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Class Exercise SESSION 1,2
Class Exercise SESSION 1,2
No.
1
2
3
What is accounting?
The Accounting Equation.
Users of Accounting.
How to do transactional analysis?
How to prepare journal entry.
How to post entries in ledger accounts.
How to prepare trial balance.
Q No.
2A-1
2A-6
2B-5
Page No.
93
96
99
Q No.1 Use following title of accounts to complete journal entries of given transactions.
CASH
A/C RECEIVABLE
A/C PAYABLE
RENT EXPENSE
DRAWING CAPITAL
SALARIES EXPENSE
EQUIPMENT
FURNITURE
SERVICE INCOME
SUPPLIES
1)
2)
3)
4)
5)
6)
7)
8)
9)
10)
A:
B:
C:
Q No.2
Write four steps of analysis for each transaction
1. Mr. Ahmed invested cash Rs. 125,000
2. Bought merchandise for cash Rs.20000
3. Paid rent for the month Rs.5000
4. Purchase office supplies for Rs.1500
5. Sold goods for cash Rs.5000
6. Purchase goods on credit from Nasir Ali Rs.10000
7. Paid salaries to office staff Rs. 12500
8. Paid to Nasir Ali Rs.3500
9. Sold goods on credit to Abid Rs.15000
10. Merchandise return to Nasir Ali Rs.250
11. Goods were returned by Abid Rs.750
12. Withdrew cash for personal use Rs.1000
13. Sold old machine at Rs.500
Q No.3
In July 2005, Nasir Jamal started business and completed following transactions.
July 1
July 2
July 7
July 12
July 17
July 20
July 23
July 27
INSTRUCTION
A:
Prepare journal entries
B:
Post to ledger accounts
C:
Prepare trial balance at July 31,2002
Q-4 Compute the missing amount in the accounting equation for each entity:
Company A
Assets
Liabilities
Owner's Equity
$61,800
$34,400
Athar Iqbal
athar@iqra.edu.pk
Company B
65,900
34,400
Company C
81,700
79,800
Q-5 Oracle Corporation started 19X9 with total assets of $5,819 million and total
liabilities of $2,861 million. At the end of 19X9, Oracle's total assets stood at $7,260
million, and total liabilities were $3,565 million.
Required
1. Did the owners' equity of Oracle Corporation increase or decrease during 19X9?
By how much?
2. Identify two possible reasons for the change in owners' equity of Oracle during
the year.
Q-6 Telemarketing Associates' balance sheet data at May 31, 20X2, and June 30, 20X2,
follow:
Total assets
Total Liabilities
$150,000
$195,000
109,000
131,000
Required
Following are three assumptions about investments and withdrawals by the owner of the
business during June. For each assumption, compute the amount of net income or net loss
of the business during June 20X2.
1. The owner invested $5,000 in the business and made no withdrawals.
2. The owner made no additional investments in the business but withdrew $11,000
for personal use.
Athar Iqbal
athar@iqra.edu.pk
3. The owner invested $41,000 in the business and withdrew $6,000 for personal
use.
Q. NO. 7
1. Khalid invested in business cash Rs.40000, office equipment Rs.60,000
2. Purchase merchandise for cash Rs. 6000
3. Purchase goods on credit from Zahid Rs.10000
4. Sold merchandise on credit to Amir Rs.10000
5. Paid rent expense Rs.600
6. Sold merchandise for cash Rs. 3500
7. Earned commission Rs. 10000
8. Purchase supplies on credit from Aleem Rs. 800
9. Paid traveling expense Rs. 650
10. Sold merchandise to Mr. Kareem Rs. 4000 on credit.
11. Khalid withdrew cash for personal use Rs. 3000
12. Rendered services to client and received commission Rs. 2000
13. Paid insurance for the month Rs. 500
INSTRUCTION
A:
Prepare journal entries
B:
Post to ledger accounts
C:
Prepare a trial balance at July 31,2002
Q. NO. 8
1. Khalid invested in business Rs.40000, Furniture Rs.24,000, equipment Rs.15000
2. Purchase merchandise for cash Rs. 6000
3. Purchase office stationary for Rs.2000
4. Purchase goods on credit from Zahid Rs.10000
5. Sold merchandise on credit to Amir Rs.10000
6. Paid rent expense Rs.600
7. Sold merchandise for cash Rs. 3500
8. Billed to Mr. Bilal for service rendered Rs. 10000
9. Purchase supplies on credit from Aleem Rs. 800
10. Paid traveling expense Rs. 650
11. Sold merchandise to Mr. Kareem Rs. 4000 on credit.
12. Received cash from Mr. Kareem Rs.1500
13. Khalid withdrew cash for personal use Rs. 3000
14. Paid insurance for the month Rs. 500
15. Received cash from Mr. Bilal Rs.8000
INSTRUCTION
A:
Prepare journal entries
Athar Iqbal
athar@iqra.edu.pk
B:
C:
Q-9 Helen Ingersoll owns and operates an interior design studio called Ingersoll
Interiors. The following amounts summarize the financial position of her business on
August 31, 20X2:
Assets
Bal.
= Liabilities +
Owner's
Equity
Helen
Accounts
Accounts
Ingersoll,
Cash + Receivable + Supplies + Land = Payable + Capital
2,250
1,500
12,000
8,000
7,750
Athar Iqbal
athar@iqra.edu.pk
Athar Iqbal
athar@iqra.edu.pk