) Prepare a Statement of income for the year ended 31st March 2023 as well as a Statement of
Financial Position as at that date. (15 Marks)

[Total: 20 Marks]
QUESTION FOUR

The IASB`s Conceptual Framework is the basis upon which all IASs and IFRSs are based and
therefore determines how financial statements are prepared and the information they contain.

i. Identify which IAS builds on this framework and what the IAS states to be the
composition of a complete set of financial statements. (2 marks)
ii. Briefly explain how International Financial Reporting Standards (IFRSs) affect the
financial reporting process. (3 Marks)
iii. State and briefly explain the five elements of financial statements identified by the
Conceptual Framework. (5 Marks)
iv. Identify five key users of financial accounting information and why the information is
necessary for them. (10 marks).

[Total: 20 Marks]
QUESTION FIVE

A. Briefly explain each of the stages in the accounting Cycle or Accounting Process. ( 10
Marks)
B. Briefly explain the following accounting principles or concepts and in each case give an
appropriate example:
i. Going Concern
ii. Separate or Business entity
iii. Accruals or Marching Concept
iv. Money measurement
v. Accounting Period Concept
vi. Realization Concept
vii. Full Disclosure Concept
viii. Duality Concept
ix. Historical Cost Concept ( 10 Marks)
x. Verifiable Objective Concept

[Total: 20 Marks]

END OF ASSESMENT ONE