Use the information below to answer this questionSegunOjo, didn’t keep her books on double principle. On 1st Jan, 2014, cash in hand was 850, bank overdraft...
Question 1 Report
Use the information below to answer this questionSegunOjo, didn’t keep her books on double principle. On 1st Jan, 2014, cash in hand was 850, bank overdraft 3500, debtor 15,500,stock 18,000, fittings 9,000 and creditors 12,700. As at Dec, 2014, cash in hand was 1200, cash at bank 2,500, debtors 10,000, stock 20,500, furnishing 4,000 and creditors 17,000Determine the closing capital 31/12/2014
Answer Details
To determine the closing capital as at 31/12/2014, we need to calculate the total assets and total liabilities of SegunOjo's business as at that date, and then subtract the total liabilities from the total assets. The resulting figure will be the closing capital.
Total assets as at 31/12/2014:
- Cash in hand: 1200
- Cash at bank: 2500
- Debtors: 10000
- Stock: 20500
- Furnishing: 4000
Total assets = 1200 + 2500 + 10000 + 20500 + 4000 = 41,700
Total liabilities as at 31/12/2014:
- Creditors: 17000
Total liabilities = 17000
Closing capital = Total assets - Total liabilities
= 41,700 - 17000
= 27,700
Therefore, the closing capital as at 31/12/2014 is 27,700. Option (D) is the correct answer.
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