Neco 2017 Financial Accounting Question 5

Practice essay / theory question 5 from the 2017 Neco Financial Accounting examination. This question covers Trial Balance .

Neco 2017 Financial Accounting Essay / Theory

Topic: Trial Balance

Question 5 NECO • 2017 • FINANCIAL_ACCOUNTING • essay

The following ledger balances are extracted after posting all transactions for the year. Prepare a trial balance and comment on any imbalance. Ledger balances (₦): - Cash – Debit 45,000 - Trade Receivables – Debit 30,000 - Inventory – Debit 25,000 - Equipment – Debit 50,000 - Accumulated Depreciation – Equipment – Credit 15,000 - Trade Payables – Credit 20,000 - Loan Payable – Credit 40,000 - Capital – Credit 70,000 - Sales Revenue – Credit 80,000 - Cost of Goods Sold – Debit 45,000 - Rent Expense – Debit 12,000 - Salaries Expense – Debit 18,000 - Miscellaneous Expense – Debit 5,000

( a )

Prepare the trial balance showing the total of debit balances and the total of credit balances.

( b )

State the amount of difference and indicate whether the debit side exceeds the credit side or vice‑versa.

( c )

Suggest one plausible error that could have caused the imbalance and show the adjusting entry that would correct the trial balance.

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This is Neco 2017 Financial Accounting Question 5. It is one of the essay questions from the 2017 Neco Financial Accounting examination.

The question covers Trial Balance .

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