Reference no: EM132808875
HC1010 Accounting for Business - Holmes Institute
Learning Outcome 1: Obtain and contextualise business information for business accounting to explain and apply different concepts of costs to business decisions;
Learning Outcome 2: Apply, analyse, synthesise and evaluate information from multiple sources to make decisions about the financial performance of entities including assets, liabilities, owner's equity, revenue and expenses;
Prepare, analyse, and interpret transaction data and financial statements for data driven decision- making;
Learning Outcome 3: Evaluate the complex concepts of accounting such as roles and purposes of accounting and preparation of worksheets; and
Learning Outcome 4: Communicate accounting information in writing professionally.
Question 1
In your opinion, should corporate governance practices be included as part of legislation or is it preferable to allow organisations to self-regulate and hence, choose their own suitable corporate governance practices and structures?
Required:
Discuss and provide an appropriate justification.
(Word Limit is 200 - 250 words)
Question 2
Required:
Prepare a balance sheet in a narrative format based on the following list of information, as shown in the table below:
|
Account
|
Amount
|
|
Owners' Equity
|
?
|
|
Cash
|
2 700
|
|
Accounts payable
|
43 250
|
|
Inventory
|
31 125
|
|
Motor vehicles
|
18 200
|
|
Bank overdraft
|
33 500
|
|
Accounts receivable
|
2 250
|
|
Wages and salaries expenses
|
5500
|
|
Office equipment
|
4 600
|
|
Loan to director
|
22 000
|
Question 3
EP Lawyers operates a number of Law firms in Melbourne and Sydney. The following information listed in the table below relates to a number of accounts from the trial balance of EP Lawyers (post adjustments) for the year ending 30 June 2019.
|
Accounts
|
$
|
|
Accounts payable
|
96 000
|
|
Telephone expense
|
30 285
|
|
Services revenue
|
663 750
|
|
Buildings
|
650 000
|
|
Office equipment
|
18 000
|
|
Cash at Bank
|
71 020
|
|
Advertising expense
|
30 375
|
|
Accounts receivable
|
108 000
|
|
Salaries & Wages
|
191 700
|
|
Mortgage payable
|
870 000
|
|
Office supplies
|
27 000
|
|
Capital
|
355 885
|
|
Office materials expense
|
137 565
|
|
Drawings
|
67 500
|
|
Land
|
360 000
|
|
Rent expense
|
60 390
|
|
Utilities (gas/water, etc.)
|
71 910
|
Required:
a) Based on the information provided in the table above, prepare the Income Statement for EP Lawyers.
b) In your own words, explain what the purpose of a statement of comprehensive income is and who do you think would use it? Justify your answer.
(Word Limit: 150 - 250 words)
Question 4
The following information about John Corp. applies to the entity for the year ending 30 June.
|
Payment to suppliers
|
150 000
|
|
Receipts from owners
|
405 000
|
|
Receipts from long-term borrowing
|
270 000
|
|
Payment of rates
|
130 000
|
|
Payment of wages
|
125 000
|
|
Purchase of land
|
90 000
|
|
Repayment of long-term borrowing
|
165 000
|
|
Receipts from customers
|
600 000
|
|
Payment for equipment
|
190 000
|
|
Depreciation on equipment
|
90 000
|
Required:
a) What was John Corp.'s cash flow from the following three (3) activities?
o Operating Activities
o Investing Activities
o Financing Activities
b) In your own words, explain the difference between the cash and accrual basis of accounting.
(Word Limit: 150 - 250 words)
Question 5
The following information shown in the table below relates to Maxi Pty Ltd for the years ending 30 June 20X7 and 30 June 20X8:
|
Accounts
|
Year 20X8
$
|
Year 20X7
$
|
|
Total current assets
|
2,820,000
|
2,570,000
|
|
Total Non-current assets
|
2,700,000
|
2,400,000
|
|
Total current liabilities
|
1,770,000
|
1,350,000
|
|
Total non-current liabilities
|
990,000
|
1,000,000
|
|
Owners' equity
|
2,760,000
|
2,600,000
|
|
Annual sales
Net profit (after tax)
|
6,100,000
732,000
|
3,154,350
475,200
|
Required:
a) Calculate the following financial ratios for Maxi Pty Ltd for the year ending 30 June 20X8
o Net Profit Margin
o Asset Turnover
o Debt to Asset Ratio
o Current Ratio
b) In your own words, discuss three (3) limitations of ratio analysis as an analytical tool.
(Word Limit: 250 - 300 words)
Question 6
Required:
In your own words and by providing appropriate examples, explain the main advantages of identifying cash surpluses and deficits in a cash budget.
(Word Limit: 250 - 300 words)
Attachment:- Accounting for Business.rar