Question 1

On 1st January 2021, Bank Taqwa Berhad received an investment from Al-Farouq Berhad for of a sum RM2,000,000. The investment was split as follows:

Account	Allocation
Unrestricted Mudarabah Investment Account	60 %
Restricted Mudarabah Investment Account	40 %

The agreed profit sharing ratio for Unrestricted Mudarabah Investment Account was 80:20 to company and the bank respectively. Meanwhile, profit sharing ratio for Restricted Mudarabah Investment Account was 60:40, company and the bank.

On 1st July 2021, Al-Farouq Berhad invest additional RM500,000 into the Restricted Mudarabah Investment Account. Early December 2021, Bank Taqwa announce the following profit / (loss) before distribution to the depositors as follows:

URIA account	Profit / (Loss)
6 months & less	3.80%
12 months & less	4.50%
More than 12 months	5.20%

RIA account	Profit / (Loss)
6 months & less	(0.50%)
12 months & less	3.40%
More than 12 months	4.20%

The profit is payable on 31 December 2021. On 1stJanuary 2022, Al-Farouq Berhad withdraw RM200,000from the Unrestricted Mudarabah Investment Account.

Prepare the journal entries in the book of Bank Taqwa Berhad to record:

i. Investment received from Al-Farouq Berhad

ii. Payment of profit / to record loss to Al-Farouq Berhad

iii. Repayment of the investment to Al-Farouq Berhad

Question 1 investment from Al-Farouq Berhad for of a sum RM2,000,000. The investment was split as follows: The agreed profit sharing ratio for Unrestricted Mudarabah Investment Account was 80:20 to company and the bank respectively. Meanwhile, profit sharing ratio for Restricted Mudarabah Investment Account was 60:40, company and the bank. On 1st July 2021, Al-Farouq Berhad invest additional RM500,000 into the Restricted Mudarabah Investment Account. Early December 2021, Bank Taqwa announce the following profit / (loss) before distribution to the depositors as follows: The profit is payable on 31 December 2021. On 1st January 2022, Al-Farouq Berhad withdraw RM200,000 from the Unrestricted Mudarabah Investment Account. Prepare the journal entries in the book of Bank Taqwa Berhad to record: i. Investment received from Al-Farouq Berhad ii. Payment of profit / to record loss to Al-Farouq Berhad iii. Repayment of the investment to Al-Farouq Berhad