Q1:

Sun packaging is a profit-making manufacturing company established during 1998. The company is not fulfilling their responsibility towards their stakeholders. They do not provide fair wages to the employees and the company did not disclose all the financial information to their stakeholders about the company.

i. Who are classified as stakeholders? [1 mark]

ii. Discuss how each stakeholder will be affected? [3 marks]

iii. Which principles or concepts of accounting is affected if they do not disclose the information? [1 Mark]

Mr Amjad is planning to start a business. He follows various accounting concepts and conventions which helps his business run smoothly.

i. Which accounting concept help him to assume that the revenue is realized?

[1 Mark]

ii. Which could be the different basis of accounting that can help him recording the revenue realized. Explain with examples.

Q3

Ms. Marwa started a flower shop during May 2018, Prove the accounting equation by balancing the following items.

Capital OMR 25,400; Accounts Payable OMR 2,600; Fixtures OMR 2,800; Car OMR 3,900; Stock of goods OMR 4,550; Accounts Receivable OMR 2,780; Cash at bank OMR 6,750; Cash in hand OMR 7,220.

During the first week of May 2018, if the following transaction takes place how the accounting equations changes:

i. She bought extra stock for goods OMR 500 on Credit. [3 Marks]

ii. She bought a computer by cash OMR 750.

You are required to prove the accounting equation as on 7th May 2018 after completing the above transactions.

[Use the following tables]

Assets Amount in OMR Capital + Liabilities Amount in OMR

Total Total

She bought extra stock for goods OMR 500 on Credit.

Assets Amount in OMR Capital + Liabilities Amount in OMR

Total Total

She bought a computer by cash OMR 750.

Assets Amount in OMR Capital + Liabilities Amount in OMR

Total Total

Q4

Journalize the following transactions in the books of a trader for the month of Feb. 2020. [10 Marks]

2020

Feb. 1 Started business with OMR 100,000 and from which paid into bank OMR 30,000.

5 Bought on credit furniture for OMR 5,000 and Machine for OMR 4,000.

8 Purchased goods for OMR 20,000 on credit.

10 Sold goods to Ahmed on cash for OMR 15,000.

15 Amount withdrawn from bank for personal use OMR 3,000.

18 Deposited into bank OMR 5,000.

20 Sold goods to Ali for OMR 10,000 and received OMR 7,000 in cash but remaining on account.

22 Paid OMR 1,000 for stationary.

25 Paid rent OMR 500.

28 Sold furniture on account for OMR 1,500.

Q5

Post the transactions given in Question - 4 to the proper ledger accounts.