ZIMSEC O Level Principles of Accounting: Single entry and Incomplete records: Example 2

  • Our first example on this topic was relatively straight forward
  • We will now look at a more challenging and comprehensive example
  • On how to create Financial Statements in cases where only single entry and incomplete records are kept

The Question

William Sachikonye runs a second-hand furniture business from a shop which he rents. He does not keep complete accounting records, but is able to provide you with the following information about his financial position at 1 April 20X8: Stock of furniture $3,210; Trade debtors $2,643; Trade creditors $1,598; Motor vehicle $5,100; Shop fittings $4,200; Motor vehicle expenses owing $432.
He has also provided the following summary of his bank account for the year ended 31 March 20X9:

Balance at 1 Apr 20x82 420Payments of trade creditors22 177
Cheques received from Trade Debtors44 846Electricity1 090
Cash sales3 921Telephone360
Rent2 000
Advertising1 430
Shop fittings2 550
Motor vehicle expenses2 116
Drawings16 743
Balance at 31 March 20x91 775

51 187

51 187

All cash and cheques received were paid into the bank account immediately.
You find that the following must also be taken into account:

  • Depreciation is to be written off the motor vehicle at 20% and off the shop fittings at 10%, calculated on the book values at 1 April 20X8 plus additions during the year
  • At 31 March 20X9 motor vehicle expenses owing were $291 and insurance paid in advance was $177.
  • Included in the amount paid for shop fittings were:
    a table bought for $300, which William resold during the year at cost,
    some wooden shelving (cost $250), which Smithson used in building an extension to his house.

Other balances at 31 March 20X9 were:

  • Trade Debtors $4 012
  • Trade Creditors $2 445
  • Stock of furniture $4 063


  1.  For the year ended 31 March 20X9
    1. calculate William’s sales and purchases,
    2. prepare his trading and profit and loss account.
  2. Prepare William’s balance sheet as at 31 March 20X9.


To access more topics go to the Principles of Accounting Notes.