Credit notes credit the debtors ac ri issued by us

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13) Credit notes (Credit the Debtor’s A/C = R.I) issued by us will be entered in our: A.Sales accountB.Returns Inwards accountC.Returns Inwards Day BookD. Returns Outwards Day Book E.The Journal 14) The total of the Sales Day Book is entered on: A The credit side of the Sales Account in the Sales Ledger X general ledger B. The credit side of the Sales Account in the General Ledger C. The debit side of the Sales Account in the General Ledger D. The credit side of the Sales Day Book. E. The credit side of the Sales Account in the Journal. Section B Question 1 Uber Co Ltd. commenced business on 1 January 20 x 3 with two vans – A and B. A cost $1,000 and B cost $1,600. On 3 March 20x4, A was written off in an accident and Uber received $750 from the insurance company. This van was replaced on 12 March 20 x 4 by C which cost $2,000. 3
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A full year’s depreciation is charged in the year of acquisition and no depreciation charged in the year of disposal. Required: You are required to show the appropriate extracts from the balance sheet and income statement for the three years to 31/12/20x3, 31/12/20x4 and 31/12/20x5 assuming that the vehicles are depreciated at 20% on the straight-line method. Question 2 The following list of ledger balances is extracted from the books of Wing’s Store, a sole trader as at 31 December 20x7. Wing’s Store: Accounts Balance as at 31 December 20x7 Capital $ 200,000 Stock at 1 Jan 20x7 20,634 Purchases 16,320 Sales 23,252 Sales returns 3,518 Purchases returns 5,095 Carriage inwards 1,483 Carriage outwards 2,310 Cash in hand 531 Discount allowed 2,548 Discount received 3,066 Machinery (cost) 83,300 Office equipment (cost) 67,300 Bank balance (overdraft) 10,464 Debtors 42,940 Creditors 18,102 Bad debts 6,909 Salesperson’s Commission 17,322 4
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Salaries 38,082 Insurance 3,457 Rates 1,774 General expenses 3,949 Prov. For accumulated depreciation: - Machinery at 1 January 20x7 37,730 - Office equipment at 1 Jan 20x7 26,500 Bad debts recovered 524 Drawings 13,176 Provision for doubtful debts 820 Additional information: 1. Stock at 31 December 20x7 was $30,898. Closing stock 2. $1,418 is further written off as bad debts at the end of the year.
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