Reference no: EM13343438
Question
This question has 2 parts and you are required to answer both parts.
Part A
You have just received the 30 April 2011 bank statement for Swat Pte Ltd. To prepare the bank reconciliation, you gathered the following information:
- The company's general ledger cash account showed a balance of $25,216 on 30 April.
- The April bank statement showed a balance of $20,242.
- The April bank statement showed a NSF (Not Sufficient Funds) cheque in the amount of $888 from customer David Ong.
- The April bank statement showed interest revenue of $24.
- The April bank statement showed service charge of $10.
- The company has just deposited $4,000 in the bank. This will appear only in the May bank statement.
- The company has recorded a cheque incorrectly. The April bank statement showed a cheque payment of $980 to pay an account payable. However, the company has recorded this transaction as:
Dr Accounts Payable $880
Cr Cash $880
Required:
a) Prepare the bank reconciliation for Swat Pte Ltd.
b) Prepare the required journal entries for the April transactions (Explanations are not required).
Part B
The following situations involve accounting assumptions and principles:
i. Swat Pte Ltd recently bought six wastepaper baskets costing $10 each. This was recorded as an expense notwithstanding that the wastepaper baskets are expected to be used for five years.
ii. At the start of the year, Swat Pte Ltd bought a machine for $10,000. To better reflect the current market conditions, the company revised the accounting records of the machine from $10,000 to its current market value of $12,000.
For each of the above situations, indicate whether you agree or disagree with the accounting treatment. If agree, explain which assumption or principle supports the accounting treatment. If disagree, explain which assumption or principle is violated.
|
What rules and regulations would guide the actions
: Do you believe that you should listen to your supervisor and what rules and regulations would guide the actions that you would take?
|
|
Explain the financial effects of fifo and lifo
: Using the perpetual inventory system, determine the cost of goods sold for December 2010 and cost of inventory on hand at 31 December 2010 under the following cost flow methods.
|
|
Determine the initial cost of the machine
: On 1 January 2009, the machine was overhauled at a cost of $6,000. The overhaul extended its useful life from 5 years to 6 years.
|
|
Explain the molarity of the acetic acid solution
: A 20.0 mL sample of vinegar, which is an aqueous solution of acetic acid, , requires 19.5 mL of 0.700 M NaOH to reach the endpoint in a titration. What is the molarity of the acetic acid solution
|
|
Prepare the bank reconciliation for swat pte ltd
: For each of the above situations, indicate whether you agree or disagree with the accounting treatment. If agree, explain which assumption or principle supports the accounting treatment. If disagree, explain which assumption or principle is viol..
|
|
Describe the methods of revenue recognition
: Describe the methods of revenue recognition and GAAP method of revenue recognition fulfills the needs of the International Financial Reporting System?
|
|
Explain what is the h3o+ for a buffer solution
: What is the [H3O+] for a buffer solution that is 0.250 M in acid and 0.600 M in the corresponding salt if the weak acid Ka = 5.80 x 10-7? Use as example the following equation of a conjugate acid-base pair
|
|
Determine the depreciation expense
: Determine the depreciation expense, accumulated depreciation and net book value of the machine for the years 2007, 2008, 2009 and 2010.
|
|
At what minimum rate must the rocket consume fuel
: A rocket which has an exhaust speed of 8.0 km/s is to have a lift-off vertical acceleration of 8.0 m/s2 from the NASA launch pad. at what minimum rate must the rocket consume fuel
|