Kofi operates a retail store with single-entry records. For the year ended 31 December 202… — JAMB UTME

Kofi operates a retail store with single-entry records. For the year ended 31 December 2025, his cash records revealed the following information:

- Cash in hand (1 January 2025): $\text{₦}15,000$
- Cash banked during the year: $\text{₦}120,000$
- Cash paid for business expenses: $\text{₦}35,000$
- Cash drawings by Kofi: $\text{₦}18,000$
- Cash paid to trade creditors: $\text{₦}42,000$
- Cash in hand (31 December 2025): $\text{₦}8,000$

Assuming all cash received originated exclusively from cash sales, what was the total cash sales for the year?

$\text{₦}208,000$ Answer
B
$\text{₦}238,000$
C
$\text{₦}190,000$
D
$\text{₦}172,000$

Answer

The total cash sales for the year was

\text{₦}208,000

The total cash sales is found by constructing the cash account summary. Total cash outlays (bankings of

\text{₦}120,000

, expenses of

\text{₦}35,000

, drawings of

\text{₦}18,000

, and payments to creditors of

\text{₦}42,000

) plus closing balance of

\text{₦}8,000

equal

\text{₦}223,000

. Subtracting the opening cash balance of

\text{₦}15,000

gives

\text{₦}208,000

Step-by-Step Solution

Calculate total cash accounted for on the credit (payments) side of the cash summary

Total Payments + Closing Balance =

\text{₦}120,000 + \text{₦}35,000 + \text{₦}18,000 + \text{₦}42,000 + \text{₦}8,000 = \text{₦}223,000

All cash payments and remaining cash at the end of the period must be balanced against cash available.

Deduct opening cash balance to determine missing cash receipts (cash sales)

Cash Sales =

\text{₦}223,000 - \text{₦}15,000 = \text{₦}208,000

Total cash accounted for minus initial cash in hand equals total cash collected during the period.

Key Concept

Cash Account Balancing for Missing Cash Sales

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