Question 1 (Total 20 marks) On 1 July 2020, Anthony contributed $100 000 of his personal fund to begin his accounting services firm. The following business transactions occurred during the first month of his operations July 02 Paid rent for the premise of $12 000 for the full year. 03 Bought a computer system amount to $10 000 on credit. 04 Purchase office furniture costing $25 000. Paid $5 000 in cash and the balance on a short-term loan. 08 Received $5 000 in advance for accounting services to commence in August 2020 10 Anthony withdrew $1 100 from the business bank account for his personal use 15 Paid mid-month wages of $1 900 20 Earned $10 000 for services. Collected 60% in cash and the balance on a n/30 term. 25 Partial payment of $5 000 for the computer system bought on 03 July 2020.. 31 Wages owed to employees at the end of March are $1 900. Required: Prepare general journal entries for the business for March. Include narrations. (Assume GST does not apply). (20 marks) Question 2 (Total 13 marks) On 1 August 2019, John Wing set up John Music Enrichment Centre. On 31 July 2020 the Music Centre has the following balances extracted from the General Ledger Tuition fee receivable 5,600 Advertising expense 5,700 Cash at bank 28,700 Electricity expense 3,700 Accounts payable 11,200 Supplies expense 4,500 Music equipment 128,000 Telephone expense 2.500 Supplies 9,500 Wages 35,000 Johnson, E Capital 105,000 Tuition fees 120,000 Johnson, E Drawings 13.000 Required: a) Prepare an income statement for the year onded 31 July 2020 b) Prepare a statement of change in equity for the year ended 31 July 2020 c) Prepare a balance sheet in either account format or narrative format, as at 31 July 2020. (4 marks) (3 marks) [6 marks) Question 3 (Total 14 marks) In your audit on KC Enterprise, you noted the following discrepancies that need to be adjusted for the financial year ended 30 June 2020: 1. On 1 April 2020, KC Enterprise entered into an agreement to rent office space and paid $36 000 for the 12 month's rent. The total amount was charged to rental expenses. 2. Electricity expense for the month of June 2020 was not recorded. The amount owe is 3430 3. As at 30 June 2019, the Balance Sheet shows supplies at $10 000. On stock take the supplies on hand is $8 500 as on 30 June 2020 4. An unearned consulting fee of $4 200 has now been earned in the month of June 2020 5. On 1 July 2019, a purchase of an Office Equipment for $13000, with a useful life of 5 years and a residual value of $t 000. No depreciation was recorded. Required: a) Using the information above record the necessary adjusting entries in the general journal on 30 June 2020. Narrations not required (10 marks) b) Discuss the difference between accrued and deferred adjusting entries (4 marka) 2000 November ACCY 111 Singapore Campus November 2000 Question 4 (Total 14 marks) The following is the adjusted trial balance of Oak Tree Transport Services for the year ended 31 July 2020. Accounts Cash at Bank Accounts Receivable Prepaid Insurance Buses Accumulated Depreciation - Buses Accounts Payable Accrued Salary Long-Term Loan Sam, Capital Sam, Drawings Revenue Fuel Expense Depreciation Expense - Buses Repair and Maintenance Office Expense Wages Expense Adjusted Trial Balance Debit Credit 65,800 14,600 2,900 280,000 56,000 6,300 1,500 35,000 235.000 15,000 150,000 25,000 28,000 9.500 5,000 38,000 483,800 483,800 Required: a) Record the closing entries in the general journal for Oak Tree Transport Services Narrations are not required. b) Prepare a post-closing trial balance as at 31 July 2020. c) Discuss the importance of closing temporary accounts. (6 marks) (6 marks) (2 marks) 1 Question 5 (Total 13 marks) Cortina Trading, a retailer of a fine pen, commence business in the month of May 2020. The following is a list of transactions for the month of May 2020. May Purchased 200 pens for $100 each on credit. 2 Returned 12 pens to the supplier. Sold 50 pens to a customer each for $320 on credit. Purchased office supplies for $250 cash. Customers returned 6 pens sold on May 3. 6 Sold 52 pens for $340 each on credit. 7 The physical inventory count at the end of the period consisted of 90 pens in inventory. Required: Using the perpetual inventory system, record the above transactions in the general journal of Cortina Trading. Include narration (Assume GST does not apply). (13 marks) 3 4 5 Question 6 (Total 15 marks) The following information has been extracted from the financial statements of Foxboro Engineering Ltd. Account Cash assets Marketable securities Accounts receivables Inventories Prepaid expenses Property, plant and equipment Current liabilities Revenue (sales on credit) Cost of sales August-20 $ 28 000 102 000 67 000 177 000 4 000 295 000 173 000 950 000 570 000 August 19 $ 30 000 95 000 70 000 161 000 6 000 253 000 155 000 897 000 532 000 Required: a) Calculate the following ratios for the year 2020 to one decimal place. i) Current Ratio ) Quick Ratio m) Receivable Turnover Ratio M) Average Collection Period of Accounts Receivable ) Gross Profit Margin b) Comment on each ratio. (2 marks) (2 marks) (2 marks) (2 marks) (2 marks) (5 marks) Question 7 (Total 5 marks) Crystal Stationery uses a purchase Journal, a sales journal, a cash payment, a cash receipts journal, and a general journal. Indicate in which journals the following transactions are most likely to be recorded. 1. Purchased inventories on credit (1 mark) 2. Received cheque from a customer in settlement of their account. (1 mark) 3. Year end closing entries (1 mark) 4. Owner withdrew cash for personal use. (1 mark) Sales of inventories on credit (1 mark) 5 Question & Discuss the difference between management accounting and financial accounting (Total 6 marks) (3 marks each)