1 HKBN TF6:30 34%0 Revised 201920 summer term... and the name of the accounting principle applied. Tzu marks) (b) Prepare the Income Statement for the year ended 31 December 2019, under the captions of Service Revenues, Expenses, Profit before taxes and Profit after taxes. (12 marks) 4/4 repare the Statement of Financial Position as at 31 December 2019, under the captions of Total Assets, Total Liabilities, Total Equity, Total Liabilities and Equity. (22 marks) (d) Record the year end closing journal entries. No explanation is required. (16 marks) Page 3 BHMH2101 2019/20 S2 Assignment Part II (30 marks) (Print this page and attach to your answer) Viva Company normally adjusts its books monthly. The Company has already recorded the following transactions in January but other than these NO other adjusting entries were made in January 2020. (1) On 1 January, 2020, it bought and recorded a $50,000 machine on credit. Estimated useful life of the machine is 50 months. (2) On 1 January 2020, it prepaid 1-year rent of $ 2,400 by cash for the year 2020. The total amount was recorded as rent expense. (3) On 31 January 2020, it recorded the purchase of a $30,000 computer by cash. But in fact the owner's son uses the computer for his personal study. (4) On 15 January a customer paid in advance $500 cash for services to be provided by the Company in February 2020. This amount was recorded as fees earned. (5) On 31 January Viva paid and recorded a total monthly salary of $50,000 to its 4 staff by cash. But each staff is also entitled for $100 overtime pay and the accountant did not pay nor accrue for this amount Required: (1) to (5) above are independent events. If no other adjusting entries were made in January as stated above, indicate their effects on the following elements of Souflave's book as at the end of January 2020. Present your answers in tabular format below. State O = overstated (with S amount), U = understated (with $ amount) and NE = no effect Revenue U$300 Expenses NE Profit U$300 Assets U $300 Liabilities NE Equity U$300 (1) (2) (3) (4) (5) (30 marks) END OF ASSIGNMENT 1 - Page 4