2010-2011上学期Accounting 1B.doc

The First Semester of 20102011Yunnan University of Finance & Economics_Accounting 1_Final Examination Volume BMarkTotalModeratorMarkerNumber： Name： Class： Major： School：_ DAY &DATE: TIME:WRITING TIME: 180 minutesINSTRUCTIONS TO CANDIDATES: 1. Enter your name and student number in the space provided at the left of the test paper.2. This is a closed book examination; therefore no written material, reference books or notes will be permitted into the examination room.Part A (10marks)MULTIPLE CHOICE (1 marks each)Choose the one alternative that best completes the statement or answers the question.1)Purchasing a building for $120,000 by paying cash of $20,000 and obtaining a mortgage for $100,000 would:Aincrease assets and increase liabilities by $100,000Bincrease net assets by $100,000Cincrease liabilities by $120,000Ddecrease assets and decrease liabilities by $20,0002)Liquidity ratios measure:Athe short term ability of a company to pay its maturing obligationsBthe operating success of a company for a period of timeCthe ability of a company to survive over a long time Dthe extent to which a companys assets are financed by debtACC100 Page 9 of 9 pages3)Which is the correct order in which the following steps occur?1.Post to the ledger2.Prepare source document3.Enter in the journal4.Transaction occursA2,4,3,1B4,2,3,1C4,2,1,3D4,1,3,24)A company that receives money in advance of performing a service:Adebits cash and credits accounts payable Bdebits unearned revenue and credits accounts payableCdebits cash and credits unearned revenue Ddebits cash and credits accounts receivable5) If total liabilities decreased by $14,000 during a period of time and shareholders equity increased by $6,000 during the same period then the change in total assets is A an increase of $14,000B an increase of $20,000C a decrease of $8,000D an increase of $8,000 6)The entries which set the balances of the temporary accounts to zero are called:Aclosing entriesBbalancing entriesCcorrecting entriesDadjusting entries7)If revenues total $7,800 and expenses total $4,900 which journal entry properly shows the closing of the temporary accounts?ARetained Profits7,800Revenues 7,800BExpenses7,800Retained Profits7,800CProfit and Loss Summary2,900Retained Profits 2,900DRetained Profits7,800Profit and Loss Summary2,9008)In the current financial year Micro Services recorded the payment of $500 cash for a previously accrued expense and the accrual of $325 for another expense. The impact of these two entries on total expenses and net profit for the year is: Total Expenses Net ProfitAincrease by $825 decrease by $325Bincrease by $825 decrease by $825Cincrease by $325 decrease by $325Dincrease by $325 decrease by $8259)Which of the following is not an example of a special purpose journal?Asales journal Bcash receipts journalCcash payments journalDgeneral journal10)If the Johnson Company has the following opening account balances for debtors: $4,000, $5,000, $2,000; and cash received from debtors during the period amounted to $3,000, then the closing balance of the control account for accounts receivable isA$8,000B$11,000C$14,000D$3,000PART B (90 marks)ALL SIX QUESTIONS NEED TO BE ANSWEREDQuestion 1 Financial statement analysis (10 marks)The following information has been extracted from the financial statements and the notes of Anna Bean Pty Ltd.20062005Cash assets$32 500$36 000Receivables74 80077 000Prepaid expenses4 4006 600Property plant and equipment308 000269 500Current liabilities183 700167 200Sales979 000951 500Cost of Goods Sold587 400573 000Total liabilities593 000567 000Total assets650 000612 000Net profit98 00083 000Required:i) Calculate the following for 2006:1. Current ratio2. Gross profit ratio3. Debt to total assets ratio (6 marks)ii)Based on the information calculated write a brief report that comments on Anna Bean Pty Ltds liquidity, profitability and solvency. (4 marks)Question 2 Recording business transactions (10 marks)Mikes Bikes Pty. Ltd. opened a bike repair business on 1 July 2005. The following transactions occurred during the first month of operations:July1Shareholders invested $100,000 in the business in exchange for shares in the company.1Paid $24,000 for the first six months rent.1Paid insurance premium for the year of $1,200.2Paid Local Energy Corp $300 for a deposit on electricity.8Purchased workshop equipment for a total cost of $16,500 by issuing a cheque for $11,500 and signing a commercial loan agreement for $5,000.10Purchased supplies for $1,18016Recorded sales for the first half of the month of $6,480 in cash and $275 on account. 