THE UNITED REPUBLIC OF TANZANIA

NATIONAL EXAMINATIONS COUNCIL OF TANZANIA CERTIFICATE OF SECONDARY EDUCATION EXAMINATION

062           BOOK KEEPING

(For Both School and Private Candidates)

Time: 3 Hours                                      Tuesday, 12^th November 2019 p.m.

Instructions

1. This paper consists of sections A, B and C with a total of nine (9) questions.
2.  Answer all questions in sections A and B and two (2) questions from section C.
3. Non programmable calculators may be used.
4.  Cellular phones and any unauthorised materials are not allowed in the examination room.
5. Write your Examination Number on every page of your answer booklet(s).

SECTION A (20 Marks)

Answer all questions in this section.

1. For each of the items (i) - (xv), choose the correct answer from among the given alternatives and write its letter beside the item number in the answer booklet provided.

(i) When a new partner is admitted to a partnership business, any decrease in value of an asset resulting from valuation is debited to

1.  asset account.
2. cash account.
3. trading Account.
4. revaluation account. 
5. partners Capital Account.

(ii) From the following categories of errors, identify the category of errors which affect only one account

1. Casting errors
2. Errors of principle
3. Errors of omission
4. Errors of original entry
5. Errors of commission

  (iii) Which of the following books of prime entry is used to record a list of goods sold on credit?

1. The sales return day book
2. The purchases day book
3. The sales day book
4. The purchases return daybook 
5.  The discount received book 

(iv) Which of the following accounting errors are corrected through the suspense account?

1. Compensating errors
2. Errors of complete reversal of entries
3. Errors of principle
4. Posting a different figure to an account 
5. Errors of omission 

  (v) The term depreciation would best be described as the

1.  value of money used to replace non-current assets.
2.  value of non-current assets consumed due to its use.
3.  gradual increase in value of non-current assets due to its use.
4.  value of a non-current asset that remains after its use.
5.  amount incurred to repair the non-current assets.

  (vi)A business had an opening and closing capital balances of TZS 57,000 and TZS 64,300 respectively in a certain financial year. The drawings during the same year amounted to TZS 11,800. What was the amount of profit made by the business during that year?

1.  TZS 19,100 
2.  TZS 16,600 
3. TZS 5,000
4. TZS 19,600
5. TZS 18,600

(vii) What should be the accounting entry for expenses incurred by a consignor in his books of accounts?

1.  Credited to consignment account and debited to goods sent on consignment account
2.  Debited to cash book and credited to consignment account
3.  Debited to consignment account and credited to cash/bank account
4.  Credited to goods sent on consignment account and debited to cash/bank account
5. Debited to cash/bank account and credited to consignee account

(viii) Under which of the following circumstances can an auditor issue a qualified audit opinion?

1.  When the auditor conclude that all aspects of the financial statements are fine with exception of the matter to which the qualification relate.
2.  When the auditor is unable to form an opinion as to whether the financial statement give a true and fair view.
3.  When the effects of disagreement is so material and pervasive that a qualification is not adequate to disclose the misleading nature of the financial statements.
4.  When the auditor is satisfied in all materials respects that the financial statements show a true and fair view of the affairs of the entity.
5.  When the auditor doesnt express her opinion on the financial statement it may be because the auditors independence was intervened.

(ix) Given balance as per cash book TZS 6,500, uncredited cheque TZS 1,500, bank charges not yet entered in the cash book TZS 500 and credit transfer received by bank but not yet entered in the cash book TZS 1,000. What will the balance as per bank statement?

1. TZS 7,500
2. TZS 4,500
3. TZS 8,500
4. TZS 5,500
5. TZS 6,500 

(x) When preparing a trial balance, what would result if sales made to Ramima TZS 57,000 is wrongly debited to Ramimas account as TZS. 75 000?

1.  Debit column of trial balance will exceed credit column by TZS 75,000
2.  Credit column of trial balance will fall by TZS 75,000
3.  Debit column of trial balance will exceed credit column by TZS 18,000
4.  Credit column of trial balance will exceed debit column by TZS 18,000
5.  Debit column of trial balance will exceed credit column by TZS. 57,000

(xi) What is the amount of stock reserve on a closing stock of TZS 6000 in department B if goods are transferred from department A to department B at a price which includes a profit of 25% on cost?

1. TZS 1,200 
2. TZS 2,200 
3. TZS 1,500 
4. TZS 2,500
5. TZS 2,000

(xii) Government accounting is important for countries like Tanzania because it 

1. expends more money in the system.
2.  has the largest volume of monetary transactions.
3.  provides more revenues and expenses.
4.  prepares a budget duly passed by the parliament. 
5. uses more money for schools.

(xiii) The suppliers personal accounts are kept in the

1.  sales ledger. 
2. private ledger.
3. general ledger. 
4. nominal ledger.
5. purchases ledger.

