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CONFIDENTIAL ACISEP 2013/ACC106/100/105/107/ 144/114/1151150 UNIVERSITI TEKNOLOGI MARA FINAL EXAMINATION COURSE : INTRODUCTION TO FINANCIAL ACCOUNTING AND REPORTING / ACCOUNTING / FINANCIAL ACCOUNTING 1 / ACCOUNTING 1 / INTRODUCTION TO ACCOUNTING 1 / FINANCIAL ACCOUNTING / PRINCIPLES OF ACCOUNTING 1 COURSE CODE : ACC106/100/105/107/111/114/115/150 EXAMINATION : SEPTEMBER 2013 TIME : 3HOURS INSTRUCTIONS TO CANDIDATES 1 This question paper consists of two (2) parts: PART A (10 Questions) PART B (4 Questions) 2 ‘Answer ALL questions in the Answer Booklet. Start each answer on a new page. 3 Do not bring any material into the examination room unless permission is given by the invigitator. 4 Please check to make sure that this examination pack consists of i) the Question Paper ii) an Answer Booklet ~ provided by the Faculty DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO This examination paper consists of @ printed pages (© Hak Cipta Universiti Teknologi MARA CONFIDENTIAL CONFIDENTIAL, 2 ACISEP 2013/ACC106/100/105/107/ 1111141151180 PARTA This part consists of ten (10) multiple-choice questions. Choose the most suitable answer. 1. What is the purpose of accounting? Provide financial information to the users. Assist the management to make decision. Can be used as a tool of performance evaluation. To increase the wealth of the business. 4, ihand ili (1 mark) 2. Which one of the following methods is used to calculate for depreciation? a. Accrual method b. Matching method Consistency method 4. Straight line method (1 mark) 3. At the end of a particular accounting period, accrued commission received would be shown in the Statement of Financial Position as a Current asset Current liability Revenue Capital aese (1 mark) 4. Which one of the followings is NOT the characteristics of Sales Ledger: It records the individual Accounts Receivable It records the total of credit sales only ‘The amount recorded in Account Receivable is taken from Sales Journal ‘The amount recorded in Account Receivable is taken from Sales Account (1 mark) poop 5. Allof the following are regarded as capital expenditure EXCEPT Cost of purchasing new fumiture for office use Petrol cost for delivering the goods to the customers Installation cost of an air conditioner in the office Cost of painting the office for the first time peop (1 mark) (© Hak Cipta Universiti Teknologi MARA CONFIDENTIAL CONFIDENTIAL 3 ACISEP 2013/ACC106/100/105/107/ 4911114/115/150 (© Hak Cipta Universiti Teknolog! MARA BB Trading purchased goods on credit from Shinhwa Sdn Bhd on 9 December 2012 with a credit term of 5/15, net 60. BB Trading paid RM10,970 on 17 December 2012. How much was the price of the goods purchased by BB Trading from Shinhwa Sdn Bhd? RM11,547 RM11,591 RM11,735 RM11,083 poop ‘Which of the following is classified as tangible assets Motor vehicles Debenture Office equipment Fumiture and fitings zeeo ii, iv i i, iv poop double entry system requires that each transaction must be recorded in a journal and in a ledger in two sets of books in at least two different accounts in a revenue account and in an expense account pese 4 Purchases journal is used to record the purchases of property, plant and equipment by cheque. record all cash received and cash paid. record the purchases of goods on credit. record the sales of goods by cash. aese Which one of the followings is NOT current asset? | (2 marks) (1 mark) (1 mark) (1 mark) (1 mark) (Total: 11 marks) CONFIDENTIAL CONFIDENTIAL 4 ACISEP 2013/ACC106/100/105/107/ 144/114/115/150 PARTB QUESTION 1 ‘A. Dr Colin Clark, a veterinar from Australia, has started a pet care business in Shah Alam. Her business was registered under the name of “Vet to Pet-Care Centre’. She invited her friend Dr Azimah Hashim to join her business. Dr Azimah contributed RM10,000 capital to the business. They hired 3 workers to help them in the business. A loan applied by Dr Colin from HSBC bank amounting to RM60,000 was also approved and used as capital in the business. RM40,000 of the loan received was used by Dr Colin to buy a van. She also used the money to buy veterinary equipment and pet care equipment. The van would be used by Dr Colin and Dr Azimah for traveling and visiting their customers’ places according to the appointment schedules. Cash payments were required for every visit they made. The business also offered other services such as pet consultancy and pet grooming at an affordable price. Required: a. Which form of business organisation have Dr Colin and Dr Azimah chosen for their business? (1 mark) b. State any three (3) characteristics of this form of business organisation, (3 marks) ©. State any two (2) benefits of this form of business organisation. (2 marks) d. List any three (3) possible revenues that the business will generate. (3 marks) e. State any three (3) kinds of expenses might “Vet to Pet-Care Centre” incurs. (3 marks) f. State any four (4) assets and four (4) liabilities that this business might have. (4 marks) B. Fillin the gaps below Expenses Assets Revenues Capital (RM) (RM) | (RM) (RM) 50,000 30,000 20,000 50,000 2 80,000 30,000 40,000 C 20,000 ? 