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, 7 th October 2011 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 6 printed pages.

SECTION A (20 Marks) Answer all questions in this section. 1. For each of the items (i) - (x) choose the correct answer from among the given alternatives and write its letter beside the item number. (i) If opening capital is 412,500/=, closing capital is 283,750/= and drawings is 82,500/=, then: A loss for the year is 46,250/= B profit for the year is 46,250/= C loss for the year is 211,250/= D profit for the year is 211,250/= E profit for the year is 128,750/=. (ii) A receipt and payment account is used to A calculate the gross profit B calculate the net profit C show the opening and closing cash balances D show the surplus of income over expenditure E show accrued and pre-paid expenses. (iii) The correct method of calculating cost of goods sold is A closing stock + purchases - opening stock B opening stock + closing stock - purchases C closing stock + purchases + opening stock D opening stock - purchases + closing stock E opening stock + purchases - closing stock. (iv) If we take goods for personal use we should debit A drawings account, credit purchases account B purchases account, credit drawings account C drawings account, credit stock account D sales account, credit stock account E supplier, credit owners. (v) A cheque paid by the business owner that is in possession of payee but not yet deposited with the bank is called A standing order B dishonoured cheque C unpaid cheque D unpresented cheque E drawer’s cheque. (vi) Given a cash float of 200,000/=, if 146,000/= is spent in the period, how much will be reimbursed at the end of that period? A 200,000/= B 52,000/= C 54,000/= D 346,000/= E 146,000/=. (vii) If trial balance totals do not agree, the difference must be entered in A the profit and loss account B a suspense account C nominal account D the capital account E the cash account.

(viii) Given the cost of goods sold is 320,000/= and margin of 20%, then the sales figure is A 413,280/= B 256,000/= C 430,500/= D 400,000/= E 328,000/=. (ix) Discount received is A deducted when we receive cash B given by us when we sell goods on credit C deducted by us when we pay our account D not recorded at all E given by us to customers. (x) When Mussa makes out a cheque for 50,000/= and sends it to Joseph, then Mussa is known as A the payee B the banker C the drawee D the creditor E the drawer. 2. Match the items in Column A with the responses in Column B by writing the letter of the correct response beside the item number. Column A Column B (i) Consists of the entire revenue and expenditure for a particular financial year of the government. A B Warrant of funds Development budget (ii) Entries recorded in the vote book which indicates indents, requisitions and local purchase orders. C Commitments (iii) Expenditure of capital nature. D Token vote (iv) Income of government from loans and grants that is paid into the consolidated fund. E F Vote book Recurrent revenue (v) The amount of money added to the expenditure item to obtain the approval of the Parliament. G Development expenditure (vi) Expenditure which do not add value to the Government. H Consolidated funds (vii) The day to day running expenses of government. I Authorized officer (viii) Income of the government from taxes licenses and duties. J Approved estimates (ix) A letter issued by the accounting officer covering authority for specific expenditure. K L Recurrent expenditure Nugatory expenditure (x) A record used for proper control of expenditure against the provision of funds. M N Development revenue Virement O Payment voucher

SECTION B (20 Marks) Answer all questions from this section. 3. (a) A book keeper prepared a Trial Balance on 31/03/2003 which showed a difference of sh. 140 (Excess credit). The difference was placed to suspense account. The following errors were subsequently located: ■ A sale of goods to Bizimungu for sh. 600 had been posted to the wrong side of his account. ■ A credit purchase of goods for sh. 1,640 from Ramson had been posted to the personal account as sh. 640. ■ A cash sale of old furniture for sh. 1,500 had been passed through the sales account. ■ The discount received account had been under cast by sh. 60. ■ Payment of rent sh. 3,400 was debited to the personal account of the landlord. Pass journal entries to rectify the errors and prepare the suspense account. (b) (i) What is meant by bank reconciliation statement? (ii) From the following particulars, draw up a bank reconciliation statement: - 31 st December 2005 Cash book balance at bank sh. 12390 31 st December 2005 Bank statement balance at bank sh. 11520 ■ Cheques issued and entered in teh cash book but not presented for payment sh. 2520 ■ Cheques received and paid into bank but not yet credited by bank sh. 3240 ■ Bank charges sh. 150 4. Briefly explain the following terms; (a) Creditors (b) Business entity concept (c) Trading account (d) Depreciation (e) Accrual concept.

SECTION C (60 Marks) Answer all questions in this section. 5. Following is the Receipts and Payments Account of Chilindima Social Club for the year ended December 31 st 2007: Receipts Amount Payments Amount Balance b/f: Salaries: Cash 2,000 Secretaries 6,000 Bank 12,000 14,000 Staff 5,000 11,000 Subscription Canteen expenses 12,000 For 2006 500 Miscellaneous expenses 2,500 For 2007 5,500 Construction of building 15,000 For 2008 400 6,400 Balance c/f: Interest from bank 1,000 Cash 1,300 Sale proceeds of old newspaper 400 Bank 4,000 5,300 Sale of old furniture 2,000 Canteen collection 12,000 Donation for Building Fund 10,000 45,800 45,800 Which the additional information given below, prepare the Income and Expenditure Account, Subscription Account for the year ended 31 st December 2007 and the Balance sheet as at that date. December 31 st 2006 Sh. December 31 st 2007 Sh. (a) Subscription receivable 1,000 600 (b) Subscription received in advance 200 400 (c) Outstanding salary for staff 1,000 2,000 (d) Canteen expenses prepaid 1,000 1,500 (e) Furniture at book value 14,000 ? (f) Buildings 15,000 ? (g) Fixed deposit with bank 10,000 10,000 (h) Book value of furniture sold during 2007 was sh. 3,500. (i) Charge depreciation on furniture at 10 percent per annum on the closing balance. 6. (a) A machine was bought for sh. 900,000. It was expected to be useful for 3 years. You are required to calculate depreciation expenses for three years of its use. Use the sum of years’ digits method for your calculations. Prepare provision for depreciation and machine accounts for the three years.

(b) Show how the following transactions will be recorded in the capital accounts of the partners Tenga and Natengile when their capitals are fluctuating: Tenga Natengile Sh Sh Capital on 1.1.2002 400,000 300,000 Drawings during 2002 50,000 30,000 Interest on capitals 5% 5% Interest on drawings 1,250 750 Share of profit for 2002 60,000 50,000 Partner’s salary 36,000 - Commission 5,000 3,000 7. Mother Teressa Charitable Association does not maintain her books in the double entry system. From the following information, prepare Trading, Profit or Loss Account and Balance Sheet as at March 31 st 2003. Stock 31.3.2002 Sh 19,800 31.3.2003 Sh 113,200 Creditors 31,000 14,500 Debtors 118,000 125,000 Premises 90,000 90,000 Furniture 11,000 11,500 Air conditioner 15,000 15,000 Creditors as at 31.3.2002 include Sh 15,000 for purchase of Air conditioner. Cash transactions: Cash as at April 1, 2002 15,000 Collections from customers 160,800 Payment to creditors 144,000 Rent, rates and taxes 112,000 Sundry expenses 18,000 Sundry income 16,500 Drawings by Mother Teressa 30,000 Loan from Mrs. Fernanders 23,000 Capital introduced 12,000 Cash sales 11,500 Cash purchases 15,000 Payments to creditors for Air conditioner 15,000 Bad debts written off 1,200