Student's Assessment Number............



Time 2:30 Hours Year 2022


  1. This paper consists of sections A, B and C with a total of nine (9) questions.
  2. Answer all questions.
  3. Section A carries fifteen (15) marks, section B forty (40) marks and section C carries forty five (45) marks.
  4. All writing must be in blue or black ink.
  5. All answers must be written in the spaces provided.
  6. Non programmable calculators may be used.
  7. Cellular phones and any unauthorised materials are not allowed in the assessment room.
  8. Write your Assessment Number at the top right hand corner of every page.

SECTION A (15 Marks)

Answer all questions.

1. For each of the items (i) — (x), choose the correct answer from the given alternatjycs and write its letter in the box provided.

(i) James, the owner of coffee shop took TZS 18,000,000 from the coffee shop account. He used the money to buy a motor vehicle for his wife. The act by James is best described as

  1. purchases.
  2. sales.
  3. drawings.
  4. capital.
Choose Answer :

(ii) Mengi sold a machine for cash TZS 8,000,000. What would be the effect of this transaction in the accounting records?

  1. Asset of cash will increase, Asset of machine will decrease.
  2. Asset of cash will decrease, Asset of machine will increase.
  3. Asset of cash will increase, Asset of machine will increase.
  4. Asset of cash will decrease, Asset of machine will decrease.
Choose Answer :

(iii) A Book Keeping teacher asked students in a class to define a Trial Balance. Which definition would you give?

  1. Is a statement showing a list of debit and credit balances.
  2. Is a statement showing a list of debit balances.
  3. Is a statement showing a list of credit balances.
  4. Is a statement showing a list of assets and liabilities.
Choose Answer :

(iv) The following are internal users of financial statements except

  1. managers.
  2. owners.
  3. investors.
  4. wholesalers.
Choose Answer :

(v) What would be the double entry for cash withdrawn from bank for business use?

  1. Debit cash account, credit business account.
  2. Debit business account, credit bank account.
  3. Debit bank account, credit cash account.
  4. Debit cash account, credit bank account.
Choose Answer :

(vi) Mr. Swai purchased goods on credit from Jones for TZS 3,800,000. The supplier offered him a trade discount of 2%. How much would be the amount due to the supplier?

  1. TZS 3,876,000
  2. TZS 3,800,000
  3. TZS 3,724,000
  4. TZS 76,000
Choose Answer :

(vii) During the Book Keeping lesson, students were taught about expenses that can be paid out of petty cash. The following are among those expenses, except

  1. van replacement cost.
  2. staff travelling cost.
  3. wages cost.
  4. postage cost.
Choose Answer :

(viii) The bank column of the cash book showed a credit balance of TZS 1,600,000. If the bank statement shows a standing order payment of TZS 200,000, how much would be the adjusted cashbook balance?

  1. TZS 1,200,000 debit balance
  2. TZS 200,000 credit balance
  3. TZS 1,800,000 debit balance
  4. TZS 1,800,000 credit balance
Choose Answer :

(ix) The appropriate measure to correct budget deficit of the government may involve

  1. seeking aids and grants abroad.
  2. encouraging more expenditure on unproductive sectors.
  3. reducing taxes and levy.
  4. increasing recurrent expenditure.
Choose Answer :

(x) Which error is corrected through the suspense account?

  1. Commission received of TZS 210,000 debited to sales account.
  2. Credit note issued of TZS 500,000 not recorded in the books.
  3. Purchase of office furniture TZS 450,000 debited to purchases account.
  4. Purchase of stationery TZS 250,000 entered in the books as TZS 25,000.
Choose Answer :

2. For each of the items (i) to (v), match the descriptions of types of errors which do not affect the agreement of a trial balance in Column A with their corresponding names in Column B by writing the letter of the correct response below the item number in the table provided.

Column A Column B

(i) An error where a transaction is not recorded in the books.

(ii) An error where the correct amount is entered but in the wrong account.

(iii) An error where an item is entered in the wrong class of account.

(iv) An error where errors cancel out each other in the trial balance.

(v) An error where the original amount of a transaction is incorrectly recorded in the accounts.

  1. Error of principle
  2. Complete reversal of entries
  3. Error of commission
  4. Compensating error
  5. Error of original entry
  6. Error of omission
  7. Error of recording


Column A (i) (ii) (iii) (iv) (v)
Column B

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SECTION B (40 Marks)

Answer all questions.

