Reference no: EM133013005

Accounting and Finance for Managers Assignment

Assignment One on General Overview of Accounting

Part I. Essay Writing Questions

1. Write suitable discussion related to (i) the definitions of accounting and the forms of the accounting as a discipline and (ii) the similarities and differences of Financial Accounting and Management Accounting.

2. Discuss the current accounting standards or principles applicable in Ethiopia as a base for financial statement preparation and presentation.

3. Explain the underlying prescriptions of IFRS

4. Describe five types of business transactions with external parties and another five types of business transactions from internal sources of a selected form of business company at your nearby (please indicate the form of company you selected on the answer sheet) and explain how they are journalized and then reported in the financial statements.

5. Discuss the accounting process as a cycle with a given period by explaining each of the steps and by giving practical examples.

6. Discuss the components in detail of the following financial statements for a manufacturing PLC:
a. Statement of Profit or Loss (Income Statement)
b. Statement of Financial Position (Balance Sheet)
c. Statement of Changes in Owners' Equity
d. Statement of Cash Flows

7. Explain cost accounting and its functions as well the distinguishing features of cost accounting systems for (a) job order costing, and (b) process costing

8. a. Give suitable explanation on (i) Cost; (ii) Cost Objects; (iii) Cost Driver
b. Discuss the different forms of Cost Classification

9. Discuss (i). the notions and purposes of CVP Analysis, and
(iii) the Components of CVP Analysis (Break-Even Analysis, Target Analysis, Margin of Safety Analysis, Sales-mix Analysis and others)

10. Discuss what forms of relevant information are applicable for business decisions related to Make or Buy Decisions, Accept or Reject Special Orders; Continue or Discontinue Business, and Sell or Process Further, and others

Part II. Work-out Questions

Question 1
Some selected balances of DD Co. for year ended Dec-31-2019 are as follows with their normal balances before adjustments:

Cash and Cash Equivalent Br 20,000                         Owners' Capital                                                                                    40,000

Notes Receivables	45,000	Retained Earnings	75,000
Office Supplies	12,000	Sales Revenues	640,000
Prepaid Insurance	72,000	Interest Income	12,000
Inventory (Average Cost)	24,000	Cost of Goods Sold	320,000
Fixed Assets	120,000	Selling Expenses	21,000
Accum. Depr- Fixed assets	36,000	Salary and Wages Expense	105,000
Unearned Rent (Liability)	56,000	Rent Expense	15,000

Required
a. Prepare the necessary adjusting entries for the following items as not yet recorded on Dec-31-2019:
i. The office supplies consumed during the year is Br 8,000
ii. The Unexpired part of insurance is only Br 26,000
iii. Br 30,000 is earned sales revenues from the unearned advance collection
iv. Salary and wages accrued as on 31-Dec-2019 amounts to be Br 18,000
v. Depreciation Expenses allocated for the year amounts to be Br 15,000
vi. There are accrued interest of Br 8,000 on the notes receivable
b. Prepare the following Financial Statements after adjustments on Dec-31- 2019.
i. Balance Sheet ii. Income Statement
c. Prepare closing journal entries after balances are adjusted and show the final closing of Income Summary to Retained Earnings

COMPREHENSIVE ACCOUNTING CYCLE PROBLEM

South Coast Boards Co. is a merchandising business. The account balances for South Coast Boards Co. as of July 1, 2010 (unless otherwise indicated), are as follows:

