Assessment Task – Tutorial Questions Assignment 2
Unit Code: HA1020
Unit Name: Accounting Principles and Practices
Assignment: Tutorial Questions Assignment 2
Due: 11:30pm, 26th June 2020
Weighting: 25%
Total Assignment Marks: 50 Marks
Purpose:
This assignment is designed to assess your level of knowledge of the key topics covered in this unit
Unit Learning Outcomes Assessed:
1. Understand the logic and assumptions of accounting procedures;
2. Record business transactions in the journals and ledgers that make up a business accounting system;
3. Prepare financial statements; and
4. Analyse and interpret financial statements.
Description: Each week students were provided with three tutorial questions of varying degrees of difficulty. These tutorial questions are available in the Tutorial Folder for each week on Blackboard. The Interactive Tutorials are designed to assist students with the process, skills and knowledge to answer the provided tutorial questions. Your task is to answer a selection of tutorial questions for weeks 6 to 10 inclusive and submit these answers in a single document.
The questions to be answered are;
Week 6 – Question 1 (10 marks)
(Note this question is 2 in the Pre-recorded Tutorial Questions)
Peakhurst Limited had the following trial balance at 1 January 2016:
Debit $ Credit $
Cash 200 000
Accounts receivable 600 000
Inventory 700 000
Prepaid insurance 60 000
Prepaid rent 50 000
Equipment 1 000 000
Allowance for doubtful debt 20 000
Accumulated depreciation 200 000
Accounts payable 500 000
Revenue received in advance 100 000
Income tax payable 500 000
Loan 570 000
Share capital 400 000
Retained profits 320 000
2 610 000 2 610 000
You are given the following additional information for the year ended 31 December 2016:
a) Bad debts of $8000 were written off.
b) It was decided that allowance for doubtful debts should be 4 per cent of accounts receivable.
Required:
1) Prepare journal entries for these transactions. (4 marks)
2) Show the T-ledger accounts for the following for the year ended 31 December 2016:
a) accounts receivable (2 marks)
b) allowance for doubtful debts (2 marks)
c) bad debts expense (2 marks)
Week 7 – Question 2 (10 marks)
(Note this question is 2 in the Pre-recorded Tutorial Questions)
a) Compare the periodic versus the perpetual system as a control device. (4 marks)
b) What sort of organisations are likely to use the periodic inventory system? What kind of organisations will prefer to use perpetual inventory system? (3 marks)
c) If management overstated the valuation of inventory, would it affect profit for the year? (3 marks)
Week 8 – Question 3 (10 marks)
(Note this question is 3 in the Pre-recorded Tutorial Questions)
Perform a bank reconciliation.
a) Reconcile Jack Steel’s month end cash balance as of 31 Jul 2019 (8 marks)
b) Based on your analysis, propose adjusting entries (if any). (2 marks)
Transactions and balances:
• 31 Jul 2019 Bank Statement balance $ 58,791
• 31 Jul 2019 balance per Jack’s records $ 57,371
• Jack received a payment that he has not deposited $ 250
• Jack issued a cheque payable to Pandora’s Jewels to pay for a belated Mother’s Day gift to his grandmother that has not been presented to the bank $ 1,612
• Bank charges for the month of July were $40
• Interest on bank balance credited to Jack’s account $ 98
Week 9 – Question 4 (10 marks)
(Note this question is 3 in the Pre-recorded Tutorial Questions)
Murrays Ltd. purchased a new bus for $200,000. The company expects the bus to be used for trips between Sydney and Canberra for 10 years, or 800,000 miles, with an estimated residual value of $30,000 at the end of that time. During the 3rd year the bus was driven 96,000 miles. Calculate the depreciation expense for the 3rd year for each of the methods below. Show your solutions.
I. Straight-line (3 marks)
II. Diminishing balance at 20% p.a. (3.5 marks)
III. Units-of-activity (3.5 marks)
Week 10 – Question 5 (10 marks)
(Note this question is 3 in the Pre-recorded Tutorial Questions)
Banksia Company completed the following transactions during 2018-2019. The annual accounting period ends 30 June 2019.
a) Purchased inventory on credit at cost of AUD 16,800; perpetual inventory system is used.
b) Received a customer deposit of AUD 18,000 from ABC Ltd for services to be rendered in the future.
c) Borrowed AUD 900,000 from the bank on 1 March 2019 by giving the bank a six-month, 9% interest bearing note payable.
d) Performed AUD 8,000 of the services paid for by ABC Ltd; the rest will be rendered in August 2019.
e) Received the electricity bill for AUD 24,200, which will be paid in early July.
f) On 1 June 2019 received rent in advance of AUD 21,600 from XYZ Ltd for a 3 month lease of premises from 1 June until 31 August 2019.
g) Wages accrued in the last weekly payroll amounted to AUD 23,000 and will be paid on 5 July 2019.
Required:
1) Prepare the journal entries for each of these transactions. (7 marks)
2) Prepare all adjusting entries required on 30 June 2019. (3 marks)
Submission Directions:
The assignment has to be submitted via Blackboard. Each student will be permitted one submission to Blackboard only. Each student needs to ensure that the document submitted is the correct one. Academic Integrity
Academic honesty is highly valued at Holmes Institute. Students must always submit work that represents their original words or ideas. If any words or ideas used in a class posting or assignment submission do not represent the student’s original words or ideas, the student must cite all relevant sources and make clear the extent to which such sources were used. Written assignments that include material similar to course reading materials or other sources should include a citation including source, author, and page number.
In addition, written assignments that are similar or identical to those of another student in the class is also a violation of the Holmes Institute’s Academic Conduct and Integrity Policy. The consequence for a violation of this policy can incur a range of penalties varying from a 50% penalty through to suspension of enrolment. The penalty would be dependent on the extent of academic misconduct and the student’s history of academic misconduct issues. All assessments will be automatically submitted to Safe-Assign to assess their originality.
Further Information:
For further information and additional learning resources, students should refer to their Discussion Board for the unit.