Day: December 21, 2019

A sole trader rents the premises from which he operates and does not pay or receive any other rent.

On 1 January 1995 the rent account in his ledger showed accrued rent payable of £2,500.

During 1995 the trader paid rent totalling £12,750 including all bills in respect of 1995 and one bill for £3,750 in respect of the three months ended on 31 January 1996.

The charge for rent, in the profit and loss account for 1995 was:

Select ONE answer:

1. £9,000
2. £11,500
3. £12,750
4. £14,000

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct
   Dr Bank £12,750
   Cr Balance b/d £2,500
   Cr Profit and Loss £9,009
   Cr Balance c/d (£3,750 / 3 prepaid) £1,250
   Total £12,750
2. Not correct
3. Not correct
4. Not correct

 

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