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UKAF 1033 Business Accounting 1 Jan 2011
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Tutorial 1
1.
2. Accounting equation
Assets = Capital + Liabilities
A L = C
- depicts the relationship between assets, liabilities and owners equity. - shows the financial position of a business entity at a particular date. - can be presented in the form of balance sheet. - the total of one part is always equal to the total of the other part.
Statement of Financial Position as at XXX
Assets Liabilities
Capital
3.
4.Fatimah
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5. Johari
6.Kok Heng
Tutorial 2
Q.1
Debited Credited Debited Credited
(a) Lorry Cash (b) Siti Bank
(c) Loan from Cash (d) Cash Van
(e) Machinery Amal (f) Cash Ho
(g) Bank Siva (h) Bank Capital
(i) Cash Bala (j) Lam Cash
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Q.2
Date Particulars Dr Cr
Mar 1 Dr Cash 750
Dr Bank 9,000
Cr Capital 9,750
Mar 2 Dr Bank 2,000
Cr Dala (Loan creditor) 2,000
Mar 3 Dr Equipment (Computer) 600
Cr Cash 600
Mar 5 Dr Equipment (display equipment) 420
Cr Chin Enterprise 420
Mar 8 Dr Cash 200
Cr Bank 200
Mar 15 Dr Dala 500
Cr Bank 500
Mar 17 Dr Chin Enterprise 420
Cr Bank 420
Mar 24 Dr Dala 250
Cr Cash 250
Mar 31 Dr Equipment (Printer) 200
Cr Lim 200
Q.3 Fendy
Bank Cash
1 Capital 11000 5 Stationery 62 1 capital 1600 3 purchases 370
24 Wong 250 16 biz rates 970 4 rent 75
28 Biz rates 45 19 rent 75 7 wages 160
28 ben 830 11 rent 75
28 mardi 415 18 insurance 280
28 betty 6100 21 motor exp 24
23 wages 170
Ben
28 bank 830 2 Purchases 830 Sales
6 tam 370
betty 6 husin 290
28 bank 6100 20 motor vehi 6100 6 wong 410
15 lee 205
mardi 15 sharee 280
10 returns out 195 2 purchases 610 15 rashid 426
28 bank 415
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Returns Inwards
lam 13 husin 35
2 purchases 590
Returns outwards
tam 10 mardi 195
6 Sales 370
rent
husin 4 cash 75
6 sales 290 13 returns in 35 11 cash 75
19 cash 75
wong
6 Sales 410 24 bank 250 biz rates
16 Bank 970 28 bank 45
lee
15 sales 205 wages
7 cash 160
sharee 23 cash 170
15 Sales 280
stationery
rashid 5 Bank 62
15 sales 426
insurance
Capital 18 cash 280
1 Bank 11000
1 cash 1600 motor exp
21 cash 24
purchases
2 ben 830 motor vehicle
2 mardi 610 20 betty 6100
2 lam 590
3 cash 370
Tutorial 3
1. Joe Trading
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2. Kim
3. Gary
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4.
5. (a) Purpose of day books
- segregation of duties different bookeepers - provides a means of internal control to prevent fraud - facilitates the location of errors and ensuring accuracy of ledgers
(b) Sales day book: Invoice
Purchases day book: Suppliers Invoice Sales return day book: Credit note
Purchases return day book: Debit note
Contents:- Date on which each transaction took place
- Name and contact information of the addressee
- Details or description relating to the sales/purchases/returns
transaction (e.g: name of the goods, no. of items).
- Folio column entry for cross referencing back to the original source
documents
- Monetary amounts of the goods
Tutorial 4
1.
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2. Kedai Runcit Shaari
3. Purpose of trial balance
(a) to ascertain whether the total of the accounts with debit balances equals the
total of the accounts with credit balances (matching credit entry for every debit
entry).
(b) to prove arithmetic accuracy of the ledger accounts.
(c) to assist in the preparation of financial statements.
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4.
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Tutorial 5
1. Trial Balance as at 31 Dec 2007
RM RM
Capital 39,980
Drawings 14,760
Loan- Public Bank 20,000
Leasehold premises 52,500
Motor vehicles 13,650
Investment 4,980
Trade debtors 2,630
Trade creditors 1,910
Cash 460
Bank overdraft 3,620
Sales 81,640
Purchases 49,870
Returns outwards 960
Returns inwards 840
Carriage 390
Wages and salaries 5,610
Rent and rates 1,420
Light and heat 710
Telephone and postage 540
Printing and stationery 230
Bank interest 140
Interest received 620
148,730 148,730
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2
.
