Principles Of Accounts 2017 Jamb Examination

A pay-in-slip (also known as a deposit slip) is the primary source document used by a firm to record the deposit of cash or cheques into its bank account. It provides immediate evidence of the transaction and is used to make entries in the bank column of the cash book.

The Receipts and Payments account is a summary of the cash book (IV). It records all cash received and paid, regardless of whether it is for revenue or capital purposes (III). While it records the cash paid for liabilities (II), it does *not* record subscriptions in arrears (I), as those are non-cash accruals that only appear in the Income and Expenditure account.

When a head office sends inventory to one of its branches, it is recorded as 'Goods Sent to Branch'. In the head office books, this is treated similarly to a sale or an 'issue' from its own stock to the branch's stock to maintain inventory control, though no actual third-party sale has occurred yet.

The primary objectives of branch accounting are to monitor performance and maintain control. Allowing fraud and wastage is a failure of internal control systems and is the opposite of why these accounts are maintained.

Credit allows businesses to acquire goods and services immediately while paying for them later. This expansion of purchasing power is a major driver of growth in trading volumes, as it facilitates larger transactions than would be possible if every deal required physical cash upfront.

The Income and Expenditure account for a non-profit is the equivalent of a Profit and Loss account for a commercial firm. Both accounts follow the accrual basis of accounting to determine the financial result of the period (Surplus/Deficit vs. Profit/Loss).

Discounts received are generally related to purchases. If ₦24,000 was received for ₦150,000 of purchases in Dept A, we find the rate: \[ \text{Rate} = \frac{24,000}{150,000} = 0.16 \text{ or } 16\% \]Applying this same rate to Dept B's purchases: \[ \text{Discount B} = 250,000 \times 0.16 = 40,000 \]*(Note: If the ratio is Dept A:B (3:5 based on 150k:250k), and 24k is for A, then B = 24k / 3 * 5 = 40,000)*.

FIFO (First-In, First-Out) assumes that the oldest stock is sold first. This typically mirrors the actual physical flow of perishable or dated goods in a warehouse, making it a logical and realistic approach to inventory valuation.

Discount allowed is a reduction in price granted by a seller to their customers to encourage early payment of debts. Therefore, it is the customers who enjoy the benefit of the reduced payment.

Discount allowed is apportioned based on Sales. Total Sales = 250,000 + 150,000 = 400,000. Ratio for Dept A = 250,000 / 400,000 = 5/8.
Applying this to a total discount (assuming ₦24,000 total based on standard exam patterns for this table): \[ \text{Dept A} = \frac{5}{8} \times 24,000 = 15,000 \]