Answer ALL Questions in the Answer Booklet QUESTION 1 (20 MARKS)

Ruby, opens her own law office, Ruby Associates (RA) which started the operation on 1st January 2019. RA operates in Johor Baharu, Johor, Malaysia. On 1st January 2019, Ruby introduced cash of RM155,000, an brought in her personal equipment that cost RM17,000 and motor vehicle at the cost RM45,000 for business use. During the month, RA earned revenue RM15,080 by cash from the services rendered. RA had paid the following expenses by cash: RM Salaries 5,000 Rent 3,200 Stationeries 1,500 Trade creditors/ Accounts payable RM3,700 was identified by end of the month. On 31st January 2019, Ruby introduced RM10,000 for additional investment. She recorded this transaction as an increase cash and increase in revenue. Required: a) Identify the companys Assets, Liabilities, Equity at the end of January 2019. ( 7 marks) (CLO3:PLO4/PLO7:C4) b) Calculate the net income (or net loss) for the month of January 2019. (5 marks) (CLO3:PLO4/PLO7:C4) c) Provide your comment about the accounting treatment for additional investment made by Ruby on 31st January 2019. (5 marks) (CLO3:PLO4/PLO7:C4) TIME: 3 HOURS _____________________________________________________________________________________ ACCT1002/June2021 Page 3 of 7

d) Assume that Ruby Associates is in the process of applying financing facility from MyBank. For that purpose, MyBank requires RA to submit the companys financial statements to be reviewed by the bank. Required: i. Why MyBank request the financial statements? Give TWO (2) reasons. ( 4 marks) (CLO3:PLO4/PLO7:C4) ii. Identify and explain the relevant information from the financial statements the important for MyBank in making decision. ( 4 marks)