Basic Accounting

Basic Accounting (FNBE 0145)
Name : Teo Kean Hui
Student ID : 0310165
Course : FNBE March Intake 2012
Lecturer : Mr Chang Jau Ho

Basic Accounting

In this Foundation in Nature and Built Environment semester 2, Basic Accounting (FNBE 0145) is a selective subject that I've taken for replacing Maths subject.

There are a lot of topics found in Basic Accounting have been tough through out the semester such as Cash Flow Statement, Balance Day Adjustment, Trail Balance and so on. Among so many topic, my favorite topic is Balance Day Adjustment Part 1 and 2. By learning this topic, I'm able understand and have a solution if I receive or paid cash in advance or later. Receiving cash in advance is called prepaid revenue, receiving cash later on is called accrued revenue. While if paid cash in advance is called prepaid expenses, paid cash later on is called accrued expenses. The reason I like this topic is because it's complicated enough but I can still manage to understand these topics.

The topic I found that is useful is Profit & Lost Statement & Double Entry Recording and Trial Balance. This topic is about how to do and understand about Profit and Lost Statement and also Balance Sheet. This two statement are the main accounting statement that show you the position of your money, amount of assets and liabilities. I think this is useful in future so that I will not be easily cheated by accountant. Besides that, I can also check my own accounting statement to see the position of my money in future.

My other personal comments about this subject, overall is good. awesome lecturer and good slides. 
                                                     
                                                                                                                           [ 254 words ] 

Tutorial Question

Trial Balance Exercise 3

Ali and Mika run a partnership business that sells pastries (e.g. tiramisu cakes). The following is their trial balance for the 12-month period that ended on 31^st December 2012:

Accounts Capital Debtors Electricity Expenses Sales Sales Return Administrative Expenses Building Interest expense Bank Loan Freight inwards Creditor Sales Delivery expenses Accrued Salary expense Bad debt Inventory Drawings Cost of Goods Sold Shop Staffs’ Salary Cash Land Prepaid Advertising Expense

$ 37000 8510 3300 1790 154000 960 2740 3000 780 46500 15080 47490 24000 13280 25000 3600

$ 150400 110870 97240 26040 2480

Additional information

1) The business earned $830 of rent revenue but it remains un-received.

2) It incurred $2800 of advertising expense during the year.

3) It has incurred another $1500 of sales delivery expense, which remains unpaid.

4) The business was paid $7400 on balance day for consultation service that it will provide in the next accounting period.

Prepare the P&L statement and balance sheet for the partners.

Answer

Capital

Dec  31           Drawings                  $5000 Dec 31           Bal c/d                    $306100                                                      ________                                                      $311100

Jan 15          Office Apartment     $150000                              Cash                 $150000 Dec 31               P&L                     $11100                                                       $311100  Jan 1                Bal b/d                $306100

  

Cash

Jan 15                Capital                $150000 Apr 12            Bank Loan               $50000 May 17                 Sales                  $26000 Sep 20                Debtor                    $5000 Nov 19                   Sales                 $13000                                                      _______                                                      $244000 Jan 1                 Bal b/d                $166200

Feb 18            Inventory                 $15000 Mar 26            Salary Exp.                $7500 Mar 26            Utility Exp.               $1500 Mar 30            Warehouse              $30000 May 31             Drawings                 $5000 Jun 2               Interest Exp.              $2000 Jul 16                Inventory                 $7000                            Creditor                  $8000 Sep 6                 Creditor                   $1800 Dec 31              Bal c/d                 $166200                                                       $247000

Office Apartment

Jan 15                Capital                $150000                                                       $150000 Jan 1                 Bal b/d                $150000

Dec 31              Bal c/d               $150000                                                     $150000

     Inventory

Feb 18                  Cash                   $15000 May 17              Creditor                $12000 Jul 16                    Cash                    $7000 Aug 9                   COGS                  $1900                                                      _____                                                        $35900 Jan 1                  Bal b/d                  $8000

May 17              COGS                $12000 May 22              COGS                  $6700 Jul 14               Creditor                 $2000 Nov 19               COGS                  $7200 Dec 31               Bal c/d                 $8000                                                       $35900

