MIDTERM EXAMINATION (20%)

Duration: 50 minutes
Student Name : ASLAM HUSAINI BIN AHMAD TARMIZI

Class : INTRODUCTION ACCOUNTING

Score :

SECTION A: SHORT ANSWER QUESTIONS.

Circle the correct answer.

1. is an asset.

A. Buildings
B. Trade payable
C. Bank overdraft
D. Loan

2. Which of the following is a liability?

A. Machinery
B. Creditors
C. Motor Vehicles
D. Cash at Bank

3. Which is the correct accounting equation?

A. Asset = Liability – Capital

B. Liability = Asset + Capital
C. Capital = Asset + Liability
D. Asset = Liability + Capital

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4. A business had the following assets and liabilities.

$
Motor vehicle 5,900
Bank Loan 6,000
Cash at bank 49,000
Trade payable 800
Inventory 2,100
Premises 30,000

What is the value of capital ($)?

A. 80,200
B. 81,200
C. 81,800
D. 92,200

5. Which of the following is incorrect?

Assets Liabilities Capital

A. 7,850 1,250 6,600
B. 8,200 2,800 5,400
C. 9,550 1,150 8,200
D. 6,540 1,120 5,420
(5 Marks)

SECTION B: TRUE OR FALSE QUESTIONS

Circle the correct answer.

1. Building is not an asset. (True/False)

2. Trade receivable is also known as debtors. (True/False)

3. ‘Paid a creditor, B Lee, by cash’

Dr. B Lee
Cr. Cash
(True/False)

4. ‘A debtor, P Sangster, pays us by cheque’

Dr. P Sangster
Cr. Bank
(True/False)

5. Drawings is when owner withdraw business asset for his personal use. (True/False)
(5 Marks)

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SECTION C: PRACTICAL QUESTIONS
Question 1
Fill in the double entry account for each transaction.

December Account to Account to

2022 be debited be credited
1 Owner introduced capital of $8000 by cheque. 8000
3 Received $1100 money from a Michael by cheque. 1100 6900
3 Paid a creditor by cash $400. 6500
5 Sold van for cash $5000. 5000
6 We paid $2100 a creditor, Sally by cheque. 9400

8 Jolly lends us $500 by cheque. 9900

10 Bought office furniture of $1200 for cheque. 1200
15 Bought machinery for $3000 on credit from
3000
Betterways.
16 Goods bought on credit for $890 from Solemy. 890
18 Repaid part of loan of $400 from Charles by
400 400
cheque.
20 Returned some of office equipment worth $3100 to 3100
820
Sunshine Co.
21 Received $2800 cheque from a debtor, Dolly.
25 Goods worth $2300 bought by cheque. 2300
26 Paid rent of $300 by cheque. 300
27 Received commission of $2000 by cheque. 2000
29 Owner puts further cash $2000 and cheque $4000
6000
into the business.
30 Paid electricity bill of $1500 by cheque. 1500

30 Bought stationery $400 by cash. 400

31 Cash sales made $600. 600
31 Settled a creditor, Tommy $1000 by cheque. 1000

(15 Marks)

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Question 2
Refer to the transactions in Question 1 and prepare a Bank account. Balance the
account on 31 December 2022 and bring down the balances on 1 January 2023.

Bank account

31/12 Cash sale 600 1/1 Tottal 1600

Tommy by cheque 1000

(15 Marks)

[Total:40 Marks]

END OF QUESTIONS