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Tutorial 6
1. Cash Book
Balance b/d 2,740 Bank charges 32
Beh 201 Gina 93
Balance c/d 2816
2,941 2,941
Bank Reconciliation statement as on 31 March 2008
Balance as per cash book 2816
Add: Unpresented cheque 131
2947
Less: Lodgements not yet credited 410
Balance as per bank statement 2537
2.Hogan
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3. Thomas Lee
4. King
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5. Han Chung Trading
(a) Cash Book
RM RM
Balance b/f 1,470 Payments (15,520+47) 15,567
Receipts (15,073-47-18) 15,008 Bank charges 35
Balance c/f 876
16,478 16,478
(b) Bank Reconciliation Statement as on 31 Oct 2007
RM RM
Balance as per cash book 876
Add Unpresented cheques (214+370+30) 614 614
1,490
Less Uncredited lodgements 1,542
Bank error in debiting account 72 1,614
Balance as per bank statement (124)
6. Factors causing the differences:-
(a) Timing differences
Uncredited lodgements and unpresented cheques
(b) Omissions and errors Omissions of transactions such as bank charges, standing order, direct debit,
credit transfer, dishonoured cheque of third parties; and errors in cash book.
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Tutorial 7
1.
2.
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3.
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4.
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Tutorial 8
1.
2.
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3.Didi
4.
(a) Journal
Debit Credit
RM RM
Bank 500
Thong 500
(Being receipt of RM500 towards debt previously written off)
Thong 500
Bad debts recovered account 500
(Being reversal of debt previously written off)
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(b) Provision for doubtful debts
RM RM
Balance c/d 1,045 Balance b/d 900
(22,000-800-300)*5% P+L 145
1,045 1,045
(c) Balance Sheet as at 30 Nov 2007
RM
Current Asset
Trade Debtors (22,000-1,100) 20,900
Less: Provision for doubtful debts 1,045
19,855
5.
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Tutorial 9
1. Hikmat Trading
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2. Bakti Enterprise
3. Ori Sdn Bhd
Rent and Rates
2006 RM 2006 RM
1-Jun Prepaid rent b/d 200 1-Jun Accrual rates b/d 340
1-Jul Bank- Q3 600
30-Sep Bank- Rates 2,040
1-Oct Bank- Q4 600
2007
1-Jan Bank- Q1 750 31-May P+L (Rates) 2,080
1-Apr Bank- Q2 750 31-May P+L (Rent) 2,650
Accrual rates c/d 380 31-May Prepaid rent c/d 250
5,320 5,320
1-Jun Prepaid b/d 250 1-Jun Accrual rates b/d 380
Workings: P+L (Rent) = 7*200 (Jun-Dec'06) +
5*250 (Jan-May'07)
= 2,650
P+L (Rates) = 10*170 (Jun'06-Mar'07) +
2*190 (Apr'07-May'07)
= 2,080
b) Matching principles refers to the assumption that in the measurement of profit,
costs should be set against the revenue which they generate at the point in time
when this arises.
In this case, the rent and rates expenses are matched according to the
accounting period. Expenses give rise to certain effects which take the form of
revenue. Matching is thus the determination of profit by attributing specific
causes to particular effects at the point in time at which the effects occur.
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Tutorial 10
1. Soon
Statement of Comprehensive Income for the year ended 31 Dec 2008
RM RM
Sales (1000+250+8+3-200) 1,061
Less: Cost of sales
Opening stock 200
Purchases (700+160-180) 680
880
less: Closing stock 230 650
Gross profit 411
Less: Expenditure
Rent (8+30-10) 28
Insurance (12+20+6) 38
Electricity (25+7-9) 23
Telephone (10-2-1) 7
Wages 100
Discounts allowed 8
Bad debts written off 3
Depreciation 50 257
154
Statement of Financial Position as at 31 Dec 2008
RM RM RM
Fixed assets (350-50) 300
Current Assets
Trade debtors 250
Stock 230
Bank (20+1000-700-185-50) 85
Prepayments (10+2) 12
577
Less: Current Liabilities
Accruals (7+6) 13
Trade creditors 160 173
Net current assets 404
704
Capital
Balance as at 1 Jan 2008 600
Add: Net profit 154
754
Less: Drawings 50
704
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2.
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Tutorial 11
1.
2.
3.
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4. Types of error that do not affect the trial balance agreement
(a) Error of omission
A transaction is completely omitted from the books.
(b) Error of principle
An entry is made in the wrong class of account.
(c) Error of commission
An entry is posted to the wrong persons account. (d) Error of original entry
The double entry principle is correct but error occurs in the original documents
where the figure is incorrect.
(e) Complete reversal of entry
An account that should be credited is debited and vice versa.
(f) Compensating error Errors occur and cancel each other out.
Tutorial 12
1. Regent Sdn Bhd
a) RM RM
i) Bank Charges 56
Cash 56
ii) Creditors control 400
Purchases 400
iii) Debtors control 100
Sales 100
iv) Creditors control/ Amin Trading 90
Purchases 90
v) Bad debts 88
Debtors control/ Shanie 88
vi) Motor expenses 550
Motor Vehicle 550
vii) Accumulated Depreciation 55
Depreciation 55
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b) Statement of Corrected Net Profit for the year ended 31 May 2008
RM
Net profit as per draft final account 305,660
Add: Purchases overcast 400
Sales undercast 100
Error in purchases journal 90
Wrongly accounted depreciation 55 645
Less: Bank charges 56
Bad debts 88
Repair and maintenance 550 694
305,611
2.
3. Gail Dawson
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Tutorial 13
1.
2.
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3.
4.