23Received a $50 payment from customers on account.28Paid salaries of $1,500.31Recorded revenue for the second half of the month of $12,729 in cash and $530 on account.Required:Prepare the general journal entries to record the above transactionsQuestion 3 Posting, adjusting entries and preparing financial statements (20 marks)Meccas Party Hire hires out equipment for parties. The unadjusted trial balance of the business appears as shown below.MACCAS PARTY HIREUnadjusted Trial Balanceas at 30 June 2008AccountDebitCreditCash at bank$5 200Accounts receivable7 310Prepaid insurance1 200Plant and equipment79 350Accumulated depreciation plant and equipment$40 600Accounts payable6 800Salaries payable-Share capital5 000Retained profits3 710Hire fees revenue74 700Depreciation expense-Insurance expense1,050Salaries expense26 500Rent expense5 700Maintenance expense3 100Electricity expense1 400_ $130 810$130 810The following information is supplied:1. Expired insurance amounts to $850.2. June electricity costs of $300 have not been paid or recorded.3. Depreciation on the plant and equipment is $7,270.4. The Rent Expense account accrued $660 for June 2008 rent have not been paid or recorded.5. Salaries accrued in June amounting to $540 have not been recorded.Required:1. Using the above information, prepare the adjusting entries for the moth of June. (explanations are required) (5 marks)2. Calculate the Net profit, Retained profit for the year ended 30 June 2008. (only calculation results are required) (6 marks)3. Calculate the Asset, Liabilities and owners equity as at 30 June 2008. (only calculation results are required) (9 marks)Question 4 Cash journals(10 marks)Gregs Glass Repairs Pty Ltd had the following cash related receipts during January 2006:Jan 1The owner Gregory Glenister invested cash of $25,000 in the businessJan 15Sold services for cash totalling $5,600Jan 18Collected $200 in settlement of Waynes World outstanding accountJan 23Received proceeds of $7,000 bank loan taken out to cover cash flow problemsJan 28Collected $150 in settlement of Fred Firkenstirkers outstanding accountRequiredUsing the following format:Gregs Glass RepairsCash Receipts Journal Cash Accts ReceivableSales Other AccountsDate Account creditedDR CR CR CRRecord the above transactions in the cash receipts journal.Question 5 Bank Reconciliation (15 marks)The following information is available for Forthright Investments regarding its 31 December 2005 bank statement Balance per bank statement is $10,300 Balance per books is $9,653 Cheque #412 for $1,948 and cheque #414 for $1,600 were not shown on the bank statement. A deposit in transit of $4,562 had not been received by the bank when the bank statement was generated. A bank debit memo indicated a dishonored cheque written by Bruce Garrett to Forthright Investments on 13 December for $279. A bank credit memo indicated a direct receipt of $1,975 into the bank on 20 December that was not recorded by the company. The bank statement indicated service charges of $35 that were not previously recorded by the company.Required:Prepare a bank reconciliation for Forthright Investments dated 31 December 2005 that includes adjustments to the General Ledger of the company.Question 6 Statement of Cash Flows (25 marks)You have been employed by Kamaria Limited to prepare its cash flow statement. The company provides you with its 2006 Statement of Financial Performance as follows:Kamaria LimitedStatement of Financial Performancefor the period ended 30 June 2006Sales$60 000Cost of Goods Sold 32 000Gross Profit$28 000Salaries expense$19 500Depreciation expense 3 000Total operating expenses$22 500Net Profit$ 5 500You determine that these numbers are correct. You review the companys beginning and ending balance sheets