Mr. Francis Chia is a successful management consultant and he employs several staff. The trial balance of his management consultancy firm, before the usual end period adjustments, is as follows: Trial Balance of FC Management Consultancy Pte Ltd as at 31 December 2005 DR CR S$ S$ Consultancy fee income 695,000 Staff salaries 408,050 Insurance 20,700 Office rental Electricity 19,700 8.135 Stationery & office expenses Telephone/Fax 3,240 15,320 Travelling/Transport expenses 42,320 Rental of cars 53,000 IT equipment & software (at cost) 23,700 Accumulated depreciation (IT equipment & Software) 12,400 Office furniture (at cost) 42,500 Accumulated depreciation (Office equipment) 10,300 Account receivables 82,500 Account payables 8,950 Bank 3,700 Paid up capital 31,515 Directors' drawings 43,000 762,265 762,265 It is necessary to make the following adjustments before the final accounts can be prepared: (a) A project worth $64,000 was completed on 30 December 2005. No invoice has yet to be raised. (b) Staff bonus of 5% of consultancy fee income has yet to be provided in the accounts. (c) Office rental includes S$1,515 relating to January 2006 and sum of $$3,250 for insurance relates to the next financial year. (d) It is estimated that electricity worth S$890 has been consumed but yet to receive the invoice. (e) Depreciation of S$6,200 on IT equipment & software and S$4,500 for office furniture has yet to be provided for. (f) On 25 December the Company entered into a hire purchase agreement, 100% financed by an finance Co. Bought a car, costing $52,800, total payable is $61,710, 60 monthly instalment of $1,029 (commencing on Jan 06) and a final instalment of $999. This entry is not included in the TB. (Do not provide for any depreciation) Required: a. Show the journal entries necessary for the above adjustments. AA / SN b. Prepare the balance sheet and profit and loss account for FC AA/SN Management Consultancy as at 31 December 20X0. c. What the accounting policy notes you need to disclose in the financial SN to Mgr statements? (Only the heading will do). d. How do you review revenue recognition and what information you SN to Mgr will request from Client? e. What would be the appropriate revenue recognition policy? f. What will be your audit query on asset purchased under HP? SS/Mgr AA / SN g. What are the major weaknesses you have noted? (Just put in point AA to Mgr form). h. What are the audit risk your will consider and your response SS/Mgr The client has given this job about 2 months ago and he had written an email asking for the progress of the job. All Draft an email explaining the delay and your explanation