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    Exercises and Answers Q1 To 4 - Ledger Account For Accruals and Prepayments

    Uploaded by

    Nayaz Emamaullee
    The document contains 4 exercises showing accounting entries for various expense accounts - Rates, Electricity, Insurance, and General Expenses. Each exercise shows debits and credits to the relevant expense account over a year with opening and closing balances, payments made, and expenses incurred as per the income statement.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Exercises and Answers Q1 To 4 - Ledger Account For Accruals and Prepayments

    Uploaded by

    Nayaz Emamaullee
    81 views1 page
    The document contains 4 exercises showing accounting entries for various expense accounts - Rates, Electricity, Insurance, and General Expenses. Each exercise shows debits and credits to the relevant expense account over a year with opening and closing balances, payments made, and expenses incurred as per the income statement.

    Original Description:

    Worked examples for ledger accounts for accruals and prepayments Part 1

    Original Title

    Exercises and Answers Q1 to 4 - Ledger Account for Accruals and Prepayments

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    The document contains 4 exercises showing accounting entries for various expense accounts - Rates, Electricity, Insurance, and General Expenses. Each exercise shows debits and credits to the relevant expense account over a year with opening and closing balances, payments made, and expenses incurred as per the income statement.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    81 views1 page

    Exercises and Answers Q1 To 4 - Ledger Account For Accruals and Prepayments

    Uploaded by

    Nayaz Emamaullee
    The document contains 4 exercises showing accounting entries for various expense accounts - Rates, Electricity, Insurance, and General Expenses. Each exercise shows debits and credits to the relevant expense account over a year with opening and closing balances, payments made, and expenses incurred as per the income statement.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 1

    Exercise 1

    A business pays rates $2 500 per annum. In year ending 31 December 2019, amount actually paid by
    cheque was to $2 600. There were neither due nor prepaid rates at 1 January 2019. Show the Rates
    account.
    Dr Rates Account Cr
    Date Details Amount Date Details Amount
    $ $
    31 Dec Bank 2 600 31 Dec Income Statement 2 500
    31 Dec Balance c/d - prepaid 100
    2 600 2 600
    1 Jan Balance b/d - prepaid 100

    Exercise 2
    A business has incurred electricity amounting to $1 900. In year ending 31 December 2019, only an
    amount of $1 600 was paid in cash. There were neither due nor prepaid rates at 1 January 2019. Show
    the electricity account.
    Dr Electricity Account Cr
    Date Details Amount Date Details Amount
    $ $
    31 Dec Bank 1 600 31 Dec Income Statement 1 900
    31 Dec Balance c/d - due 300
    1 900 1 900
    1 Jan Balance b/d - due 300

    Exercise 3
    On 1 April 2019, a business had prepaid insurance $120. During the year ended 31 March 2020,
    insurance paid by cheque were $2 200. Insurance incurred for the year ended 31 March 2020 amount
    to $2 120. Show the Insurance account.
    Dr Insurance Account Cr
    Date Details Amount Date Details Amount
    $ $
    1 April 19 Balance b/d - prepaid 120 31 Mar 20 Income Statement 2 120
    31 Mar 20 Bank 2 200 31 Mar 20 Balance c/d - prepaid 200
    2 320 2 320
    1 April 20 Balance b/d - prepaid 200

    Exercise 4
    On 1 January, general expenses due amounted to $50. During the year, amount paid for general
    expenses were $1 100 by cheque and $300 in cash. General expenses incurred for the year amounted
    to $1 500. Show the General Expenses account.
    Dr General Expenses Account Cr
    Date Details Amount Date Details Amount
    $ $
    Dec 31 Bank 1 100 Jan 1 Balance b/d - due 50
    Dec 31 Cash 300 Dec 31 Income statement 1 500
    Dec 31 Balance c/d - due 150
    1 550 1 550
    Jan 1 Balance b/d - due 150

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