Description

BOOK KEEPING & ACCOUNTING

Question One (a)

1. Explain the following classes of accounts:
   • Personal account (1 mark)
   • Real account (1 mark)
   • Nominal account (1 mark)
2. Identify and explain atleast FOUR (4) users of accounting information in a law firm.

(4 marks)

1. Differentiate between the following terms implied in accounting:

2019. Jane Mwihaki opened a small business in Gikomba on 1 ^st October 2019. Her transactions for the month of October were as follows:

October 2                         Opened a bank account and deposited shs. 150,000, paid by cheque

• Paid rent in cash shs 13,000
• Purchased goods for shs 160000 from Mareva and Company on credit
• Sold goods for shs. 260,000 cash
• Banked shs. 230,000

9                         Purchased office furniture for shs 150,000 paid by cheque

• Purchased goods for shs. 130,000 from Mwango Drapers and paid half of the amount by cheque
• Sold goods worth shs. 126,000 on credit to Mbaya exporters.
• Mbaya Exporters returned goods worth shs 16000

16                       Received a cheque of shs. 60,000 from Mbaya exporters

19                        Purchased goods on credit from S. Omolo

21                       Sold goods of shs. 15000 on credit to BX Boutique

• Paid Marwa and Company shs. 144,000 in full statement of the amount owned to them by cheque
• Withdrew cash shs. 16,000 for personal use.

26                        Bought goods shs. 18,000 and paid by cheque

BX Boutique paid by cheque shs. 13,500 in full settlement of other debt

28                        Paid by cheque Mwango Drappers debt

31                       Paid salaries shs. 15,000 and water bill shs 1700 by cheque

Required: Relevant entries to the ledger and extract her trial balance as at 31 ^st October 2019.                                                           (15 marks)