WAEC Financial Accounting 2012 Question 34

Question 34

Public Sector Accounting

Use the following information to answer questions 34 and 35.
The Health Department of Zango Local Government incurred the following expenditure in 2010:
Construction of hospital wards: Le 300,000
Purchase of hospital beds: Le 40,000
Salaries and wages: Le 80,000
Purchase of drugs: Le 55,000
Purchase of X-ray machine: Le 150,000
Capital expenditure for the year was

  1. A.Le 545,000
  2. B.Le 490,000
  3. C.Le 450,000
  4. D.Le 300,000
Show the answer and explanation

Answer: B (Le 490,000)

Explanation

Capital items last for years: wards 300,000 + beds 40,000 + X-ray machine 150,000 = Le 490,000.