A local government department's cash book shows an opening cash balance of $\text{₦}150,000$. During the year cash receipts total $\text{₦}420,000$ and cash payments total $\text{₦}380,000$. An audit later discovers that a cash receipt of $\text{₦}12,000$ was recorded twice and a cash payment of $\text{₦}5,000$ was omitted. At year‑end the department also records (i) accrued salaries expense of $\text{₦}25,000$ (not yet paid) and (ii) revenue received in advance of $\text{₦}30,000$ for services to be delivered next year. Assuming no other errors, what is the corrected cash surplus for the year and the cash balance at the end of the year?

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Accepted Answer

Corrected cash surplus = $\text{₦}23,000$; year‑end cash balance = $\text{₦}173,000$.

Gce Model Questions Vol1 2025 Financial Accounting Question 36

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