Notes:
- The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.
- Assignments submitted through email will not be accepted.
- Students are advised to make their work clear and well presented; marks may be reduced for poor presentation. This includes filling your information on the cover page.
- Students must mention question number clearly in their answer.
- Late submissionwill NOT be accepted.
- Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
- All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).
- Submissions without this cover pagewill NOT be accepted.
Assignment Question(S): (Total 25 Marks- -5 Questions Each Carries 5 Marks)
Q 1. In January 2023, ABC Sole Proprietorship Conducted the Following Transactions (Amounts in Saudi Riyal)
- Owner paid the capital for 5,000,000 in cash.
- It purchased equipment for 500,000 in cash.
- It purchased inventory for 2,000,000 in cash.
- It Sold inventory for 1,000,000 in cash.
- It Sold inventory for 200,000 on credit.
- It paid salaries for 250,000 in cash.
- It borrowed 500,000 from Riyadh bank by signing a promissory note.
- It purchased supplies for 100,000 on credit.
- It paid for the purchased supplies on credit.
- It collected the sold inventory on credit.
Required: Pass the Above Transactions in the Journal Using the Accrual Accounting
Answers:
Q 2. Discuss The Principles and Assumptions of the Accounting Theory.
Answer:
Q 3. In December 31, 2022 the accountant discovered the following information:
- Supplies purchased during the year and recorded as an assets were 20,000. As the Physical counting indicated that end of period supplies were 5,000.
- Cash received for 5,000 during the year against services not yet provided to the clients and recorded as earned revenues.
- Salaries for 25,000 incurred in the year but unpaid and unrecorded.
- Revenues for 50,000 earned in the year but uncollected and unrecorded.
- The annual Depreciation expenses for 10,000 unrecorded.
Required: Pass the required Adjusting Entries for the above Information.
Answer:
Q 4. Below Is the Adjusted Trail Balance for ABC Corporation as of December 31 2022:
| Items | Debit | Credit |
| Cash | 1,000,000 | |
| Accounts Receivable | 5,000,000 | |
| Supplies | 100,000 | |
| Equipment | 1,000,000 | |
| Accumulated Depreciation –Equipment | 200,000 | |
| Accounts Payable | 100,000 | |
| Notes Payable | 500,000 | |
| Unearned Revenues | 100,000 | |
| Common Stock | 4,600,000 | |
| Retained Earnings | 300,000 | |
| Dividends | 100,000 | |
| Sales | 10,000,000 | |
| Salaries Expenses | 1,000,000 | |
| Rent Expenses | 500,000 | |
| Cost Of Goods Sold | 7,000,000 | |
| Depreciation Expenses | 100,000 | |
| Total | 15,800,000 | 15,800,000 |
Required: Prepare the Following Statements
- Income Statement
- Retained Earnings Statement
- Balance Sheet Statement
Answer
Q 5. The following information extracted from the cost records during January 2023
| Dates | Particular | Units | Cost per unit | Total cost |
| January 1 | Begging inventory | 150 | 20 | 3,000 |
| January 10 | Purchase | 50 | 25 | 1,250 |
| January 20 | Purchase | 100 | 30 | 3,000 |
| January 25 | Sales | 200 |
Required:
- Compute The Cost of Goods Sold On January 25, 2023 Using First in First Out, Last in First Out and Weighted Average Methods
Principles of Accounting Assignment 2
Assignment Question(S): (Total 25 Marks- -5 Questions Each Carries 5 Marks)
In June 30, 2023, ABC Company has the following information (Amounts in Saudi Riyal)
Bank statement indicated a balance of 100,000
The cash general ledger account on that date shows a balance of 120,000
The ABC’s accountant provided Additional information necessary for preparing the ABC’s reconciliation statement:
- A 10,000 check sent to the bank for deposit but has not yet reached the bank at the statement date.
- The bank returned a customer’s NSF check for 26,000 received as payment on account receivable.
- A 500 deposit by Z Company was erroneously credited to ABC account by the bank.
- The bank statement showed 500 interest earned during June.
- Outstanding checks totaled 15,000.
Required:
- Prepare a June 30 bank reconciliation statement for ABC Company.
- Prepare adjusting entries
Answer:
Q 2. On July 31, ABC Company discovered that it cannot collect SAR 5,000 from Z a credit customer.
Required: pass journal entries to record bad debt expense using both Direct Write-Off Method and Allowance Method.
Answer:
Q 3. On January 1, 2022, equipment was purchased for SAR 1000,000 cash. The equipment useful life is 10 years and has an estimated salvage value of SAR 50,000.
Required:
- Compute the annual depreciation expense for year 2022 using straight line method and Declining Balance Method.
- Pass journal entries to record the annual depreciation using straight line method and Declining Balance Method.
Answer
Q 4. On July 1, 2022, an airline company received an amount of SAR 100,000 for international flights that will take off on December 30, 2022.
Required:
- Prepare journal entries On July 1, 2022
- Prepare journal entries on December 30, 2022 assuming that the airline provided the service to customers.
Answer:
Q 5. Define and Discuss the Accounting Treatment for Contingent Liabilities