Demonstration of using the table template for calculations in Question 1:

Sample Required:

Calculate purchases of inventory in a period

	Opening Inventory	66,000
+	Purchases of inventory	x = $297,000
-	Closing Inventory	(82,000)
=	COGS	281,000

purchases of inventory = x = $297,000

Question 1 (13 marks)

Part A

1. If you do not need both tables for your workings, delete one of them.

	Opening
+
-
=

	Opening
+
-
=

cash received from customers = $

2. If you do not need both tables for your workings, delete one of them.

	Opening
+
-
=

	Opening
+
-
=

cash paid for insurance = $

3. If you do not need both tables for your workings, delete one of them.

	Opening
+
-
=

	Opening
+
-
=

Question 1 (13 marks) Part A The following financial information is available for Excellent Ltd. All sales and purchases of inventory were on credit. "Other expenses" excluded the costs of goods sold (COGS) and wage expenses, however, this item included $27,000 depreciation expense and $4,000 insurance expense. During the period, equipment acquired at $30,000 with a carrying amount of $17,000 was sold for $26,000 cash. Ignore tax. Excellent Ltd Balance Sheets as at 30 June 2019 2020 Assets Cash $ 6,500 $ 23,000 Accounts receivable 37,500 33,500 Inventory 66,000 82,000 Prepaid insurance 3,500 2,500 Land 90,000 40,000 Equipment 300,000 360,000 Accumulated depreciation - Equipment (67,000) (81.000) Total Assets 436,500 460,000 Liabilities Accounts payable 32,000 20,000 Wage payable 6,000 5,000 Other expenses payable 4,500 5,000 Long-term loan 120,000 125,000 Total Liabilities 162,500 155,000 Net Assets 274,000 305,000 Equity Share capital 170,000 170,000 Retained earnings 104,000 135,000 Total Equity 274,000 305,000 Excellent Ltd Income Statement For the year ended 30 June 2020 Sales Cost of sales GROSS PROFIT Other income: Income on sale of property $ 427,500 (281,000) 146,500 9,000 155,500 Expenses: Wage expense Loss on sale of land Other expenses Total expenses PROFIT (11,500) (10,000) (107.000) (128,500) $ 27,000