2.Nia Njema commenced business as a transport contractor on 01.03.2001. He makes up his accounts annually to 28thFebruary. He depreciates his vehicles at the rate of 20% on the straight line method. A full year's depreciation is charged in the year of purchases and none in the year of sale. His transactions are as follows:
Using the above transactions, you are required to write up in Nia Njema's books for the year ended 28.2.2002, 28.2.2003 and 28.2.2004 on the following:
(ii)Provision for depreciation of lorries account, and
3.Alizeti PLC whose accounting year ends 31stDecember, invested in marketable securities. The transactions during the year were as follows:
(i)Initial Investments on 1stSeptember, 2004 were Sh. 500,000 (nominal value) 12% Dar es Salaam City Council Loan Stock at Sh. 500,000 (normal value) 12% Dar es Salaam City Council Loan Stock at Sh. 0.92. Interest is payable half yearly on 30thJune and 31stDecember.
(ii)A further Sh. 100,000 (nominal value) was acquired on 1stOctober, 2005 at Sh. 0.95.
(iii)A further Sh. 100,000 (nominal value) was acquired on 1stDecember, 2005 at Sh. 0.94.
You are required to post and balance the investment account in Alizeti PLC's ledger, assuming that the appropriate amount of interest is received on the due dates.
7.A book keeper extracted a trial balance on 31stDecember, 2010 which failed to agree by Sh. 210,000, a shortage on the credit side of the trial balance. A suspense account was opened for the difference. In January 2011 the followings errors made in 2010 were found:
Sales day book had been under cast by Sh. 200,000.
Sales of Sh. 610,000 to T. Majumu had been debited in error to T. Majuni's account.
Rent account had been under cast by Sh. 90,000.
Discount allowed account had been over cast by Sh. 100,000.
The sales of a computer at net book value had been credited in error to the sales account Sh. 230,000.
By using this information:
(i)Show the journal entries necessary to correct the errors.
(ii)Write up the suspense account after the errors described have been corrected.
(iii)If the net profit had previously been calculated at Sh. 31,400,000 for the year ending 31stDecember, 2010, show how the calculations of the corrected net profit would appear.
(b) The book of Mango Tree Ltd includes three ledgers comprising of an impersonal ledger, debtors' ledger and creditor's ledger. The impersonal ledger contains debtors’ ledger and creditors' ledger control accounts as part of the double entry.
The following information relates to the accounting year ended 30thJune, 2008.
You are required to prepare the debtors' ledger and creditors' ledger control accounts.