Accounting Test Question IR No.1 On Incomplete Records

November 16th, 2006 Comments off
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Any change in capital structure will be influenced by any one or a combination of the following transactions, events or results:

  • introduction of capital;
  • drawings; and/or
  • trading profits or losses.

By using the accounting equation, and given the values of opening and closing capital together with drawings and the amounts of any capital introductions, the value of profit or loss can be determined.

Accounting Test Question IR No. 1
Mr. A’s financial details for the years ended 2004 and 2005 showed:

2004

2005

Assets:

Motor Vehicle

6,500

5,500

Equipment

2,500

2,000

Stock

750

1,650

Cash at Bank

900

1,300

10,650

10,450

Less Creditors

750

650

$9,900

$9,800

Mr A’s drawings for the year were $10,650. He had sold some shares for $1,050, the proceeds of which he had paid into his business bank account. Show the profit for the year 2005 of Mr. A.

[ Refer Answer ]

 

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Financial Accounting

 
 

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