Salary Expense

Mar 26                 Cash                     $7500                                                          $7500

Dec 31              P&L                    $7500                                                      $7500

Utility Expenses

Mar 26                 Cash                     $1500                                                          $1500

Dec 31              P&L                    $1500                                                      $1500

Warehouse Building

Mar 30                 Cash                   $30000                                                        $30000 Jan 1                 Bal b/d                  $30000

Dec 31              Bal c/d               $30000                                                     $30000

Bank Loan

Dec 31               Bal c/d                 $50000                                                       _______                                                        $50000

Apr 12                   Cash                  $50000                                                         ______                                                         $50000 Jan 1                 Bal b/d                  $50000

                                                               Sales Revenue

Dec 31              P&L                    $50000                                                                                                            ______                                                       $50000

May 17                   Cash                 $26000 May 22                 Debtor                $11000 Nov 19                   Cash                 $13000                                                         $50000

                                                                  Creditor

Jul 14             Inventory                   $2000 Jul 16                Cash                        $8000 Sep 6                Cash                         1800 Sep 6             Discount Exp              $200                                                         $12000

May 17              Inventory              $12000                                                         ______                                                        $12000

       Debtor

May 22               Sales                   $11000                                                        ______                                                        $11000 Jan 1                 Bal b/d                    $1900

Aug 9              Sales Return             $4000 Sep 20                   Cash                    $5000                         Discount Exp             $100 Dec 31              Bal c/d                    $1900                                                        $11000

Drawings

May 31               Cash                      $5000                                                          $5000

Dec 31              Capital               $5000                                                     $5000

Interest Exp.

Jun 2                  Cash                      $2000                                                         $2000

Dec 31              P&L                    $2000                                                      $2000

Cost of Goods Sold

May 17          Inventory                  $12000 May 22          Inventory                    $6700 Nov 19           Inventory                   $7200                                                         $25900

Aug 9              Inventory                  $1900 Dec 31              P&L                      $24000                                                         ______                                                         $25900

Sales Return

Aug 9                 Debtor                    $4000                                                           $4000

Dec 31              P&L                    $4000                                                      $4000

Discount Revenue

Dec 31              P&L                         $200                                                           $200

Sept 6              Creditor                    $200                                                         $200

Discount Expense

Sep 20         Debtor                            $100                                                            $100

Dec 31                 P&L                     $100                                                          $100

                                                               P&L Account

Dec 31             COGS                    $24000                     Sales return                  $4000                     Interest Exp                 $2000                        Salary Exp.                $7500                        Utility Exp.                $1500                    Discount Exp.                  $100                      Capital                       $11100                                                        $50200

Dec 31            Sales Revenue        $50000                          Discount Rev.          $200                                                        ______                                                         $50200

Ms. Sheppard’s Bathroom Renovation Store

P&L Statement for the 12-months ended 31 Dec 2012

Revenue Sales Less: Sales Return Net Sales Less: Cost of Goods Sold Cost of Goods Sold Gross Profit Add: Discount revenue Adjusted Gross Profit Less: Operating Expenses 1. General Expenses Salary                                                    $7500 Utility Exp                                              $1500 2. Financial Expenses Interest Exp                                           $2000 Discount Exp                                           $100 Net Profit/(Loss)

$ $9000 $2100

$ $50000 ($4000) $46000 $24000 $22000 $200 $22200 $11100 $11100

Ms. Sheppard’s Bathroom Renovation Store

Balance Sheet as at 31 Dec 2012

$                                                                       $ OWNER’ EQUITY Capital Add: Net Profit Less Drawings Represented by: ASSETS Current Assets Cash Inventory Debtor Non-current Assets Office Apartment Warehouse Building Total Assets LIABILITIES Non-current liabilities Bank Loan Total Liabilities NET ASSETS

$166,200 $8,000 $1,900 $150,000 $30,000

$176,100 $180,000 $50,000

$300,000  $11,100  ($5,000) $306,100 $356,100 $50,000 $306,100

 

Accounting Final Assignment

Basic Accountings