Group assignment submitted 5th February ,2024

Question one

The following trial balance was extracted from the books of XYZ the close of
business on 29th February 2023

Particulars Dr (Tshs) C r (Tshs)

Purchases and sales 92,800 157,165
Cash at bank 4,100
Cash in hand 324
Capital account I March 2022 11,400
Drawings 17,100
Office furniture 2,900
Rent 3,400
Wages and salaries 31,400
Discounts 820 160
Debtors and creditors 12,316 5,245
Stock 1st march 2022 4,120
Provision of doubtful debts 405
Delivery van 3,750
Van running costs 615
Bad debts written off 730
174,375 174,375
Additional information

a) Stock 29th February 2, 2024 Tshs 2,400

b) Wages and salaries accrued at 29" February 2022 Tshs 340
c) Rent prepaid at 29" February 2022 Tshs 72
d) Increase the provision for doubtful debts by Tshs 91
e) Provide for depreciation as follows: office furniture Tshs 380 and delivery van
Tshs 1,250

Required:

a) Prepare statement of profit and loss for the year ended

b) Prepare statement of financial position
Question two

You have extracted a trial balance and drawn up accounts for the year ended 31st
December 2023. There was a shortage of Tshs 78,000 on the credit side of the trial
balance, a suspense account being opened for that amount.

During 2024 the following errors made ni 2023 were found:

a) Tshs 125,000 received from sales of old equipment has been entered in the
sales account.
b) Purchases day book had been overcast by Tshs 10,000.
c) A private purchase of Tshs 140,000 had been included in the business
purchases.
d) Bank Charges Tshs 22,000 entered in the cash book have not been posted of
the bank charges account.
e) A sale of goods to Mali Tshs 230,000 was correctly entered in the sales book
but entered in the Mali account as Tshs 320,000.

Required:

i. Show the requisite journal entries to correct the errors.

ii. Write up the suspense account showing the correction of the errors.
iii. The net profit originally calculated for 2023 was Tshs 400,820. Show your
calculation of the correct net profit for the year