(xiv) A credit balance in the income and expenditure account indicates the excess of

1. income over expenditure. 
2. cash receipts over credit sales. 
3. expenditure over income. 
4. gross profit over expenses. 
5. expenses over net profit.

(xv) Which of the following depreciation methods uses the reduced value to compute the depreciation of a non-current asset?

1.  Straight line method          
2. Sum of the years digits method
3. Diminishing balance method                 
4. Machine hours rate method
5. Unit of output method

2.For each of the items (i) - (v), match the descriptions of the different types of capital in Column A with their corresponding names in Column B by writing the letter of the correct response beside the item number in the answer booklet provided.

SECTION B (40 Marks)

Answer all questions in this section.

3. Briefly explain the following accounting concepts:

1.  Business entity
2. Money measurement
3.  Accruals
4.  Going concern
5. Dual aspect

4. A partnership may be formed through an oral or a written legal agreement among the partners. Suppose there is no written partnership agreement, explain briefly five provisions of the Partnership Act that would govern the operations of the partnership.

5.The following is the Cash Book of Mr Nguzo as at 31 ^st August 2016.

               DR                                    Cash Book                                   CR

Use the principle of double entry to post the entries from the cash book to their respective ledger accounts and balance off the accounts at 3 1 ^st August 2016.

6. Rasheeda is a treasurer of the Down Town Sports Club; she has not kept proper book keeping records but has kept notes in a diary form of the Clubs transactions for the year ended 31 ^st December 2018. She is able to give you the following list of assets and liabilities of the Club at 3 1 ^SDecember 2018:

     Details                                                              31 ^st December 2018

Additional information:

The Clubs accumulated fund at I ^st January 2018 amounted to TZS 954, 100. Drawings during the year amounted to TZS 260,000.

Using the information provided prepare:

1. The Clubs statement of affairs and determine the Clubs accumulated fund at 31 ^st December 2018.
2. The statement showing the computation of surplus or deficit of income over expenditure of the Club for the year 2018.

SECTION C (40 Marks)

Answer two (2) questions from this section.

7. On I ^st September 2018 Viera Nick, an entrepreneur and cafe manager had the following financial position relating to her business activities:

TZS

During September 2018, the following events occurred:     

1.  Mkombozi settled his account after taking a cash discount of 20%.
2.  Ujamaa is declared bankrupt and no payments are expected in respect of the debt.
3.  Uzalendo paid his debt in full.
4.  All accounts payable were paid and Navona allowed Viera Nick a cash discount of 10%.
5. The following transactions were paid in cash: salaries and wages TZS 50,000, general expenses TZS 15,000 and rent and rates TZS 22,000.

Open the bank Account, Cash Account, Discounts Allowed Account, Discounts Received Account, Bad Debts Account, the customers Accounts in the sales ledger and the suppliers Accounts in the purchases ledger, record the given information and balance off the accounts at 30^th September, 2018.

8. Enter the following transactions in the Three Column Cash Book of Mrs Pamba, balance it off at the end of April 2017 and show the discounts accounts in the general ledger:

April 1  Mrs Pamba had the following balances in her cash book; cash in hand TZS 62,000              and at bank TZS 714,200.

2   The following debtors paid their accounts by cheque, in each case deducting 5% cash discount: G. George TZS 26,000, P. Peter TZS 32,000, T. Tabu TZS 42,000 (All amounts are pre discounts).

4   Mrs Pamba paid rates by cheque TZS 43,000.

6   Mrs Pamba received a loan from F. Fabian TZS 500,000 by cheque.

8   Mrs Pamba paid the following accounts by cheque and in each case deducting 3% cash discount: R. Robert TZS 72,000, G. Green TZS 96,000, L. Lamona TZS 160,000 (All amounts are pre discounts)

10   Mrs Pamba paid general expenses in cash TZS 8,100.

12   J. Juma a debtor paid his account ofTZS 9,000 by cheque TZS 8,800, after deducting TZS 200 cash discount.

15   Mrs Pamba paid salaries in cash TZS 58,000.

21   Mrs Pamba withdrew cash from bank TZS 40,000 for business use.

24    Mrs Pamba withdrew cash for personal use TZS 20,000.

25    Mrs Pamba bought motor van paying by cheque TZS 72,000.

30   Mrs Pamba received commission by cheque TZS 12,000.

9.   The following is a trial balance of Mr Mashamba for the year ended 31^st December 2018:

Mr Mashambas Trial Balance as at 31 December 2018

Notes at 31/12/2018:

 (i)Inventory of raw materials TZS 480,000, inventory of finished goods TZS 800,000 and inventory of work in progress TZS 300,000.

(ii) Lighting, rent and insurance are to be appoftioned as follows: Factory 5/6, administration 1/6.

(iii) Depreciation on machinery and plant and office fixtures is 10% per annum on cost.

 (iv) Net Profit was TZS. 1,796,000.

Use the given information to prepare the Statement of Manufacturing Cost for the year ending 31 ^st December 2018 and the Statement of Financial Position as at 31^st December 2018.