3. Credit note and debit note are documents widely used in recording financial business transactions. Briefly contrast between the two documents by giving five points.

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4. For each of the transactions (i) — (x), state the name of the account to be debited and the account to be credited by inserting the name of the account in the appropriate column.

S/N Transaction Account to be Debited Account to be Credited
(i) Started business with cash in hand

(ii) Cash purchase of goods for resale

(iii) Paid rent by cash.

(iv) Deposited cash into bank.

(v) Paid insurance through bank.

(vi) Sold good on credit to Pamoja.

(vii) Sold goods in cash to John.

(viii) Cash withdrawn from bank for personal use.

(ix) Bought stationeries for cash.

(x) Received a cheque from Pamoja.

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5. Mataya traders bought goods worth TZS 5,000,000 from Khumbo Stores. Mataya is offered a trade discount of 10% and a cash discount of 5% if he pays the bill within 30 days. Use the information provided to calculate the following:

(a) Trade discounts

(b) Amount due to Khumbo Stores

(c) Discount received if he paid within 30 days

(d) Net amount to be paid to Khumbo Stores

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6. The bank column of Kinyonga's cash book showed a balance of TZS 7,500,000 on 31st March, 2021, while the bank statement showed a balance of TZS 4,700,000. Analyze five causes for the difference between the two balances.

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7. Mwendapole Enterprises had the following transactions for the month of April 2021:

April 1 Bought from Majogoo traders:
100 dozens of kids clothes @ TZS 3,000.
250 pairs kids shoes @ TZS 2,000.
7 Bought from Wasanii traders:
100 cartons of milk biscuits @ TZS 4,000.
130 cartons of tamu biscuits @ TZS 2,000.
200 cartons of leo biscuits @ TZS 1,000.
10 Returned to Wasanii traders:
15 cartons of mango juice @ TZS 4,000.
10 cartons of apple juice @ TZS 2,000.
15 Bought from Tuwangoma:
50 boxes of white chalk @ TZS 2,000.
45 boxes of red chalk @ TZS 1,500.
60 boxes of blue chalk @ TZS 1,500.
50 boxes of green chalk @ TZS 1,000.
25 Bought from Lipembe clothes worth TZS 300,000
28 Returned to Tuwangoma:
25 boxes of while chalk @ TZS 2,000.

Record the transactions for April, 2021 in the Purchases Journal, Purchases Returns Journal and post the entries to the Purchases Account, Returns Outwards Account, Majogoo Traders Account, Wasanii Traders Account, Tuwangoma Account and Lipembe Account.

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8. The financial year of Hamisa & Family Stores ends on 31st December annually. The information has been extracted from Stores' accounting records for the year ending 31st December 2020:

Details Balances in TZS
Inventory on 1st January 2020 1,037,000 1,037,000
Purchases 8,500,000
Rent 450,000
Insurance 187,000
Heating expenses 160,000
Motor van expenses 584,000
Salaries 922,000
Sales 9,780,000
Sundry expenses 252,000
Motor van 1,050,000
Creditors 1,975,000
Debtors 2,016,000
Fixtures & Fittings 1,011,200
Buildings 8,200,000
Cash at bank 848,400
Drawings 1,416,600
Capital 10,079,400
Cash in hand 500,000
Bank loan 5,300,000
Inventory on 31st December 2020 1,535,000

Use the information provided to prepare the Store's Income Statement for the year ending December, 2020 and Statement of Financial Position as at 31st December, 2020.

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9. A trial balance extracted from the books of Beda had the following totals: Debit column total TZS 938,400 and Credit column total TZS 932,300. Beda placed the difference in the books in a newly opened suspense account. Later on, he discovered the following errors:

(a) A credit note of TZS 2,300 received from Zamzam a wholesaler had not been recorded anywhere in the books.

(b) A credit note of TZS 1,400 issued to Mawiwo, a retailer had been entered correctly in the appropriate subsidiary book but had not been posted to the personal account.

(c) A cheque of TZS 7,400 received from Dennis was entered as TZS 4,700 in the cash book and posted to the ledger accordingly.

(d) Discounts allowed, TZS 2,350, were credited to discounts received account in the ledger.

(e) Rent received, TZS 2,200, has been credited to premises account.

(f) Sales book was under cast by TZS 9,400.

(g) Motor vehicle expenses TZS 15,000 was posted to salaries account.

(h) A sale on credit to Ashurah was entered to Shirati account.

Use the information provided to pass Journal entries to rectify the errors and prepare the Suspense Account.

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