This is individual assignment and students are required to answer ALL questions.

finance

Description

 

INTI INTERNATIONAL UNIVERSITY

ACC2211 BUSINESS ACCOUNTING

JANUARY 2020 SESSION

 

INDIVIDUAL ASSIGNMENT

 

 

INSTRUCTIONS

 

1.      This is individual assignment and students are required to answer ALL questions.

 

2.      The due date for this assignment is on Wednesday, 26th February, 2020.

 

3.   Please use the cover page attached as the front page of your assignment.

 

 

GRADING

 

The total marks for this assignment is 100 and this contributes 20% towards the total grade of the course.

 

Upon completion of this assignment, students should be able to:  

 

LO1

Explain the accounting principles and the role of financial reports to users.

LO2

Explain the concept of accrual accounting and why it is used

 

 

OBJECTIVES

 

The concept of this assignment is to introduce students with the fundamentals and principles of financial accounting.  The objectives of this assignments are as follows:-

 

1.      To explain what is accounting.

2.      To explain the economic entity assumption.

3.      To analyze the effects of business transactions on the accounting equation.

4.      To explain accrual and cash accounting.

 

 

 

 

 

 

 

 

 

REQUIREMENTS

 

Answer ALL Questions.

 

Students may require the use of materials available in the subject module or textbook to complete the assignment. However, students are strongly encouraged to supplement the assignment from other textbooks, journals, magazines or articles.

 

 

SUBMISSION

 

The deadline for the individual assignment is on 26th February, 2020* before 12.00 noon.

* Late submission will cause a deduction of marks.

 

Submission of the assignment is at your respective lecturer’s office.

 

1.      Submission requirements:

Font: Times New Roman

Font size: 12 for content; 14 for subtitle; 16 for title; 10 for references

Spacing and alignment: 1.5, justified

 

NO comb binding and plastic cover sheets required.

STAPLED submission ONLY.

 

Any act of plagiarism is a serious academic offence and you may get an F for the subject.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PART A

 

Shirley spent much of her childhood learning the art of cookie-making from her grandmother.  They passed many happy hours mastering every type of cookie imaginable and later creating new recipes that were both healthy and delicious.  Now at the start of her second year in college, Shirley is investigating various possibilities for starting her own business as part of the requirements of the entrepreneurship program in which she enrolled.

 

A long-time friend insists that Shirley has to somehow include cookies in her business plan.  After a series of brainstorming sessions, Shirley settles on the idea of operating a cookie-making school.  She will start on a part-time basis and offer her services in people’s home.  Now that she has started thinking about it, the possibilities see endless.  During the fall season, she will concentrate on holiday cookies.  She will offer individual lessons and group sessions (which will probably be more entertainment than education for the participants).  Shirley also decides to include children in her target market.

 

The first difficult lesson is coming up with the perfect name for her business.  In the end. She settles on “Cookie Creations” and then moves on to more important issues.

 

Required:

 

Respond to the following discussion questions to help Shirley with her cookie making business.

 

a)      What form of business organization-proprietorship, partnership or corporation- do you recommend that Shirley use for her business? Discuss the benefits and weaknesses of each form and give the reasons for your choice.

 

(15 marks)

b)      Will Shirley need accounting information? If Yes, what information will she need and why? How often will she need this information?

                            (10 marks)

c)      Identify specific assets, liability, and equity accounts that Cookie Creations will likely use to record its business transactions.

(10 marks)

d)     Should Shirley open a separate bank account for the business? Why or why not?

                   (5 marks)

e)      At the end of the year, Shirley will have to prepare the financial statements for her company, Cookie Creations. Identify who are the internal and the external users of the financial statement?

(10 marks)

 

 

TOTAL: 50 MARKS

 

 

 

 

 

 

 

 

PART B

 

 

Miss Zarina started a consulting firm, Zarina & Co Consulting, on May 1, 2018.  The following transactions occurred during the month of May.

 

May 1

Zarina invested RM8,000 cash in the business in exchange for shares.

May 2

Paid RM800 for office rent for the month.

May 3

Purchased RM500 of supplies on account.

May 5

Paid RM50 to advertise in the County News.

May 9

Received RM3,000 cash for services provided.

May 12

Declared and paid a RM700 cash dividend.

May 15

Performed RM3,300 of services on account.

May 17

Paid RM2,100 for employee  salaries.

May 20

Paid for the supplies purchased on account on May 3.

May 23

Received a cash payment of RM2,000 for services provided on account on May 15.

May 26

Borrowed RM5,000 from the bank on a note payable.

May 29

Purchased office equipment for RM2,300 on account.

May 30

Paid RM150 for utilities.

 

 

 

 

Required:

 

Show the effects of the above transactions on the accounting equation using the following format:

 

Assets

=

Liabilities

 

Equity

Date

Cash

+

Ac Receivable

+

Supplies

+

Equipment

=

Notes

Payable

+

Ac Payable

+

Share

Capital

+

Retained

Earning

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rev

-

Exp.

-

Div

 

 

(30 MARKS)

 

 

 

PART C

 

 

The Orange Motel opened for business on May 1, 2019. Its trial balance before adjustment on May 31 is as follows:-

 

 

 

 

 

Continued…

Orang Motel

Trial Balance

May 31, 2019

 

Account Number                                                                               Debit               Credit

 

            101                              Cash                                                    2,500                                       126                              Supplied                                              1,520

            130                              Prepaid Insurance                               2,400

            140                              Land                                                  14,000

            141                              Buildings                                           58,000

            157                              Equipment                                         15,000

            201                              Accounts Payable                                                       4,800

            208                              Unearned Rent Revenue                                             3,300

            275                              Mortgage Payable                                                     38,000

            311                              Share Capital – Ordinary                                          40,000

            429                              Rent Revenue                                                           12,300

            610                              Advertising Expenses                           780

            726                              Salaries and Wage Expenses              3,300

            732                              Utilities Expenses                                 900

                                                                       

                                                                                                   RM98,400       RM98,400

 

In addition to those accounts listed on the trial balance, the chart of accounts for Orange Motel also contains the following accounts and account numbers: No. 142 Accumulated Depreciation-Buildings, No. 158 Accumulated Depreciation-Equipment, No. 212 Salaries and Wages Payable, No. 230 Interest Payable, No. 631 Supplies Expense, No. 711 Depreciation Expense, No. 718 Interest Expense, and No. 722 Insurance Expense.

 

Other data:

 

1. Prepaid insurance is a 1-year policy starting May 1, 2019

2. A count of supplies shows RM350 of unused supplies on May 31

3. Annual depreciation is RM2,640 on the buildings and RM1,500 on equipment

4. The mortgage interest rate is 12% (The mortgage was taken out on May 1)

5. Two-thirds of the unearned revenue has been recognized for services performed

6. Salaries of RM750 are accrued and unpaid at May 31.

 

 

 

Required:

 

Journalized the adjusting journal entries on May 31.

 

(20 MARKS)

 

[GRAND TOTAL: 100 MARKS]

 

 

 

 

 

 

COVER PAGE

 

 

 

INDIVIDUAL ASSIGNMENT

 

JANUARY 2020 SESSION

 

 

ACC2211

BUSINESS ACCCOUNTING

 

 

                        NAME : ____________________________________________

 

                        STUDENT ID NUMBER: _____________________________

 

                        CONTACT NO. (HAND PHONE): _____________________

 

                        COURSE : __________________________________________

 

   EXAMINER (LECTURER): ____________________________

 

 

 

ASSIGNMENT

MARKS

PART A

/50

PART B

/30

 PART C

/20

TOTAL

/100

 


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