110	Cash	$ 63,600
112	Accounts Receivable	153,900
115	Merchandise Inventory	602,400
116	Prepaid Insurance	16,800
117	Store Supplies	11,400
123	Store Equipment	469,500
124	Accumulated Depreciation-Store Equipment	56,700
210	Accounts Payable	96,600
211	Salaries Payable	-
310	Rocky Hansen, Capital, August 1, 2009	555,300
311	Rocky Hansen, Drawing	135,000
312	Income Summary	-
410	Sales	3,221,100
411	Sales Returns and Allowances	92,700
412	Sales Discounts	59,400
510	Cost of Merchandise Sold	1,623,000
520	Sales Salaries Expense	334,800
521	Advertising Expense	81,000
522	Depreciation Expense	-
523	Store Supplies Expense	-
529	Miscellaneous Selling Expense	12,600
530	Office Salaries Expense	182,100
531	Rent Expense	83,700
532	Insurance Expense	-
539	Miscellaneous Administrative Expense	7,800

During July, the last month of the fiscal year, the following transactions were completed: July 1. Paid rent for July, $5,000.
3. Purchased merchandise on account from Belmont Co., terms 2/10, n/30, FOB shipping point,
$40,000.
4. Paid freight on purchase of July 3, $600.
6. Sold merchandise on account to Modesto Co., terms 2/10, n/30, FOB shipping point,
$25,000. The cost of the merchandise sold was $15,000.
7. Received $26,500 cash from Yuba Co. on account, no discount.
10. Sold merchandise for cash, $80,000. The cost of the merchandise sold was $50,000.
13. Paid for merchandise purchased on July 3, less discount.
14. Received merchandise returned on sale of July 6, $6,000. The cost of the merchandise returned was
$4,500.
15. Paid advertising expense for last half of July, $7,500.
16. Received cash from sale of July 6, less return of July 14 and discount.
19. Purchased merchandise for cash, $36,000.
19. Paid $18,000 to Bakke Co. on account, no discount.
20. Sold merchandise on account to Reedley Co., terms 1/10, n/30, FOB shipping point, $40,000. The cost of the merchandise sold was $25,000.
21. For the convenience of the customer, paid freight on sale of July 20, $1,100.
21. Received $17,600 cash from Owen Co. on account, no discount.
21. Purchased merchandise on account from Nye Co., terms 1/10, n/30, FOB destination, $20,000.
24. Returned $2,000 of damaged merchandise purchased on July 21, receiving credit from the seller.
26. Refunded cash on sales made for cash, $3,000. The cost of the merchandise returned was
$1,800.
28. Paid sales salaries of $22,800 and office salaries of $15,200.
29. Purchased store supplies for cash, $2,400.
30. Sold merchandise on account to Whitetail Co., terms 2/10, n/30, FOB shipping point,
$18,750. The cost of the merchandise sold was $11,250.
30. Received cash from sale of July 20, less discount, plus freight paid on July 21.
31. Paid for purchase of July 21, less return of July 24 and discount.

Instructions

1. Enter the balances of each of the accounts in the appropriate balance column of a four-column account. Write Balance in the item section, and place a check mark (?) in the Posting Reference column. Journalize the transactions for July.

2. Post the journal to the general ledger, extending the month-end balances to the appropriate balance columns after all posting is completed. In this problem, you are not required to update or post to the accounts receivable and accounts payable subsidiary ledgers.

3. Prepare an unadjusted trial balance.

4. At the end of July, the following adjustment data were assembled. Analyze and use these data to complete (5) and (6).

a. Merchandise inventory on July 31		$589,850
b. Insurance expired during the year		12,500
c. Store supplies on hand on July		314,700
d. Depreciation for the current year		18,800
e. Accrued salaries on July 31:
Sales salaries	$4,400
Office salaries	2,700	7,100

5. Enter the unadjusted trial balance on a 10-column end-of-period spreadsheet (work sheet), and complete the spreadsheet.

6. Journalize and post the adjusting entries.

7. Prepare an adjusted trial balance.

8. Prepare an income statement, a statement of owner's equity, and a balance sheet.

9. Prepare and post the closing entries. Indicate closed accounts by inserting a line in both the Balance columns opposite the closing entry. Insert the new balance in the owner's capital account.

10. Prepare a post-closing trial balance.

Attachment:- Accounting and Finance for Managers.rar