TEST NO.

QUES 1: (2p)
a. Distinguishing the accounting methods of purchasing raw materials for administrative & non-
business activities and business activities?
b. Explain true or false and give illustrative examples: all fixed assets used in the administrative
and non-business units are only required to calculate the wear & tear value?

QUES 2: (2p)
In an educational non-business unit in year N, there has following transactions:
1. Received the approval of the budget estimates for the year of 460,300
2. Provisional withdrawal from budget estimates to the cash fund 200,000; cash at bank 260,300
for non-business operational activities
3. Collected the other retanied income of 80,000; deposited into the treasury account
4. Calculated the salaries payable to employees 180,000
5. Calculated salary deductions according to current regulations
6. Paid salaries payable and other salary deductions by cash at bank
7. Expenses for non-business operational activities 120,000 by cash in hand and 80,000 by
withdrawal from other retained income at the treasury account
8. Paid electricity and water bills to the providers by cash at bank 38,000
9. Purchased raw materials 80,000 by cash in hand
Requirements: Prepare journal entries?

QUES 3: (2p)
Requirements: From Question 2
1. Make the end-of-period entries; knowing that closing inventory is 21,000?
2. Determine the income summary for educational non-business activities?

QUES 4: (2p)
Extracting accounting documents at a non-business unit in year N
1. Disposal of 1 car with original cost of 400,000 and wear & tear of 250,000. This car was
formed by the State budget, 8-year useful life, straight line method;
2. Purchased 1 blood test machine using the State budget source by withdrawal from Budget
estimates, paid the 10% VAT-exclusive price of 300,000, the wear & tear rate 10%, straight line
method;
3. Converted the multi-purpose hospital bed set into tool, original cost of 100,000, has worn out
90,000, knowing that this asset was budgeted and used for non-business activities, 10-year useful
life, straight line method;
4. Purchased 1 ultrasound machine with tax-inclusive price of 900,000, VAT 10%, paid by cash
at bank, useful life of 10 years, straight line method. This asset was invested by the non-business
development fund, used 50% for service business and 50% for non-business activities.
Requirements: Making journal entries?

QUES 5: (2p)
From question 4, perform year-end journal entries for these assets? (Wear & Tear
expense is 230,000 and no depreciation expense for year (N-1).)

Closed - book examination

Enclose this with your exam paper – Protors are not required to answer any question