b) prepare a trial balance as at 31st January 2026 using the balances obtained from the ledger accounts (20 marks)

Here are the ledger accounts and the trial balance based on the journal entries.

Part A: Ledger Accounts

Cash Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 1 \quad Capital} & 50,000 & \text{Jan 2 \quad Bank} & 30,000 \\ \text{Jan 7 \quad Sales} & 15,000 & \text{Jan 3 \quad Purchases} & 10,000 \\ & & \text{Jan 25 \quad Wages Expense} & 3,000 \\ & & \text{Jan 28 \quad Stationery Expense} & 500 \\ & & \text{Jan 30 \quad Drawings} & 1,500 \\ & & \text{Jan 31 \quad Balance c/d} & 20,000 \\ \hline \textbf{Total} & \textbf{65,000} & \textbf{Total} & \textbf{65,000} \\ \hline \text{Feb 1 \quad Balance b/d} & 20,000 & & \\ \hline \end{array}$$

Capital Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 31 \quad Balance c/d} & 50,000 & \text{Jan 1 \quad Cash} & 50,000 \\ \hline \textbf{Total} & \textbf{50,000} & \textbf{Total} & \textbf{50,000} \\ \hline & & \text{Feb 1 \quad Balance b/d} & 50,000 \\ \hline \end{array}$$

Bank Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 2 \quad Cash} & 30,000 & \text{Jan 12 \quad Rent Expense} & 2,000 \\ \text{Jan 22 \quad Accounts Rec. (Chanda)} & 8,800 & \text{Jan 20 \quad Accounts Payable (Banda)} & 9,800 \\ & & \text{Jan 31 \quad Balance c/d} & 27,000 \\ \hline \textbf{Total} & \textbf{38,800} & \textbf{Total} & \textbf{38,800} \\ \hline \text{Feb 1 \quad Balance b/d} & 27,000 & & \\ \hline \end{array}$$

Purchases Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 3 \quad Cash} & 10,000 & \text{Jan 31 \quad Balance c/d} & 20,000 \\ \text{Jan 5 \quad Accounts Payable (Banda)} & 10,000 & & \\ \hline \textbf{Total} & \textbf{20,000} & \textbf{Total} & \textbf{20,000} \\ \hline \text{Feb 1 \quad Balance b/d} & 20,000 & & \\ \hline \end{array}$$

Accounts Payable (Banda) Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 15 \quad Purchases Returns} & 1,000 & \text{Jan 5 \quad Purchases} & 10,000 \\ \text{Jan 20 \quad Bank} & 9,800 & & \\ \text{Jan 20 \quad Discount Received} & 200 & & \\ \text{Jan 31 \quad Balance c/d} & 1,000 & & \\ \hline \textbf{Total} & \textbf{12,000} & \textbf{Total} & \textbf{10,000} \\ \hline \text{Feb 1 \quad Balance b/d} & 1,000 & & \\ \hline \end{array}$$

Note: The transaction on Jan 20 "Paid Banda by cheque K9,800 in full settlement of his account of K10,000" implies that a K10,000 liability was cleared, resulting in a K200 discount. This means the K1,000 return on Jan 15 was not part of this K10,000 settlement, leading to a K1,000 debit balance in Banda's account, indicating Banda owes the business K1,000.

Sales Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 31 \quad Balance c/d} & 25,000 & \text{Jan 7 \quad Cash} & 15,000 \\ & & \text{Jan 10 \quad Accounts Rec. (Chanda)} & 10,000 \\ \hline \textbf{Total} & \textbf{25,000} & \textbf{Total} & \textbf{25,000} \\ \hline & & \text{Feb 1 \quad Balance b/d} & 25,000 \\ \hline \end{array}$$

Accounts Receivable (Chanda) Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 10 \quad Sales} & 10,000 & \text{Jan 18 \quad Sales Returns} & 1,000 \\ & & \text{Jan 22 \quad Bank} & 8,800 \\ & & \text{Jan 22 \quad Discount Allowed} & 200 \\ \hline \textbf{Total} & \textbf{10,000} & \textbf{Total} & \textbf{10,000} \\ \hline \text{Feb 1 \quad Balance b/d} & 0 & & \\ \hline \end{array}$$