Debtors' Ledger Control
RM RM
Balance b/d 7,182 Cash 59,129
Sales 69,104 Discounts allowed 1,846
Cash 66 Returns inwards 983
Interest on overdue account 10 Bills receivable 3,243
Balance c/d 42 Bad debts 593
Creditors ledger control 303
Balance c/d 10,307
76,404 76,404
Balance b/d 10,307
5. Purpose of Control Accounts
- to provide a check on the accuracy of the ledger
- to facilitate the location of erros higlighted in the trial balance by pinpointing
the personal ledger
- deter fraud and ensure proper segregation of duties
- facilitate the extraction of balances on creditors and debtors, whereby
information is obtained immediately from control accounts
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Tutorial 14
1. Balan
2. Othman
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3. Amal
Statement of Comprehensive Income for the year ended 31 May 2008
RM RM
Sales 405,000
Less: Cost of sales
Opening stock 27,400
Purchases (259,600-1,040) 258,560
285,960
less: Closing stock 25,900 260,060
Gross profit 144,940
Add: Discounts received 4,420
Reduction in provision of doubtful debts ([0.5%*46,200]-280) 49
149,409
Less: Expenditure
Discounts allowed 3,370
Wages and salaries (52,360+140) 52,500
Bad debts 1,720
Loan interest 1,560
Carriage outwards 5,310
Other operating expenses (38,800-500+200) 38,500
Depreciation on property (90,000*1%) 900
Depreciation on equipment (57,500*15%) 8,625
112,485
Net profit 36,924
Statement of Financial Position as at 31 May 2008
RM RM RM
Cost Acc. Depn NBV
Fixed Assets
Property 90,000 13,400 76,600
Equipment 57,500 41,125 16,375
92,975
Current Assets
Stock 25,900
Trade debtors 46,200
Less: Provision of bad debts 231 45,969
Cash on hand 151
Prepayment 500
72,520
Less: Current Liabilities
Bank overdraft 14,500
Accruals (140+200) 340
Trade creditors 33,600 48,440
Net current assets 24,080
117,055
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Less: Long term liability
13% loan 12,000
Net assets 105,055
Capital
Balance at 1 June 2007 98,101
Add: Net profit 36,924
135,025
Less: Drawings (28,930+1,040) 29,970
105,055
4. Tim
Statement of Comprehensive Income for the year ended 30 Sep 2007
RM RM
Sales 203,845
Less: Cost of sales
Opening stock 14,972
Purchases (167,760-112) 167,648
182,620
less: Closing stock 12,972 169,648
Gross profit 34,197
Add: Discounts received 955
35,152
Less: Expenditure
Rent (1,350+450) 1,800
Light and heat (475+136) 611
Insurance 304
Salaries 6,352
Stationery and printing 737
Telephone and postage 517
General Expenses (2,044+252) 2,296
Travellers commission and expenses (9,925+806) 10,731 Discounts allowed 517
Bad debts written off 331
Provision for doubtful debts 430
Depreciation on office furniture and equipment (1,440*10%) 144
24,770
Net profit 10,382
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Statement of Financial Position as at 30 Sep 2007
RM RM RM
Fixed Assets
Office furniture and equipment (1,440-144) 1,296
Current Assets
Stock 12,972
Debtors 19,100
Less: Provision of bad debts 573 18,527
Bank 6,603
Petty cash in hand 29
38,131
Less: Current Liabilities
Accruals (450+136+806+252) 1,644
Trade creditors 8,162 9,806
Net current assets 28,325
29,621
Capital
Balance at 1 June 2007 24,239
Add: Net profit 10,382
34,621
Less: Drawings (4,888+112) 5,000
29,621
5.
Statement of Comprehensive Income for the year ended 31 Jan 2006
RM RM RM
Sales (50,240-300) 49,940
Less: Return inwards 136
49,804
Less: Cost of sales
Opening stock 13,630
Purchases 42,400
less: Return outwards 348 42,052
55,682
less: Closing stock (15,450+240) 15,690 39,992
Gross profit 9,812
Add: Gain on sales of motor vehicle 40
9,852
Less: Expenditure
Salaries and wages 4,100
Rent, rates and insurance (860+36-60-10) 826
Sundry expenses (750+90) 840
Provision for doubtful debts (340-280) 60
Bad debts 134
Depreciation on fixtures and fittings (1400*10%+240*4/12*10%) 148
Depreciation on motor vehicles ([920-80]*25%) 210
6,318
Net profit 3,534
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Statement of Financial Position as at 31 Jan 2006
RM RM RM
Fixed Assets
Fixture and fittings 1,640 148 1,492
Motor Vehicle 840 210 630
2,122
Current Assets
Stock 15,690
Sundry debtors (4,610-300) 4,310
Less: Provision of bad debts 340 3,970
Prepayments (60+10) 70
Cash at bank and in hand 3,820
23,550
Less: Current Liabilities
Accruals (36+90) 126
Sundry creditors 3,852 3,978
Net current assets 19,572
21,694
Capital
Balance at 1 June 2007 20,760
Add: Net profit 3,534
24,294
Less: Drawings 2,600
21,694
Workings: Profit of 20% on sales price
x =
100
240 80
x = RM300