VERIFIED OBJ ANSWERS.
BOOK KEEPING OBJ:
1-10: AACCBBCCCC
11-20: DCBAABBABB
21-30: AACDBABCDD
31-40: BACCCACAAA
Book keeping theory answers
1a)Final accounts give a concise idea about the profitability and financial position of a business to its management, owners, and other interested parties. All business transactions are first recorded in a journal. They are then transferred to a ledger and balanced. These final tallies are prepared for a specific period. The preparation of a final accounting is the last stage of the accounting cycle.
1bi) 1.Trade discount is given on the catalog price of the goods, while the cash discount is given on the invoice price.
2.Trade discount is granted with the aim of increasing the sales in bulk quantity, whereas Cash discount is granted to facilitate a quick payment.
3.Trade discount is allowed to all customers, while the Cash discount is allowed to those customers, who purchase goods in cash.
4.In case of Trade Discount, no entry is made in the books of accounts, while the proper entry is made in the books of accounts for the cash discount. 5.Trade discount is allowed at the time of purchase, while the cash discount is allowed at the time when the payment is done.
(2a)
Bad debts refers to account or trade accounts receivable that will not be collected. However, bad debts can also refer to notes receivable that will not be collected.
(2b)
The provision for doubtful debts is the estimated amount of bad debt that will arise from accounts receivable that have been issued but not yet collected. It is identical to the allowance for doubtful accounts.
(2c)
Accrued income is the income that is earned in a fund or by company by providing a service or selling a product, but has yet to be received. Mutual funds or other pooled assets that accumulate income over a period of time but only pay it out to shareholders once a year are, by definition, accruing their income.
(2d)
Prepaid expenses are future expenses that have been paid in advance. You can think of prepaid expenses as costs that have been paid but have not yet been used up or have not yet expired. The amount of prepaid expenses that have not yet expired are reported on a company's balance sheet as an asset.
(2e)
An accrued expense is an accounting expense recognized in the books before it is paid for. It is a liability, and is usually current. These expenses are typically periodic and documented on a company's balance sheet due to the high probability that they will be collected.
3a) Source document is the original record containing the details to substantiate a transaction entered in an accounting system. For example, a company's source document for the recording of merchandise purchased is the supplier's invoice supported by the company's purchase order and receiving ticket.
3b)
1.Quotation
2.Purchase Order
3.Sales Order
4.Credit Note
5.Invoice
6.Debit Note
7.Goods Dispatch Note
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