Question 1 Describe a transaction that would: a. Increase both an asset and a liability. b. Increase one asset and decrease another asset. c. Decrease both a liability and an asset. d. Increase both an asset and retained earnings. e. Decrease both an asset and retained earnings. Question 2 Identify whether the following group of people belongs to internal or external users of annual reports for a company. Eexplain their need for financial information. a. Johari, investment banker of CIMB Investment Bank. b. Daisy Ong, purchasing manager of the company. c. Happy Berhad, supplier of the company. d. Great Sdn Bhd, regular customer of the company. e. Amy, officer from Inland Revenue Board. Question 3 Eng Hardwares has the following balance as at 30 November 2020: Wages(Debit) 110,000 Insurance (Debit) 2,000 Rental (Credit) 50,000 Additional information: i. Eng Hardwares pays wages to its workers at the end of every month. However, some internal problems arise and it did not pay wages amounting to RM10,000 to its workers on time on the last day of December 2020. ii. It paid RM10,000 for insurance covered from period December 2020 until March 2021 on 3rd December 2020. iii. It rents out part of its warehouse to another business for RM2,000 per month and receives the rent on the last day of each quarter on 31st March, 30th June, 30th September, and 31st December. However, the tenant has some financial difficulties and failed to pay the three-month rent from October 2020 to December 2020 on 31 December, 2020. iv. On 1 December 2020 it received RM21,600 for a one year rental from a new tenant. Required:- Prepare the journal entry for the reversal of the balance on the last day of adjustment and post it to the general ledger accounts from the information I to iv provided above. Question 4 The following information is taken from the records of Wildlife Florist. The company uses the perpetual inventory system. Date Description Units Unit Cost (RM) Dec-01 Opening Inventory 200 20 Dec-05 Sale 108 Dec-06 Purchase 200 18 Dec-12 Purchase 125 17 Dec-13 Sale 300 Dec-19 Purchase 350 21 Dec-29 Purchase 150 18 Dec-30 Sale 400 Required:- a. Calculate cost of goods sold and the cost of ending inventory under each of the following inventory cost flow assumptions: i. FIFO. ii. Weighted average. Assume each unit was sold for RM25. Complete the following partial income statements: FIFO Weighted Average Sales Less: Cost of Sales Gross Profit Question 5 The following balances were extracted from the books of Billion Precision for the year ended 31 December 2020. Dr (RM) Cr (RM) Land 500 000 Building 200 000 Motor Vehicles 120 000 Plant & machinery 70 000 Profit b/f as at 01.01.2020 237 650 Capital 438 000 Acc depreciation as at 1.1.2020 Building 60 000 Motor Vehicles 69 250 Plant & machinery 40 000 Returns 3 600 4 100 Revenue 800 000 Purchases 400 000 Discounts 5 000 Carriage inwards 7 700 Opening inventory 52 000 Provision for bad debts 2 000 Trade receivable / Trade payable 66 000 43 200 Advertising 18 000 Staff training cost 4 000 Bad debts 12 500 Motor expenses 27 000 Rental 90 000 Bank 7 600 Wages & Salaries 126 000 Grand Total 1 701 800 1 701 800 Additional information: i. The provision for bad debts should be 4% of trade receivables. ii. Depreciation is to be charged as follows: -Buildings 2% on cost. -Plant and machinery 20% on cost. -Vehicles 25% on cost. iii. The closing inventories is valued at RM57,000. Required: a. Prepare the Statement of Comprehensive Income for the year ended 3 December 2020. b. Prepare the Statement of Financial Position for the year ended 31 December 2020. END OF QUESTION
Question 1
Describe a transaction that would:
a. Increase both an asset and a liability.
b. Increase one asset and decrease another asset.
c. Decrease both a liability and an asset.
d. Increase both an asset and
e. Decrease both an asset and retained earnings.
Question 2
Identify whether the following group of people belongs to internal or external users of annual reports for a company. Eexplain their need for financial information.
a. Johari, investment banker of CIMB Investment Bank.
b. Daisy Ong, purchasing manager of the company.
c. Happy Berhad, supplier of the company.
d. Great Sdn Bhd, regular customer of the company.
e. Amy, officer from Inland Revenue Board.
Question 3
Eng Hardwares has the following balance as at 30 November 2020:
Wages(Debit) 110,000
Insurance (Debit) 2,000
Rental (Credit) 50,000
Additional information:
i. Eng Hardwares pays wages to its workers at the end of every month. However, some internal problems arise and it did not pay wages amounting to RM10,000 to its workers on time on the last day of December 2020.
ii. It paid RM10,000 for insurance covered from period December 2020 until March 2021 on 3rd December 2020.
iii. It rents out part of its warehouse to another business for RM2,000 per month and receives the rent on the last day of each quarter on 31st March, 30th June, 30th September, and 31st December. However, the tenant has some financial difficulties and failed to pay the three-month rent from October 2020 to December 2020 on 31 December, 2020.
iv. On 1 December 2020 it received RM21,600 for a one year rental from a new tenant.
Required:-
Prepare the
Question 4
The following information is taken from the records of Wildlife Florist. The company uses the perpetual inventory system.
| Date | Description | Units | Unit Cost (RM) |
| Dec-01 | Opening Inventory | 200 | 20 |
| Dec-05 | Sale | 108 | |
| Dec-06 | Purchase | 200 | 18 |
| Dec-12 | Purchase | 125 | 17 |
| Dec-13 | Sale | 300 | |
| Dec-19 | Purchase | 350 | 21 |
| Dec-29 | Purchase | 150 | 18 |
| Dec-30 | Sale | 400 |
Required:-
a. Calculate cost of goods sold and the cost of ending inventory under each of the following inventory cost flow assumptions:
i. FIFO.
ii. Weighted average.
Assume each unit was sold for RM25. Complete the following partial income statements:
| FIFO | Weighted Average | |
| Sales | ||
| Less: Cost of Sales | ||
| Gross Profit |
Question 5
The following balances were extracted from the books of Billion Precision for the year ended 31 December 2020.
| Dr (RM) | Cr (RM) | |
| Land | 500 000 | |
| Building | 200 000 | |
| Motor Vehicles | 120 000 | |
| Plant & machinery | 70 000 | |
| Profit b/f as at 01.01.2020 | 237 650 | |
| Capital | 438 000 | |
| Acc |
||
| Building | 60 000 | |
| Motor Vehicles | 69 250 | |
| Plant & machinery | 40 000 | |
| Returns | 3 600 | 4 100 |
| Revenue | 800 000 | |
| Purchases | 400 000 | |
| Discounts | 5 000 | |
| Carriage inwards | 7 700 | |
| Opening inventory | 52 000 | |
| Provision for |
2 000 | |
| Trade receivable / Trade payable | 66 000 | 43 200 |
| Advertising | 18 000 | |
| Staff training cost | 4 000 | |
| Bad debts | 12 500 | |
| Motor expenses | 27 000 | |
| Rental | 90 000 | |
| Bank | 7 600 | |
| Wages & Salaries | 126 000 | |
| Grand Total | 1 701 800 | 1 701 800 |
Additional information:
i. The provision for bad debts should be 4% of trade receivables.
ii. Depreciation is to be charged as follows:
-Buildings 2% on cost.
-Plant and machinery 20% on cost.
-Vehicles 25% on cost.
iii. The closing inventories is valued at RM57,000.
Required:
a. Prepare the Statement of Comprehensive Income for the year ended 3 December 2020.
b. Prepare the
END OF QUESTION
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
