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WAEC Financial Accounting 2010 Question 45

Question 45

Accruals and Prepayments

Use the following information to answer questions 45 and 46.
On 1/7/07, a trader owed wages of Le 2,000. During the year ended 30/6/08, wages of Le 2,400 were owed and Le 8,000 were paid.

The wages of the year ended 30/6/08 is

  1. A.Le 12,400
  2. B.Le 8,400
  3. C.Le 8,000
  4. D.Le 7,600
Show the answer and explanation

Answer: B (Le 8,400)

Explanation

Paid 8,000 − owed at start 2,000 + owed at end 2,400 = Le 8,400.