Professional Documents
Culture Documents
Book-keeping
Level 1
Model Answers
Series 4 2009 (1017)
Model Answers have been developed by EDI to offer additional information and guidance to Centres,
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Page 1 of 11
QUESTION 1
Jason Booth extracted the following list of balances from his books at 31 March 2009:
£
Bad debts 1,800
Drawings 17,700
4% loan 36,000
Sales 325,500
Purchases 235,800
Discounts allowed 7,800
Wages 21,000
Discounts received 10,200
Creditors 80,400
Debtors 157,200
Bank – overdrawn 15,600
Cash 4,800
Stock at 1 April 2008 71,200
Insurance 4,600
Rent 15,000
Fixtures and fittings 22,000
Returns outwards 2,800
Capital ?
REQUIRED
(b) State the six types of error which do not affect the agreement of the Trial Balance.
(6 marks)
(Total 25 marks)
1017/4/09/MA Page 2 of 11
MODEL ANSWER TO QUESTION 1
(a)
(b)
Omission
Commission
Original Entry
Compensating
Reversal
Principle
1017/4/09/MA Page 3 of 11
QUESTION 2
Trudy Purcell maintains a Petty Cash Book on the imprest system, the imprest being £200.
On Monday 1 June 2009 the balance of petty cash was £23.40. The imprest is restored each Monday
at the start of business.
2009 Details £
June 2 Creditor – K Cole 25.60
June 2 Stationery 28.90
June 3 Postage 12.60
June 3 Cleaning 35.80
June 4 Stationery 12.36
June 5 Postage 13.24
June 5 Creditor – M Lee 18.39
The last Petty Cash Book voucher to be used on 29 May 2009 was number 1037.
Stationery
Postage
Cleaning
Ledger
REQUIRED
(a) (i) Prepare the Petty Cash Book for the week ended Friday 5 June 2009
(ii) Balance the Petty Cash and bring the balance down to the week commencing
Monday 8 June 2009.
Dan Bosworth purchased a machine at a cost of £10,200 from Green Equipment on 1 April 2007. He
paid a deposit of £1,100 by cheque and agreed to pay the balance on 1 May 2007.
The machine is expected to have a useful life of four years and disposal value of £600. Equal
amounts of depreciation will be charged each year.
REQUIRED
Prepare for the financial years ended 31 March 2008 and 2009 the:
(Total 25 marks)
1017/4/09/MA Page 4 of 11
MODEL ANSWER TO QUESTION 2
(a)
(i) and (ii)
1017/4/09/MA Page 5 of 11
MODEL ANSWER TO QUESTION 2
(b)
Machinery Account
2007 £ 2008 £
April 1 Bank 1,100 March 31 Balance c/d 10,200
April 1 Green Equipment 9,100 ………
10,200 10,200
2008 2009
April 1 Balance b/d 10,200 March 31 Balance c/d 10,200
2009
April 1 Balance b/d 10,200
1017/4/09/MA Page 6 of 11
QUESTION 3
On 30 April 2009, the Cash Book of Amy Clark showed a balance at the bank of £2,140 (Dr). The
bank statement received on 30 April 2009 revealed the following:
(1) A cheque, £360, paid to D Ford, a creditor, was entered in the Cash Book as £630.
(3) On 12 April 2009 a cheque was received from L Bloor, a debtor, for £523. The cheque was
dishonoured on 15 April 2009. No entry for the dishonour has been made in the Cash Book.
(4) A Direct Debit payment for electricity, £213, had not been entered in the Cash Book.
(5) On 29 April a cheque for £427 received from J Marshall, a debtor, was paid into the bank. The
bank did not credit this until 2 May 2009.
(6) The following cheques had not been presented to the bank for payment:
REQUIRED
(a) Starting with the balance of £2,140 (Dr), bring the bank column of the Cash Book up to date at
30 April 2009.
(9 marks)
On 30 January 2009, J Durrant received a cheque from D Lay for £627. This represented a debt,
which had been written off as a bad debt on 1 January 2008. J Durrant’s financial year ends on
31 March 2009.
REQUIRED
(c) Prepare Journal entries to record the recovery of the debt. Narratives are not required.
(5 marks)
(Total 25 marks)
1017/4/09/MA Page 7 of 11
MODEL ANSWER TO QUESTION 3
(a)
Cash Book (Bank Columns)
2009 £ 2009 £
April 30 Balance b/d 2,140 April 30 Bank charges 57
April 30 D Ford 270 April 30 L Bloor 523
April 30 Electricity (light and heat) 213
…….. April 30 Balance c/d 1,617
2,410 2,410
May 1 Balance b/d 1,617
(b)
Amy Clark
Bank Reconciliation Statement at 30 April 2009
£ £
Balance as per Cash Book 1,617
(c)
Dr Cr
2009 £ £
Jan 30 Bank 627
D Lay 627
D Lay 627
Bad Debts Recovered 627
1017/4/09/MA Page 8 of 11
QUESTION 4
On 1 October 2009 Benny Xu had the following Purchases Ledger Account balances:
£
P Wang 6,120
M Gao 12,400
T Hong 5,200
REQUIRED
On 29 October Benny Xu paid cheques to his creditors in full settlement of the amounts owing on
1 October 2009. M Gao allowed a discount of 2½% and T Hong allowed a discount of 1½%.
P Wang allowed no discount on his balance.
REQUIRED
(b) Prepare the ledger accounts of P Wang, M Gao and T Hong for October 2009.
(c) Balance the ledger accounts in (b) above and bring the balances down to 1 November 2009.
(17 marks)
(Total 25 marks)
1017/4/09/MA Page 9 of 11
MODEL ANSWER TO QUESTION 4
(a)
(i)
Purchases Day Book
Date Supplier £
2009
Oct 1 C Nassif (7,400 – 1,110) 6,290
Oct 8 P Wang (5,340 – 534) 4,806
Oct 15 M Gao (12,600 –2,520) 10,080
Oct 22 T Hong (22,940 – 5,735) 17,205
38,381
(ii)
Returns Outwards Day Book
Date Supplier £
2009
Oct 14 P Wang (660 – 66) 594
Oct 28 T Hong (2,200 – 550) 1,650
2,244
P Wang account
2009 £ 2009 £
Oct 14 Returns 594 Oct 1 Balance b/d 6,120
Oct 29 Bank 6,120 Oct 8 Purchases 4,806
Oct 29 Balance c/d 4,212 ………
10,926 10,926
Nov 1 Balance b/d 4,212
M Gao account
2009 £ 2009 £
Oct 29 Bank 12,090 Oct 1 Balance b/d 12,400
Oct 29 Discount 310 Oct 15 Purchases/PDB 10,080
Oct 29 Balance c/d 10,080 ………
22,480 22,480
Nov 1 Balance b/d 10,080
T Hong account
2009 £ 2009 £
Oct 28 Returns 1,650 Oct 1 Balance b/d 5,200
Oct 29 Bank 5,122 Oct 22 Purchases/PDB 17,205
Oct 29 Discount 78
Oct 29 Balance c/d 15,555 ………
22,405 22,405
Nov 1 Balance b/d 15,555
1017/4/09/MA Page 10 of 11
For Question 2 (a) Candidate No:………………………..
Centre No:……………………………
Petty Cash Book
Receipts Date Details Voucher Total Analysis Columns
number
£ £ £ £ £ £ £