MID TERM BKAF1023 INTRODUCTION TO FINANCIAL ACCOUNTING QUESTIONS PDF

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BKAF1023 CONFIDENTIALMID-SEMESTER COURSEWORKFIRST SEMESTER 2020/2021 SESSIONCOURSE CODE/NAME : BKAF1023 INTRODUCTION TO FINANCIAL ACCOUNTINGDATE : 20 November 2020 TIME : 10 AM – 12 PM (2 HOURS) VENUE : TAKE HOMEINSTRUCTIONS: This paper contains THREE (3) questions on THREE (3) printed pages excludi...

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BKAF1023

CONFIDENTIAL

MID-SEMESTER COURSEWORK FIRST SEMESTER 2020/2021 SESSION COURSE CODE/NAME : BKAF1023 INTRODUCTION TO FINANCIAL ACCOUNTING DATE : 20 November 2020 TIME : 10.00 AM – 12.30 PM (2.30 HOURS) VENUE : TAKE HOME

INSTRUCTIONS: 1. 2. 3. 4. 5.

This paper contains THREE (3) questions on THREE (3) printed pages excluding the cover page. Use Excel to answer the questions, start your answer on new sheet, and rename the sheet to indicate the question you are answering. Write your NAME, MATRIC NUMBER, and BKAF GROUP in each answer sheet. EMAIL your answer in Excel file to [email protected]. Write MidSem A201 as the email subject. Answer should be sent on or before 12.30pm, 20 November 2020.

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CONFIDENTIAL

BKAF1023 INTRODUCTION TO FINANCIAL ACCOUNTING

QUESTION 1 (10 MARKS)

A. Mr Amir is the accountant for Titian Enterprise. He was asked to prepare the final accounts for the company for the year ended 31 December 2019. Mr Amir was given the following information for him to prepare the final accounts. i.

Mr Leman, the owner of Titian Enterprise, had taken RM3,000 out of the company’s bank account to purchase a motorbike for his son.

ii.

During the Covid19 pandemic, Mr Leman asked Mr Amir to assume that the company will not operate starting January the next year, however, Mr Amir did not agree to this and he is confident that the business will continue to operate in its present form for many years.

iii.

The building and vehicle had been depreciated using the straight-line method. This year, Mr Leman thinks that they should now be depreciated using the reducing balance method.

REQUIRED In each case, identify and then explain the main accounting concepts being highlighted or violated and indicate how each should be treated in the final accounts. (6 Mark)

B. Accountants recognize each form of business organisations as an economic unit separate from its owners. Briefly discuss characteristics of each business organisation below.

i. Partnership (2 Marks) ii. Cooperation (2 Mark)

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BKAF1023 INTRODUCTION TO FINANCIAL ACCOUNTING

QUESTION 2 (12 MARKS) Super Max Cleaning Services (SMCS) is located in Alor Setar, Kedah providing dry cleaning services. Business transactions during November are summarized as follows:

November 1

Description SMCS invested cash in the business with a deposit of RM200,000 in the business bank account.

November 5 November 9 November 11

Purchased land paying cash of RM35,000 Paid rent for the month of RM4,000 Charged customers for dry cleaning revenue on account, RM72,000

November 16 November 21

Purchased supplies on account, RM8,000 Provide dry cleaning service for customers and receive cash on the same

November 24 November 27

day, RM38,000 Received cash from customers on account, RM70,000 Paid the following expenses: wages expenses RM24,000, truck expenses

November 29

RM2,100, utilities RM1,800 and miscellaneous expenses RM1,300 Withdrew RM5,000 for personal use.

REQUIRED: Show the effect of EACH TRANSACTION on the accounting equation using the following format (show accounts name that may affect owners’ equity):

(12 Marks) QUESTION 3 (28 MARKS) Dato Vivida established Cikbi Realty, firm that offers property business and investment consulting services. The accounts executive completed the following transactions during the month of March 2020: 2

BKAF1023 INTRODUCTION TO FINANCIAL ACCOUNTING

Date March 1

Description Dato Vivida transferred cash from a personal bank account to an account to be

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used for the business, RM30,000. Paid rent on office and equipment for the month, RM3,250. Purchased furniture on account, RM2,150. Paid creditor on account, RM875. Borrowed from ABC Bank, RM 25,000 Earned sales commissions, receiving cash RM14, 440. Paid automobile expenses for month, RM1,580, and miscellaneous expenses,

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RM650. Paid office salaries, RM3,000 Withdrew cash for personal use, RM2,500.

REQUIRED: (a)

Prepare the relevant journal entries to record the above transactions. Omit the explanations. (10 Marks)

(b)

Post all journal entries in (a) to the ledger (balance column ledger accounts are required). (10.5 Marks)

(c)

Prepare unadjusted trial balance as at March 31 2020. (7.5 Marks)

END OF QUESTIONS

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