40,000 30,000 40,000 80,000 2 20,000 30,000 700,000 | 60,000 2 ( marks) (Total: 21 marks) (© Hak Cipta Universiti Teknologi MARA, CONFIDENTIAL CONFIDENTIAL, 5 ACISEP 2013/ACC106/100/105/107/ 111/114/115/150 QUESTION 2 The following Trial Balance was extracted from the books of Victoria Enterprise as at 31 December 2012. Particulars Debit (RM) Credit (RM) Capital 331,180 Land and Building 150,000 Plant and Machinery 65,000 Furniture and Fittings 30,000 Motor Vehicles 89,000 7% Loan from Union Bank 70,000 Purchases and Sales 35,000 100,500 Inventories as at 1 January 2012 29,000 Return inwards and return outwards 3,500 2,000 Carriage Inwards 2,500 Carriage Outwards 1,500 Discount allowed and discount received 500 700 8% Fixed deposit 50,000 Cash in Hand 8,000 Cash at Bank 25,000 ‘Commission received 450 Accounts Receivable and Accounts Payable 19,000 10,000 Salaries and Wages 20,000 Electricity and Water 10,000 Rental expenses 10,000 Bad Debts 400 Allowance for Doubtful Debts 270 Interest on fixed deposit 4,000 Drawings 700 Accumulated Depreciation as at 1 January 2012: Plant and Machinery 6,500 Furniture and Fittings 5,700 Motor Vehicles 17,800 549,100 Additional information: a 2. Inventories as at 31 December 2012 was valued at RM19,000. Victoria Enterprise had 2 workers and they were paid RM800 per month. Both workers received in advance half of their salaries in December 2012. RM2,000 of rental was still accrued. Lygon Trading, one of the customers, was having financial difficulties and hence unable to settle their debts. The customer still owed RM350. Victoria Enterprise decided to write off the debts under the allowance method (© Hak Cipta Universiti Teknolog! MARA, CONFIDENTIAL CONFIDENTIAL, 6 ACISEP 2013/ACC106/100/105/107/ 114/114/115/150 5. Allowance for doubtful debts is to be increased to 3% of the remaining accounts receivable. 6. The loan from Union Bank was taken on 1 October 2012. No interest payment has yet been made. 7. Depreciation for the year were to be provided as follows: Plant and Machinery 10% per annum on cost Furniture and Fittings 10% per annum on book value Motor Vehicles 10% per annum on cost 8. — The owner of Victoria Enterprise withdrew goods worth RM400 for his personal use. The transaction was not recorded anywhere in the accounts. Required: a. A Statement of Profit or Loss (Statement of Comprehensive Income) for the year ended 31 December 2012. (16 marks) b. A Statement of Financial Position as at 31 December 2012. (12 marks) (Total: 28 marks) QUESTION 3 ‘A. The following information was extracted from Bendigo Trading as at 30 September 2012 Debit (RM) | Credit (RM) Purchases and Sales 80,000 120,000 [Inventories as at 1 October 2017 23,000 —_| Return inwards and retum outwards 7 1,200 2,100 Discount allowed and discount received 500 700 Rental Received 7,500 Salary and Wages 7,000 | Electricity and Water 5,000 ‘Accounts Receivable and Accounts Payable 75,000 20,500 Cash in Hand : 5,000 Prepaid Salary and Wages — 200 Accrued Electricity and Water _ 300 The inventories as at 30 September 2012 were RM20,000. (© Hak Cipta Universiti Teknologi MARA CONFIDENTIAL CONFIDENTIAL 7 ACISEP 2013/ACC106/100/105/107/ 111/114/115/150 Required: Calculate and provide a brief comment on the following ratios: a. Gross Profit Margin b. Net Profit Margin c. Inventory Turnover Ratio d. Current Liabilities e. Quick ratio (16 marks) B. List four (4) objectives of ratio analysis. (4 marks) QUESTION 4 (Total: 20 marks) Pinky Enterprise is a business selling various types of shoes since the year 2007. Below are ‘some of the transactions extracted from Pinky Enterprise for the month of May 2013: May 2013 2 30 31 Purchased of 10 pairs of shoes at a price of RM200 per pair from Mayers on credit Selena, purchased 5 pairs of shoes at a price of RM150 per pair. She paid by cheque Returned back 1 pair of shoes wrongly sent by Mayers. oe amount owing to Meyers by cheque Selena returned back two pairs of shoes wrongly ordered by her. Purchased a new computer for a business amounting to RM8,000. Bought inventories of shoes amounting to RM10,000 on credit. Linda, the owner of Pinky Trading, took RM2,000 cash from the business for her personal use. Linda injected capital RM2,000 cash Banked in all cash in hand. (© Hak Cipta Universiti Teknologi MARA, CONFIDENTIAL CONFIDENTIAL 8 ACISEP 2013/ACC106/100/105/107/ 1111114/115/150 Required: a. Show the effects (increase/decrease) of the above transactions on the accounting equation. (10 marks) State the accounts to be debited and the accounts to be credited for the above transactions. (10 marks) (Total: 20 marks) END OF QUESTION PAPER (© Hak Cipta Universiti Teknologi MARA, CONFIDENTIAL