04 Oct Financial Reporting Principles,
The following information is given about Nadak Co.:
1. The August 31 balance shown on the bank statement is $9,810.
2. There is a deposit in transit of $1,260 at August 31.
3. Outstanding cheques at August 31 totalled $1,890.
4. A bank charge of $40 for cheques was made to the account during August, as shown on the bank statement. Although the company was expecting a charge, its amount was not known until the bank statement arrived.
5. In the process of reviewing the cheques, it was determined that a cheque issued to a supplier in payment of accounts payable of $361 had been recorded as $631.
6. The August 31 balance in the general ledger Cash account, before reconciliation, is $8,950.
Required:
Part A: Prepare a bank reconciliation as of August 31, 2011.(4 marks)
Part B: Prepare any necessary adjusting journal entries.(2 marks)
QUESTION 2 (9 Marks) Financial Reporting Principles, Accounting Standards and Auditing, & Sustainability Reporting
Provide short answers to the following:
1. What are generally accepted accounting principles?(2 Marks)
2. Going concern assumption is one of the key assumptions to financial reports. What is going concern assumption? Why is assumption important in the preparation of financial statements?(4 marks)
3. Describe Scope 1 and Scope 2 emissions and provide an example for each of them. (3 marks)
QUESTION 3 Financial Statement Analysis (8 marks)
BPS Ltd, a supplier of telecommunications equipment, retails its products through suburban outlets. Shown below are the calculations of some of its key financial ratios for 2011 and 2012.
2012 2011
Return on Equity 13% 12%
Return on Assets 8% 9%
Profit margin 20 18%
Asset turnover 0.40 0.50
Days in inventory 72 days 55 days
Days in debtors 42 days 42 days
Current ratio 1.6 1.5
Quick ratio 0.7 1.1
Debt-to-Equity ratio 1.4 1.0
Return on Equity Operating Profit after Tax/ Shareholders’ Equity
Return on Assets Operating Profit after Tax/Total Assets
Financial Leverage Total Assets/Total Shareholders’ Equity
Profit Margin Earnings Before Interest and Tax/Sales
Asset Turnover Sales/Total Assets
Days in Inventory Average Inventory/ COGS x 365
Days in Debtors Average Trade Debtors/Credit Sales x 365
Current Ratio Current Assets/Current Liabilities
Quick Ratio Current Assets – Inventory/Current Liabilities
Debt to Equity Ratio Total Liabilities/Total Shareholders’ Equity
Required
Analyse BPS’s profitability, asset management,liquidity and financial structure for 2012 using the ratio information.
QUESTION 4 (15 marks)Control Accounts
Rupert Ltd maintains subsidiary ledgers for debtors and creditors. At 31 May 2014, the debtors control account has a debit balance of $50,120 and the creditors control account has a credit balance of $30,670. An extract of totals from the special journals for the month of June 2014 is as follows:
Our website has a team of professional writers who can help you write any of your homework. They will write your papers from scratch. We also have a team of editors just to make sure all papers are of HIGH QUALITY & PLAGIARISM FREE. To make an Order you only need to click Ask A Question and we will direct you to our Order Page at WriteDemy. Then fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Fill in all the assignment paper details that are required in the order form with the standard information being the page count, deadline, academic level and type of paper. It is advisable to have this information at hand so that you can quickly fill in the necessary information needed in the form for the essay writer to be immediately assigned to your writing project. Make payment for the custom essay order to enable us to assign a suitable writer to your order. Payments are made through Paypal on a secured billing page. Finally, sit back and relax.
About Writedemy
We are a professional paper writing website. If you have searched a question and bumped into our website just know you are in the right place to get help in your coursework. We offer HIGH QUALITY & PLAGIARISM FREE Papers.
How It Works
To make an Order you only need to click on “Order Now” and we will direct you to our Order Page. Fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Are there Discounts?
All new clients are eligible for 20% off in their first Order. Our payment method is safe and secure.