THE UNITED REPUBLIC OF TANZANIA NATIONAL EXAMINATIONS COUNCIL CERTIFICATE OF SECONDARY EDUCATION EXAMINATION 062 BOOK KEEPING (For Both School and Private Candidates) Time: 3 Hours Friday, 8 th October 2010 p.m. Instructions 1. This paper consists of sections A, B and C. 2. Answer all the questions. 3. Calculators are not allowed in the examination room. 4. Cellular phones are not allowed in the examination room. 5. Write your Examination Number on every page of your answer booklet(s). This paper consists of 8 printed pages.

SECTION A (20 Marks) Answer all questions in this section. 1. (i) Which of the following is not a factor that may cause capital to change? A Additional investment B Profits C Drawings D Purchases E Losses. (ii) The sum of fixed assets and working capital of a business is called A capital owned B capital employed C circulating capital D working capital E borrowed capital. (iii) The trial balance totals should agree because A it is extracted at the year end B for every debit there must be a corresponding credit C it is a list of balances D errors in balancing the ledger accounts are found out E it is an account. (iv) When John writes a cheque and sends it to James then James is A drawer B drawee C payer D payee E receiver. (v) A credit balance of 500,000/= in the cash column of the cash book means A we have spent more than we have received B we have spent less than we have received C the bookkeeper has stolen 500,000/= D we have 500,000/= cash in hand E the bookkeeper has made a mistake. (vi) At the end of the financial year, bad debts account is closed by a transfer to the A profit and loss account B balance sheet C trading account D account of expected bad debts E allowance for doubtful debts account.

(vii) Credit notes issued by a firm will be entered in its A purchases returns account B sales returns account C sales account D sales returns journal E purchases returns journal. (viii) Discounts allowed are A deducted by the business when it pays cash B deducted by the business when it receives cash C given by the business when it sells goods on credit D received by the business when it buys in bulk E given to those who buy larger quantities from the business. (ix) Which among the following is not a source document? A Remittance advice notes B Payment vouchers C Cash sales slip D Sales journal E Debit notes. (x) A cheque issued but not yet passed through the banking system is called: A postdated cheque B dishonoured cheque C stale cheque D unpresented cheque E uncredited cheque.

2. Match the responses in List B with the statements in List A by writing the letter of the correct response beside the item number. List A List B (i) A list of debit and credit balances and extracted from the ledger. (ii) The main book of account in which all accounts are recorded. (iii) Charges made by the bank to cover expenses of handling the account. (iv) Goods sent to an agent for sale. (v) The process of taking raw materials provided by nature and turning them into more sophisticated and useful products. (vi) The accounting term for declining value of fixed assets due to wear and tear in the process of production over a given time. (vii) A document issued by a seller when goods are purchased on credit. (viii) An accounting system where records of only part of the transactions are available. (ix) An account kept by the central Bank (BoT) where all the government revenues and records are kept. (x) The amount of capital available for running a business. A Incomplete records B Bank charges C Depreciation D Journal proper E An invoice F Working capital G Exchequer Account H Manufacturing I Ledger J Consignment K Trial Balance L Circulating capital M Account sale N Balance sheet O Bank expenses P Treasury account Q Constructing R Proforma invoice S Half yearly records T Depletion

SECTION B (20 Marks) Answer all questions from this section. 3. Write short notes on the following terms: (a) Nugatory expenditure (b) Virement (c) Collector of revenue (d) Civil contingency fund (e) Paymaster general (PMG) 4. On 1 st of January, 2000 Masantula started up a new business. During the year ended 31 st December, 2000 the following debtors were found to be bad and were written off on the dates indicated below; Shs. 10.03.2000 Shelukindo 88,000 30.05.2000 Shemaombe 51,200 31.08.2000 Shekidele 9,600 On 31 st December, 2000, the schedule of debtors amounted to shs. 5,480,000 and after an examination it was decided to make a provision for doubtful debts of shs. 176,000. Prepare the: (a) Bad debts account. (b) Provision for bad debts account. (c) Balance sheet extracts showing how debtors are displayed as on 31 st December, 2000.

SECTION C (60 Marks) Answer all questions in this section. 5. On 5 th March 2004, A. Mwakyusa of Mbeya consigned 1,000 units of goods to C. Omari of Zanzibar, the cost price of which was sh. 800,000. A. Mwakyusa paid the following expenses: Carriage sh. 200,000 Marine insurance Freight sh. sh. 80,000 90,000 On 30 th June, 2004 C. Omari sent an account sales to A. Mwakyusa, showing that 600 units were sold for sh. 1,200,000 and he incurred the following expenses: Carriage sh. 150,000 Import duty sh. 45,000 Storage sh. 50,000 Commission sh. 80,000 Sales expense sh. 5,000 Required: Record the above transactions in the books of the consignor, showing the calculations of the unsold stock.

6. Mvumi Consumers Cooperative shop has three departments (Butter and eggs, Poultry and beef, and Bottled goods). The members desired to know the performance of each department for the financial year ending 31 st December, 1983. From the following list of balances you are required to prepare a Departmental Trading and Profit and Loss account in columnar form. Shs. Rent and rates 2,100 Delivery expenses 1,200 Commission 1,920 Purchases Butter and eggs 26,400 Poultry and beef 21,800 Bottled goods 17,400 65,600 Discount received 984 Salaries and wages 15,750 Advertising 600 Sales Butter and eggs 40,000 Poultry and beef 32,000 Bottled goods 24,000 96,000 Depreciation 1,470 Opening stock Butter and eggs 7,300 Poultry and beef 5,620 Bottled goods 4,560 17,480 Administration and general expenses 3,945 Closing stock Butter and eggs 6,200 Poultry and beef 4,327 Bottled goods 4,873 15,400 NOTE: With the exception of the following, expenses are to be apportioned equally amongst the departments. (a) Delivery expenses, proportionate to sales. (b) Commission, 2% of sales. (c) Salaries and wages, and Insurance, in the proportional of 6:5:4 respectively. (d) Discount received, 1.5% of purchases. (e) Other expenses like depreciation, rent and rates, advertising, as well as administration and general expenses should be allocated equally in all departments.

7. The following is a Trial Balance extracted from the books of a sole proprietor, S.M. Nondo, as at 31 st December 1999. S. M. NONDO Balance sheet as at 31 st December 1999 NAME OF ACCOUNT DR. Shs. CR. Shs. Stock 1 st January 1999 50,000 Freehold Premises 240,000 Bills Receivable 30,000 Purchases 280,000 Salaries and Wages Sales Fixtures and Fittings 35,000 25,000 520,000 Discount Allowed Discount Received Plant and Machinery 7,500 140,000 4,500 Rates 5,600 Advertising 10,400 Insurance 3,800 General Expenses Provision for Bad Debts Sundry Debtors Bills Payable 7,200 60,000 1,800 15,000 Sundry Creditors Cash in Hand Bank Overdraft Drawings Capital Account 2,400 6,000 43,000 18,600 300,000 902,900 902,900 The following additional information is provided: (a) Make a Provision for depreciation of plant and machinery at 10% p.a. and fixtures and fittings at 15% p.a. (b) Increase the provision for bad debts to an amount equal to 4% of sundry debtors. (c) Prepaid insurance amounts to 500/=. (d) Rates accrued 400/=. (e) Closing stock was 60,000/=. (f) During the year Mr. S.M. Nondo took goods worth 2,000/= for his personal use. Required: Prepare trading and profit and loss account for the year ending 31 st December, 1999 and a balance sheet as at that date.