Financial Management and Accountancy (GSDR3113)
Higher Institute of Transport and Logistics (HITL)
Semester: First Semester
Level: 300
Year: 2019
REPUBLIC OF CAMEROON THE UNIVERSITY OF BAMENDA
Peace-Work-Fatherland P. O Box 39 Bambili
School/Faculty: HITL Department: General Studies Lecturer(s): Dr Mukah Samuel T
Level: 300 Semester: First Academic Year: 2018/2019
Course Code: GSDR 313 Course Title: Financial management and Accounting
Date: 12 /03/2019 Hall: Time: 2hrs
Instructions: Answer Question 1 and any other Question. In all, answer two questions. Start Each on
a new page, Show all workings.
Question 1 (40 marks)
Palmer Co. Ltd has the following assets and liabilities as on 24
th
December 2018: Creditors
£2,800; Equipment £6,200; Car £7,300; Stock of goods £8,100; Debtors £4,050; Cash at
bank £9,100; Cash in hand £195.
You are not given the capital amount at that date.
During the last week of December 2018 the following transactions took place:
(a) Palmer Co. Ltd bought extra equipment on credit for £110.
(b) Palmer Co. Ltd bought extra stock by cheque £380.
(c) Palmer Co. Ltd paid creditors by cheque £1,150.
(d) Debtors paid Palmer Co. Ltd £640 bv cheque and £90 by cash.
(e) Palmer Co. Ltd put in an extra £1,500 into the business, £1,300 by cheque and £200 in
cash.
Required:
a)
Draw up the necessary accounts to complete the above transactions. 10 marks
b)
Prepare a Trial balance as at 31
st
December 2018 3 marks
Balance Sheet as at
31
st
December 2018
£ £ £ £
Long Term assets
Land and Buildings
Furniture and fittings
Equipment
Motor vehicles
Sub total
Capital x
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Short term assets
Liabilities
r
X
Stock
X
Debtors
Bank
X
Cash
Sub total
X
X
XX
Total Assets
xxxx
xxxx
Question 2 (30 marks)
a)
What is inventory? 1 mark
b)
Describe the accounting procedures for issuing inventory using:
•
Materials requisition notes
•
Materials returned notes
•
Materials transfer notes 6 marks
c)
Mukah and Sons Co. Ltd located in Njembeng is a manufacturing concern of clay pots.
You are given the data below for the year just ended: The opening balance of materials held
in inventory, 300,000 frs
i.
Credit purchases, 400,000 frs
ii.
Materials returned to stores, 50,000 frs
iii.
Direct materials used in production, 250,000 frs
iv.
Materials returned to suppliers, 20,000 frs
v.
Indirect materials transferred to production account, 25,000 frs
vi.
Material write-offs, 30,000 frs
Required: Draw up a Material inventory account. What is the closing balance of the materials
inventory? 8 marks
Question 3 (30 marks)
Costs may be classified:
•
By element
•
By function (production and non-production costs)
•
As direct and indirect costs
•
Fixed and variable costs
With examples, explain each of these classifications
Question 4 (30 marks)
a)
Explain the meaning and relevance of ratio analysis. 10 marks
b)
Attempt a categorization of ratios, giving 2 examples of ratios in each category 20 marks
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