Neco 2021 Financial Accounting Question 46

A local government council has the following opening balances (in ₦): Cash 500,000; Accounts receivable 200,000; Inventory 150,000; Accounts payable 120,000; Accrued expenses 30,000; Capital assets (cost) 800,000. Depreciation is charged at \(10\%\) per annum on a straight‑line basis. During the year the following transactions occur:\n1. Collected cash from receivables amounting to 180,000.\n2. Purchased inventory on credit for 100,000.\n3. Paid salaries cash of 90,000; salaries for the last month amounting to 10,000 remain unpaid at year‑end.\n4. Received a cash grant of 250,000, of which 50,000 is restricted to a special community development fund.\n5. Transferred 40,000 from general cash to the special fund (restricted cash).\n6. Sold equipment (original cost 100,000; accumulated depreciation 30,000) for cash of 80,000.\nDetermine:\n\(a\) the closing cash balance at year‑end;\n\(b\) the total depreciation expense for the year;\n\(c\) the net financial position (total assets minus total liabilities) at year‑end.