PRA-US

Date Monday, 17th February 2025 Student’s Name

Subject Accounting Marks

Grade 12 IPS

TOTAL : 85 MARKS

INSTRUCTION
For each questions below, there are four possible answers.
Choose the one you consider correct and write (A), (B), (C), (D) [15]

1. What is a statement of financial position?

A a calculation of the amount owed to the owner of the business

B a list of assets and liabilities of a business on a certain date
C a list of everything owned by and owed to a business
D a summary of money paid to and received by a business

2. Mahela is a trader. He took goods costing $100 for his personal use.
How should Mahela record this in his ledger?

Account to be Debited Account to be Credited

A. Drawings Inventory
B. Drawings Purchases
C. Inventory Drawings
D. Purchases Drawings

3. Jaswant purchased goods from Ali and paid in cash.

Which entries should Ali make in his ledger?

Account to be Debited Account to be Credited

A. Cash Sales
B. Jaswant Sales
C. Sales Jaswant
D. Sales Cash

4. Dinesh returned goods to his credit supplier, Thisara.

How should Dinesh record this in his ledger?

Account to be Debited Account to be Credited

A. Sales Returns Thisara
B. Purchases Returns Thisara
C. Thisara Sales Returns
D. Thisara Purchases Returns
5. Raminder paid a cheque of $975 to Kumar in full settlement of a debt of $1,000.
How did Kumar record this in his ledger?

Debit $ Credit $
A. Bank 975 Raminder 1,000
Discount Allowed 25
B. Bank 975 Raminder 1,000
Discount Received 25
C. Raminder 1,000 Bank 975
Discount Allowed 25
D. Raminder 1,000 Bank 975
Discount Received 25

6. Where is the total of the discount column on the credit side of a cash book posted?
A To the credit side of the discount allowed account
B To the credit side of the discount received account
C To the debit side of the discount allowed account
D To the debit side of the discount received account

7. The balance of which account may appear on the debit side of a trial balance?
A Carriage inwards
B Purchases returns
C Rent receivable
D Sales

8. In which book of prime entry will lee record credit notes he has issued?

A purchases journal
B purchases returns journal
C sales journal
D sales returns journal

9. On 1 May Sally owed William $400. On 21 May she purchased goods, list price $1 440, subject to
a trade discount of 25%. She returned one third of these goods on 24 May.
How much did Sally owe William on 31 May?

A $630
B $720
C $1030
D $1120

10. A business sells a non-current asset for cash. The disposal account records both the cost of the
asset and the sales proceeds.
Which books of prime entry should be used?

Option Cost of Asset Sales Proceeds

A Cash Book General Journal
 Option Cost of Asset Sales Proceeds
B Cash Book Sales Journal
C General Journal Cash Book
D Purchases Journal Cash Book

11. Which book of prime entry is used to record the sale of a non-current asset on credit?
A cash book
B general journal
C sales journal
D sales returns journal

12. Janet purchased goods on credit from Samir and later made the payment. While recording the
cash discount, Samir mistakenly reversed the correct accounting entry.
What was the incorrect double entry made by Samir in his books of account?

Option Debit Entry Credit Entry

A Discount Allowed Janet
B Discount Received Janet
C Janet Discount Allowed
D Janet Discount Received

13. The bank column of a business cash book showed a debit balance of $25,000.
Upon review, the following discrepancies were found:

Amount
Description
($)
Direct debit payments not recorded in the cash book 6,500
Payments for sales deposited directly into the bank by customers but not
5,500
recorded in the cash book
Bank charges not recorded in the cash book 1,500
Payment made by the business but not yet reflected in the bank statement 4,500

What is the correct balance in the cash book?

A $18 000
B $19 500
C $22 500
D $27 500

14. Which statement(s) are true of drawings?

1 They are a reduction in the owner’s investment.
2 They have to be less than the profit for the year.
3 They represent the salary paid to the owner.

A 1 and 2
B 1 only
C 2 and 3
D 3 only

15. Tom purchased goods worth $100 on credit from Sam. He later returned goods valued at $20 due
to faults.
He applied a cash discount and settled the payment by issuing a cheque for $76 in full settlement.
Which amounts should be recorded in Tom’s books of prime entry?

Purchases Purchases Returns Three-Column Cash

Option
Journal ($) Journal ($) Book (Bank Column) ($)
A 80 0 76
B 80 0 80
C 100 20 76
 Purchases Purchases Returns Three-Column Cash
Option
Journal ($) Journal ($) Book (Bank Column) ($)
D 100 20 80
 Question 1

The following are the transactions of Mrs Yuna in January 2025

Jan 1 Introduced Capital into the bank account for the business €40,000
Jan 4 Purchased Equipment, paid by cheque €23,000
Jan 8 Purchased goods on Credit from Hanni Ltd €8,000
Jan 10 Sold goods on Credit to Ryujin €550
Jan 12 Paid Advertising by cheque €330
Jan 13 Sale good to Fina paid in cash directly €580
Jan 14 Ryujin paid the business €550 owed
Jan 16 Purchased goods on Credit from Hanni Ltd €4,000
Jan 20 Paid to Hanni Ltd €10,000
Jan 22 Purchased goods on Credit from Peter & Co. for €1,500 less 25% trade discount
Jan 23 Paid rent by cheque €600
Jan 24 Returned goods to Peter & Co. to the amount of €50 after discount
Jan 25 Sold goods on Credit to K Shields €200
Jan 26 The owner of the business withdrew €500 for the bank account for own personal use
Jan 27 K. Shields returned goods to the value of €35
Jan 28 Purchased goods on Credit from Denver Ltd €1,000
Jan 29 Paid Denver Ltd €950 and received €50 discount which cleared the account
Jan 30 Sold goods on Credit K. Shields for €80
Jan 31 K. Shields cleared her account by paying her transaction and was allowed 5% cash
discount

Prepare the ledger accounts (T-Table) for the above transactions and balance c/d and balance b/d
the accounts and move the balance to create a Trial Balance [34]
 Question 2

A company has decided to sell goods worth $500 on credit to Pokki and send an invoice on June
1. On June 14, Pokki sent a debit note, and the company issued a credit note for the returned goods
worth $100. The company allowed a 10% cash discount if Pokki paid before June 21. Pokki told a
friend about the company, and Raja decided to buy goods worth $1200, less a 15% trade discount,
on June 16. Afterward, Raja thought he had not bought enough goods, so he purchased additional
goods worth $500, less a 15% trade discount, on June 19. On June 20, Pokki and Raja paid for their
transactions in cash.

a. Enter all transaction in the company books of prime entry [5]

b. Post the record of journal entry into the ledger account [7]
Question 3

In 2021, Yousif made bank payments totaling $5,200 for advertising expenses.

 (i) As of December 31, 2019, he determined that $740 had been paid for advertisements that
would not be published until 2022.
 (ii) In addition to the $740 mentioned in (a), Yousif realized that on January 1, 2021, there was
a prepaid advertising expense of $410.

a. Write the ledger entries required for the transactions described above. [4]
b. Extract and create the Income Statement and Statement of Financial Position based on the
provided transaction details. [8]
Question 4

In 2024, Keira made bank payments totaling $15,280 for office expenses.

 On January 1, 2019, there was an outstanding bill of $895.

 By December 31, 2019, an amount of $2,035 had been paid in advance.

a. Write the ledger entries required for the transactions described above. [4]
b. Extract and create the Income Statement and Statement of Financial Position based on the
provided transaction details. [8]