Question .jpg”> Principles of Accounting BAP 11

29 Jun Question .jpg”> Principles of Accounting BAP 11

Question
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Principles of Accounting

BAP 11

Assignment 1 2013

Semester 3

Class Day/Time: ________________

Due Date: Week 6 Friday 17th January 2014

Time: 5 PM

Total marks for all questions 75

Weight: 25%

This is an individual assignment.
The assignment consists of 6 questions all of which are to be attempted. Please submit into Moodle directly, by the due date. Late submissions will attract a penalty of 5% for each day it is late.

This assignment must be your own work and submitted with an assignment cover sheet.
Question 1. 25 marks

The following questions are required to be answered relate to the course text

Questions

a) Statement of Cash flows direct method Chapter 18 ;

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Required

i. Prepare a cash flow statement using the direct method for operating cash flows

ii. Prepare a reconciliation of the [profit and cash provided by the operations

b) Bank reconciliation 5 marks

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Required prepare a bank reconciliation for the Month ended the 31 March 2001

c) Accounting for Shares 10 marks

Demons Ltd issued a prospectus for the issue of 100,000 $5.00 shares on 1 January2012.The prospectus required payment of $3.00 per share on application and $2.00 to be paid when called.

The company received applications for 120,000 shares by the closing date of 28February 2012.100,000 shares were issued on 1 March 2012 with excess application money being refunded.

On 30 April 2012 the company called the balance of $2.00 on the shares. All call money was received by 15 May 2012.On 30 June 2012 Demons Ltd declared and paid a dividend of 5 cents per share.

Required:

Prepare the journal entries for the year ended 30 June 2012 to account for the above transactions.

d) Accounting for Liabilities 5 Marks

Easy Company Ltd issues a debenture at a premium for a period of 10 years the company pays interest on 31 December and 1 July. The debenture has a par value of $1,000,000.00 and is issued at premium of 105 at an interest rate of 9%

Prepare journal entries to reflect the following;

i. issue of debentures on 1-July

ii. payment of interest on 1 January

iii. accrual on 31 March

e) Accounting for Inventory 10 marks

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f) Analysis of Accounting Information 10 Marks

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g) Preparation of production and cash budget 10 marks

Budget data

unit sales

January

25,000.00

February

30,000.00

March

32,000.00

selling price

$ 10.00

per unit

cash sales

20%

during month of sale

Collections on account

50%

in month of sale

Collections on account

25%

after month of sale

Amount uncollectable

5%

balance on accounts receivable at 1 January

$ 420,000.00

Of which $350,000 relates to December sales and the remainder related to November sales

5% of the total balance is uncollectable

1

prepare sales budget for the quarter

2

prepare cash collections budget for the quarter

3

Calculate the balance in accounts receivable at the end of March