ACC2250 Accounting II Mock Exam 1 PDF

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Summary

A Mock Exam relating to the ACC2250 Accounting II ECU unit. Composed in semster 1, 2017...

Description

INTERNAL

Unit Code and Title

ACC2250 Accounting II

Student Number

MOCK EXAM NO. 1

SURNAME/FAMILY NAME

OTHER OR GIVEN NAME/S

Please print clearly

Duration

Reading time Working time Total time

Attempt

All nine questions.

Marks

As indicated on paper.

Type of Exam

Closed Book exam – textbooks, notes, unit guide are materials not permitted.

Special Instructions

   

5 minutes 3 hours 3 hours 5 minutes

This examination paper consists of nine questions worth a total of 122 marks. There are a total of 18 pages. Non-programmable calculators are allowed. All answers must be written in the spaces provided in this paper, the examination paper.

Students are not permitted to write on the examination or any other paper during reading time. Do not commence the examination until you are told to do so.

Page 1 of 18

Examination Questions This exam paper consists of nine questions worth 122 marks in total. All exam questions must be answered in this paper, in the spaces provided. Please do not write your answers on any other paper. All questions should be attempted.

Question 1:

Marks: 16 In December 2016, Mike Mills opened a miniature golf course to cater for the summer holiday tourists and completed the transactions below during its second month of operations. For the sake of simplicity, GST is ignored. Jan .

4 8 1 3 1 4 1 5 2 1 3 1 3 1

Paid $1800 of the amount owed for supplies. Paid $820 for advertisements in local newspaper. Mike withdrew $1000 from the business for personal use. Recorded cash revenue for the first half of January of $7800. Paid wages of $2400 in cash. Purchased supplies on credit for $3100. Recorded cash revenue for the second half of January of $9400. Paid rent for January, $2400.

Please use the following account titles and numbers: Cash at Bank, 1–100 Supplies, 1–110 Equipment, 1–120 Accounts Payable, 2–100 Loan Payable, 2–110 M. Mills, Capital, 3–100 M. Mills, Drawings, 3–110 Revenue, 4–100 Rent Expense, 5–100 Advertising Expense, 5–110 Wages Expense, 5–120

Page 2 of 18

Required

You are required to record the January transactions using appropriate account details from those provided in the abridged chart of accounts above. Please ignore GST.

Payment for supplies

Payment for advertising

Withdrawal by owner

Cash revenue for first half of month

Payment for wages

Supplies purchased on credit

Cash revenue for second half of month

Rent paid for January

Page 3 of 18

Question 2: Marks: 24 On June 30, 2016 the following information appeared in the accounting records of Ndung and Mkoka:    

Balance of Accounts Receivable Control account, $3,725 Total of schedule of accounts receivable, $1,970 Balance of Accounts Payable Control account, $5,010 Total of schedule of accounts payable, $2,745

Because the schedules and control account balances do not agree, an investigation was carried out. The following errors and omissions were discovered. 1. The schedule of accounts payable was understated by $545 because of error in addition. 2. The balance of a debtor was accidentally left out of the schedule of accounts receivable, $25. 3. The total of the accounts payable column in the cash payments journal is overstated by $200 because of an addition error. 4. $108 owed by a debtor was written off as uncollectable. The write-off was recorded in the general journal, but the entry was never posted. 5. The total payment of $1,955 made to creditors was debited to the Accounts Receivable Control account in error. 6. The sales journal was incorrectly added and posted as $2139. The total should have been $2,319. 7. A credit note given for $40 was recorded as $60 in the general journal and posted as such. 8. An invoice for $125 was recorded correctly in the purchases journal but posted to the creditor’s account as $152. 9. A cheque received from a debtor for $65 was dishonoured. To record the dishonoured cheque, an entry was made in the cash payments journal but included in the accounts payable column in error. The posting to the debtor’s account in the subsidiary ledger was done correctly. Required In the table below, please indicate how the errors and omissions should be corrected by inserting the amounts in the correct columns. Obtain totals for the columns and reconcile the control totals to the respective schedule totals.

Page 4 of 18

No.

Accounts

Schedule of

Accounts

Schedule of

Receivable Control Dr Cr

Accounts Receivable Dr Cr

1 2 3 4 5 6 7 8 9 Old New

Page 5 of 18

Payable Control Dr Cr

Accounts Payable Dr Cr

Question 3: Marks: 13 Michael Rau founded Michael’s Fishing Supplies on July 1 2016. The adjusted trial balance at 30 June 2017 (the end of the financial year) is shown below.

