Exercise 3 - Green & Blue Inc.

11 Questions | Total Attempts: 128

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Exercise 3 - Green & Blue Inc.

Prepare an adjusted trial balance for the Company as per 31. 12. 2013 according to the transactions in the quiz.


Questions and Answers
  • 1. 
    None posted VAT payment for Q3 according to the balance of the account “VAT payable”. The payment was made from the bank overdraft before 31.12.2013.
    • A. 

      The VAT payable account (liability) is debited 33.000

    • B. 

      The bankoverdraft account (liability) is credited 33.000

    • C. 

      The VAT payable account (liability) is credited 33.000

    • D. 

      The bankoverdraft account (liability) is debited 33.000

  • 2. 
    None posted and unpaid audit fee for 2013 of 25.000.
    • A. 

      The audit fee account (profit/loss) is debited 25.000

    • B. 

      The audit fee account (profit/loss) is credited 25.000

    • C. 

      The other creditors account (liability) is credited 25.000

    • D. 

      The trade creditors account (liability) is credited 25.000

    • E. 

      The trade creditors account (liability) is debited 25.000

    • F. 

      The transaction should no be included in the books for the fiscal year 2013

  • 3. 
    None posted purchase of new company car of 300.000 and none posted depreciations regarding this purchase. The expected scrap value is 60.000 while the depreciation period is 8 years. The purchase and delivery of the car was made 30.06.2013. The car was paid by transfer from the bank overdraft account. Straight line depreciations are used.
    • A. 

      The bank overdraft account (liability) is credited 300.000

    • B. 

      The bank overdraft account (liability) is debited 300.000

    • C. 

      The car account (asset) is credited 300.000

    • D. 

      The car account (asset) is debited 300.000

    • E. 

      The accumulated depreciation on car account (asset) is credited 37.500 while the depreciation on car account (profit/loss) is debited 37.500

    • F. 

      The accumulated depreciation on car account (asset) is credited 15.000 while the depreciation on car account (profit/loss) is debited 15.000

    • G. 

      The accumulated depreciation on car account (asset) is credited 30.000 while the depreciation on car account (profit/loss) is debited 30.000

  • 4. 
    None posted sale of the building and land and none posted depreciations. The sale was made as per 31.12.2013 at a sum of 1.000.000. The sales amount is in escrow as per 31.12.2013 in the bank deposit account until February 2014. Depreciation on building and land is 35.000 for 2013.
    • A. 

      The bank deposit account (asset) is debited 1.000.000 while the gain/loss on fixed asset account (profit/loss) is credited 1.000.000.

    • B. 

      The transaction should not be included in the books for the fiscal year 2013

    • C. 

      The bank deposit account (asset) is credited 1.000.000 while the gain/loss on fixed asset account (profit/loss) is debited 1.000.000.

    • D. 

      The accumulated depreciations on building account (asset) is credited 35.000 while the depreciations on buildings account (profit/loss) is debited 35.000

    • E. 

      The land and building account (asset) is credited 800.000 while gain/loss on fixed asset account (profit/loss) is debited 800.000

    • F. 

      The accumulated depreciations on building account (asset) is debited 20.000 while gain/loss on fixed asset account (profit/loss) is credited 20.000

    • G. 

      The accumulated depreciations on building account (asset) is debited 55.000 while gain/loss on fixed asset account (profit/loss) is credited 55.000

    • H. 

      The land and building account (asset) is debited 800.000 while gain/loss on fixed asset account (profit/loss) is credited 800.000

  • 5. 
    None posted disposal and depreciations on plant and machinery. Plant and machinery burned during a fire in the building as per 30.06.2013. The depreciation for the first 6 months of 2013 is 14.000. No insurance cover can be expected from the insurance company.
    • A. 

      The plant and machinery account (asset) is credited 75.000 while the gain/loss on fixed assets (profit/loss) account is debited 75.000

    • B. 

      The plant and machinery account (asset) is debited 75.000 while the gain/loss on fixed assets (profit/loss) account is credited 75.000

    • C. 

      The accumulated depreciations on plan and machinery account (asset) is debited 14.000 while the depreciations on plant and machinery account (profit/loss) is credited 14.000

    • D. 

      The accumulated depreciations on plan and machinery account (asset) is credited 14.000 while the depreciations on plant and machinery account (profit/loss) is debited 14.000

    • E. 

      The accumulated depreciations on plan and machinery account (asset) is debited 31.500 while the gain/loss on fixed assets account (profit/loss) is credited 31.500

    • F. 

      The accumulated depreciations on plan and machinery account (asset) is debited 17.500 while the depreciations on plant and machinery account (profit/loss) is credited 17.500

  • 6. 
    None posted depreciation on equipment is 6.000.
    • A. 

      The accumulated depreciations on equipment account (asset) is debited 6.000 while the depreciations on equipment account (profit/loss) is credited 6.000

    • B. 

      The accumulated depreciations on equipment account (asset) is credited 6.000 while the depreciations on equipment account (profit/loss) is debited 6.000

    • C. 

      The accumulated depreciations on equipment account (asset) is credited 6.000 while the gain/loss on fixed assets account (profit/loss) is debited 6.000

  • 7. 
    None posted new provision for bad debt is 17.000 as per 31.12.2013.
    • A. 

      The trade debtors account (asset) is credited 17.000 while the bad debt account (profit/loss) is debited 17.000

    • B. 

      The trade debtors account (asset) is credited 17.000 while the provision for bad debt account (asset) is debited 17.000

    • C. 

      The provision for bad debt account (asset) is credited 17.000 while the bad debt account (profit/loss) is debited 17.000

  • 8. 
    None posted cost of goods for Q4 is 75.000.
    • A. 

      The inventory account (asset) is credited 75.000 while the cost of goods sold account (profit/loss) is debited 75.000

    • B. 

      The inventory account (asset) is debited 75.000 while the cost of goods sold account (profit/loss) is credited 75.000

    • C. 

      The inventory account (asset) is credited 275.000 while the cost of goods sold account (profit/loss) is debited 275.000

    • D. 

      The inventory account (asset) is credited 350.000 while the cost of goods sold account (profit/loss) is debited 350.000

  • 9. 
    None posted impairment of inventory is 12.000. Due to items no longer good for sale.
    • A. 

      The inventory account (asset) is credited 12.000 while the cost of goods sold account (profit/loss) is debited 12.000

    • B. 

      The inventory account (asset) is debited 12.000 while the cost of goods sold account (profit/loss) is credited 12.000

  • 10. 
    None posted property tax covering Q4 2013 to Q1 2014 is 40.000. The payment was made from the overdraft account before 31.12.2013.
    • A. 

      The bank overdraft account (liability) is credited 40.000 while the premises expenses account (profit/loss) is debited 40.000

    • B. 

      The bank overdraft account (liability) is credited 40.000 while the prepaid expenses (asset) is debited 40.000

    • C. 

      The bank overdraft account (liability) is credited 40.000 while the premises expenses account (profit/loss) is debited 20.000 and the prepaid expenses (asset) is debited 20.000

  • 11. 
    None posted settlement the input and output VAT account to the VAT payable account.
    • A. 

      The input VAT account (liability) is debited 10.000 while the VAT payable account (liability) is credited 10.000

    • B. 

      The output VAT account (liability) is credited 56.000 while the VAT payable account (liability) is debited 56.000

    • C. 

      The output VAT account (liability) is debited 56.000 while the VAT payable account (liability) is credited 56.000

    • D. 

      The input VAT account (liability) is credited 10.000 while the VAT payable account (liability) is debited 10.000

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