Rent Expense Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 12 \quad Bank} & 2,000 & \text{Jan 31 \quad Balance c/d} & 2,000 \\ \hline \textbf{Total} & \textbf{2,000} & \textbf{Total} & \textbf{2,000} \\ \hline \text{Feb 1 \quad Balance b/d} & 2,000 & & \\ \hline \end{array}$$

Purchases Returns Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 31 \quad Balance c/d} & 1,000 & \text{Jan 15 \quad Accounts Payable (Banda)} & 1,000 \\ \hline \textbf{Total} & \textbf{1,000} & \textbf{Total} & \textbf{1,000} \\ \hline & & \text{Feb 1 \quad Balance b/d} & 1,000 \\ \hline \end{array}$$

Sales Returns Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 18 \quad Accounts Rec. (Chanda)} & 1,000 & \text{Jan 31 \quad Balance c/d} & 1,000 \\ \hline \textbf{Total} & \textbf{1,000} & \textbf{Total} & \textbf{1,000} \\ \hline \text{Feb 1 \quad Balance b/d} & 1,000 & & \\ \hline \end{array}$$

Discount Received Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 31 \quad Balance c/d} & 200 & \text{Jan 20 \quad Accounts Payable (Banda)} & 200 \\ \hline \textbf{Total} & \textbf{200} & \textbf{Total} & \textbf{200} \\ \hline & & \text{Feb 1 \quad Balance b/d} & 200 \\ \hline \end{array}$$

Discount Allowed Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 22 \quad Accounts Rec. (Chanda)} & 200 & \text{Jan 31 \quad Balance c/d} & 200 \\ \hline \textbf{Total} & \textbf{200} & \textbf{Total} & \textbf{200} \\ \hline \text{Feb 1 \quad Balance b/d} & 200 & & \\ \hline \end{array}$$

Wages Expense Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 25 \quad Cash} & 3,000 & \text{Jan 31 \quad Balance c/d} & 3,000 \\ \hline \textbf{Total} & \textbf{3,000} & \textbf{Total} & \textbf{3,000} \\ \hline \text{Feb 1 \quad Balance b/d} & 3,000 & & \\ \hline \end{array}$$

Stationery Expense Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 28 \quad Cash} & 500 & \text{Jan 31 \quad Balance c/d} & 500 \\ \hline \textbf{Total} & \textbf{500} & \textbf{Total} & \textbf{500} \\ \hline \text{Feb 1 \quad Balance b/d} & 500 & & \\ \hline \end{array}$$

Drawings Account

$$\begin{array}{l r | l r} \hline \textbf{Date} & \textbf{K} & \textbf{Date} & \textbf{K} \\ \hline \text{Jan 30 \quad Cash} & 1,500 & \text{Jan 31 \quad Balance c/d} & 1,500 \\ \hline \textbf{Total} & \textbf{1,500} & \textbf{Total} & \textbf{1,500} \\ \hline \text{Feb 1 \quad Balance b/d} & 1,500 & & \\ \hline \end{array}$$

Part B: Trial Balance as at 31st January 2026

$$\begin{array}{l r r} \hline \textbf{Account Name} & \textbf{Debit (K)} & \textbf{Credit (K)} \\ \hline \text{Cash} & 20,000 & \\ \text{Bank} & 27,000 & \\ \text{Purchases} & 20,000 & \\ \text{Accounts Payable (Banda)} & 1,000 & \\ \text{Rent Expense} & 2,000 & \\ \text{Sales Returns} & 1,000 & \\ \text{Discount Allowed} & 200 & \\ \text{Wages Expense} & 3,000 & \\ \text{Stationery Expense} & 500 & \\ \text{Drawings} & 1,500 & \\ \text{Capital} & & 50,000 \\ \text{Sales} & & 25,000 \\ \text{Purchases Returns} & & 1,000 \\ \text{Discount Received} & & 200 \\ \hline \textbf{Total} & \textbf{76,200} & \textbf{76,200} \\ \hline \end{array}$$