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WAEC Financial Accounting 2013 Question 20

Question 20

Incomplete Records

Use the following information to answer questions 20 and 21.
Creditors: 1/6/2011 D2,495; 30/5/2012 D2,285
Debtors: 1/6/2011 D1,215; 30/5/2012 D2,145
Cash paid to creditors: D32,170
Cash received from customers: D40,650
Goods returned to suppliers: D500
Purchases for the year is

  1. A.D32,880
  2. B.D32,780
  3. C.D32,460
  4. D.D31,960
Show the answer and explanation

Answer: C (D32,460)

Explanation

Purchases = cash paid + returns + closing creditors − opening creditors = 32,170 + 500 + 2,285 − 2,495 = D32,460.