QUESTION ONE
(a) Briefly explain the following terms as used in the accounts of professional practitioners:
Office account
Client account
Costs charged to clients
Work-in-progress.
(b) Given below is a trial balance extracted from the books of Kamau and Nyambati, a firm of practicing advocates as at 31 October 2002:
Kamau and Nyambati Advocates
|
Sh.
|
Sh.
|
|
Capital account
Disbursements on behalf of clients
Drawings
Salaries
Rent and rates
Printing and stationery
Postage and telephone
Costs charged to clients
Work in progress on 1 November 2001
Clients: for the moneys held on their behalf
Creditors
Debtors
Sundry office expenses
Furniture, fittings and library books
Cash at bank:
Clients' account
Office account
|
12,000
60,000
72,000
60,000
35,000
18,200
36,800
78,000
8,500
45,000
24,800
55,700
|
204,000
250,000
24,800
27,200
______
|
|
506,000
|
506,000
|
Additional information:
The uncompleted work on 31 October 2002 was valued at Sh.23,500.
It is estimated that debts amounting to Sh.5,500 are uncollectible and should be written off.
Depreciation should be provided at 20% per annum on the book value of the furniture, fittings and library books.
Required:
(a) Profit and loss account for the year ended 31 October 2002.
(b) Balance sheet as at 31 October 2002.