a. The authorized and issued share capital of Ozideli Limited comprised 400,000 ordinary shares of Le 1 each and 100,000 8% preference shares of Le 1 each. ...

Assessment: WAEC SSCE - Financial Accounting - 2022 (Essay) Subject: Financial Accounting

Question 1 Report

a. The authorized and issued share capital of Ozideli Limited comprised 400,000 ordinary shares of Le 1 each and 100,000 8% preference shares of Le 1 each. The trial balance at the end of the year was as follows:

Trial Balance as at 31st December 2018

Dr Cr
Le Le
Sales1,500,000
Purchases1,000,000
General expenses280,000
Debenture interest8,400
7% Debentures120,000
Ordinary share capital400,000
8% Peference share capital100,000
Plant and machinery at cost160,000
Motor vehicle at cost70,000
Profit and loss account (31/12/17)8,600
Creditors172,400
Debtors500,000
General reserve10,000
Provision for depreciation:
Plant and Machinery;20,000
Motor vehicle10,000
Bank22,600
Stock (31/12/17)300,000
2,341,0002,341,000

Additional information:
(i) Stock on hand at 31/12/2018 was Le 400,000;
(ii) The directors were to receive remuneration of Le 70,000;
(iii) Depreciation is to be calculated on plant and machinery at Le 32,000 and motor vehicle at Le 14,000;
(iv) The directors decided to transfer Le 12,000 to general reserve;
(v) Preference dividend for 2018 will be paid on 10/01/2019.

You are required to prepare:

Trading, Profit and Loss and Appropriation Account for the year ended 31st December 2018;

b. The authorized and issued share capital of Ozideli Limited comprised 400,000 ordinary shares of Le 1 each and 100,000 8% preference shares of Le 1 each. The trial balance at the end of the year was as follows:

Trial Balance as at 31st December 2018

Dr Cr
Le Le
Sales1,500,000
Purchases1,000,000
General expenses280,000
Debenture interest8,400
7% Debentures120,000
Ordinary share capital400,000
8% Peference share capital100,000
Plant and machinery at cost160,000
Motor vehicle at cost70,000
Profit and loss account (31/12/17)8,600
Creditors172,400
Debtors500,000
General reserve10,000
Provision for depreciation:
Plant and Machinery;20,000
Motor vehicle10,000
Bank22,600
Stock (31/12/17)300,000
2,341,0002,341,000

Additional information:
(i) Stock on hand at 31/12/2018 was Le 400,000;
(ii) The directors were to receive remuneration of Le 70,000;
(iii) Depreciation is to be calculated on plant and machinery at Le 32,000 and motor vehicle at Le 14,000;
(iv) The directors decided to transfer Le 12,000 to general reserve;
(v) Preference dividend for 2018 will be paid on 10/01/2019.

You are required to prepare:

Balance sheet as at that date

Answer Details

a. TRADING ,PROFIT OR LOSS AND APPROPRIATION ACCOUNT FOR THE YEAR ENDED 31ST DECEMBER, 2018

  Le   Le
Opening stock 300000 Sales 1500000
Add purchases 1000000    
  1300000    
Less closing stock 400000    
  900000    
Gross profit 600000    
  1500000   1500000
EXPENSES:      
General expenses 280000 Gross profit 600000
Debenture interest 8400    
Depreciation on plant & Machinery 32000    
Depreciation on motor vehicle 70000    
Net profit 209,600    
  600000   600000
General reserve 12000 Net profit b/d 209,600
Preference dividend 8000 Profit carried forward 8600
Balance c/d( profit) 184200    
  204200   204200

 

b. 

BALANCE SHEET AS AT THAT DATE

Authorized Capital : Le Fixed Assets Le Le Le
Ordinary share 400000 Plant and Machinery 160000 52000 108000
8% Preference share 100000 Motor Vehicle 70000 24000 46000
Issued capital:          
Ordinary share 400000 Current Assets      
8% Preference share 100000 Stock     400000
Profit b/d 124200 Debtors     500000
General reserve 22000 Bank     22600
Long term liability:          
7% debenture 120000        
Current liability:          
Creditors 172400        
Director fee 70000        
Proposed dividend 12000        
  1080600       1080600

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