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JAMB Principles of Accounts 1997 Question 10

Question 10

Cash Book

Bank Account
Debit (₦): Capital 50 000; Sales 38 500
Credit (₦): Purchases 20 000; Rent 2 590; Motor vehicles 6 500
What is the balance of the bank account shown above?

  1. A.₦88 500 debit
  2. B.₦88 500 credit
  3. C.₦59 410 credit
  4. D.₦59 410 debit
Show the answer and explanation

Answer: D (₦59 410 debit)

Explanation

Debits = 50 000 + 38 500 = 88 500. Credits = 20 000 + 2 590 + 6 500 = 29 090. Balance = ₦59 410 debit (money in the bank).