MICHAEL’S FISHING SUPPLIES Adjusted Trial Balance as at 30 June 2017 Account Debit Cash at bank $ 12 400 Accounts receivable 25 200 2 160 GST receivable 6 000 Fishing supplies 3 000 Prepaid insurance Boat 36 000

Credit

$ 18 000 6 000 2 040 3 120 7 800 6 720 3 600 18 000

Accumulated depreciation – boat Accounts payable Salaries payable Interest payable Mortgage payable Unearned revenue GST payable Michael Rau, Capital Michael Rau, Drawings Sales Salaries expense Insurance expense Interest expense Depreciation expense Fishing supplies expense Rent expense

14 400 60 640 14 040 1 080 600 4 200 2 040 4 800 $125 920

Page 6 of 18

$125 920

Required Please prepare the closing entries as at June 30, 2017 using the account names as given in the Trial Balance.

2017

Close income accounts to Profit or Loss Summary

Close expense accounts to Profit or Loss Summary

Close Profit or Loss Summary to Capital

Close Drawings to Capital

Page 7 of 18

Question 4: Marks: 4 The following information has been extracted from the cash records of Wheeler Ltd and shows four independent situations. Assume there were no direct bank debits or credits on the bank statement and that all outstanding deposits and un-presented cheques in one month appeared on the bank statement in the following month. 1. The total of outstanding deposits on the April 30 bank reconciliation statement was $1,875. During May, the company made deposits of $40,200 to its bank account but the bank statement showed that only $39,840 was deposited during the month. 2. The total of un-presented cheques on the April 30 bank reconciliation statement was $1,440. During May, the total of cheques issued was $29,175 but the bank statement showed that only $27,720 in cheques were presented during the month. 3. During July, deposits recorded on the bank statement totalled $46,200, but deposits according to the company’s records were $43,950 and outstanding deposits at July 31 were $4,125. 4. In July, cash payments according to Wheeler Ltd’s records were $40,800, cheques presented and shown on the bank statement were $43,000 and unpresented cheques at July 31 were $3,960. Required: Please answer the following questions based on the independent scenarios given above A. In situation 1, what were the outstanding deposits at May 31?

B. In situation 2, what were the un-presented cheques at May 31?

C. In situation 3, what were the outstanding deposits at June 30?

D. In situation 4, what were the un-presented cheques at June 30?

Page 8 of 18

Question 5: Marks: 12 Cathy Smythe, who trades as Cathy’s Corner, uses the following journals in her business: general, cash receipts, cash payments, sales and purchases. The control account for the accounts receivable in the general ledger at June 1, 2015 (with posting references omitted) is summarised below:

Accounts Receivable Control 2015 116,380 June 9 7,458 June 18 132,000 June 26 June 30

2015 June 1 June 21 June 30

7,436 [1] 748 7,458 96,800

[1] Promissory note due October 18 Sets out below are the only two subsidiary ledger accounts for receivables affected by general journal entries during June: L. Jones Date 2015 June 1 8 18

Post Ref.

S5 J7

Debit

G. Lyons Credit

Balance

748

(748) 990 242

1 738

Date

Page 9 of 18

2015 June 1 9 22 26

Post Ref.

J7 CP8 J7

Debit

Credit

7 436 7 458 7 458

Balance 7 436 — 7 458 —

Required In Part A please finalise the Accounts Receivable Control Account T-Account ledger and in Part B determine what the total of the schedule of accounts receivable should be on June 30, 2016. Part A: Marks: 11

2015

Accounts Receivable Control 2015

Part B: Marks: 1

Page 10 of 18

Question 6: Marks: 8 Schofield’s Stores carried out the following transactions relating to a single product in October: Oct .

5 1 1 1 3 1 9 2 6

Purchased 100 units for $60 each + GST on credit. Returned 6 units, which were unsuitable. Sold 112 units for $90 each + GST on account. A customer returned 3 units sold on 13 October. Sold 35 units for $90 + GST each on account.

Cost of Sales Other Expenses Profit or Loss Summary

Abridged Chart of Accounts Sales Sales Returns and Allowances Schofield - Capital

Required Assuming that the business closes its records at the end of the month, please prepare the journal entries to close the Profit or Loss Summary accounts based on the transactions given above. You must use appropriate account titles from those provided in the abridged chart of accounts above. Other expenses for October were $2,900.

Close debit accounts.

Close credit accounts.

Transfer profit to capital account.

Page 11 of 18...