O Level Accounting (7707)•7707/12/O/N/23
Explanation
Accrual accounting requires adjusting payments for opening and closing balances to find the true expense.
Steps:
- Identify opening liability for electricity at start of 2022: not provided (credit balance given at 1 Jan 2023 suggests closing for 2022 is $800, but opening for 2022 unknown).
- Note payments during 2022: $400.
- Identify closing liability at 31 Dec 2022: ambiguous (800 at 1 Jan 2023 implies closing $800 but conflicts with timing).
- Apply formula for expense: payments + closing liability - opening liability; cannot compute without opening liability.
Not enough information.
Final answer: Not enough information.
Topic: Other payables and other receivables
Practice more O Level Accounting (7707) questions on mMCQ.me