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PRINCIPLES OF ACCOUNTS

Prepared by: Hajah Marhani & Hajah Harita


Year
9
1




Exercise: Classification of Accounts

Premises
Real
Capital
Personal
Drawings
Personal
Interest
Nominal
Mc Donald
Personal
Building
Real
Machinery
Real
Salaries
Nominal
Unitec Co.
Personal
Cash
Real
Rent and rates
Nominal
Abu Bakar
Personal
Advertising
Nominal
Motor repairs
Nominal
Fixtures and fittings
Real
Furniture
Real



Account
Debited
Account
Credited
1 Purchased goods from Lina Purchases Lina
2 Commission received in cash Cash Commission Rec
3 Rent paid in cash Rent Cash
4 Cash sales Cash Sales
5 Insurance paid in cash Insurance Cash
6 Cash purchase of a delivery van Motor Vehicles Cash
7 Payment of office equipment in cash Office equipment Cash
8 Goods returned by Ramadhan Sales Return Ramadhan
9 Goods drawn out by proprietor for own use Drawings Purchases
10 Credit purchases of machinery from Avis Ltd Machinery Avis Ltd
11 Bought fixtures on credit from Ayu Fixtures Ayu
12 Return goods to Naseer Naseer Purchases Return
13 Miscellaneous expenses paid in cash Miscellaneous Exps Cash
14 Cash brought in by owner as capital Cash Capital
15 Interest on loan, paid by cheque Interest on loan Bank
16 Discount allowed to buyer, Arthur Discount allowed Arthur
17 Carriage paid in cash Carriage Cash
18 Discount received from Aminatul Ltd Aminatul Ltd Discount Rec
19 Withdraw goods for personal use Drawings Purchases
20 Took out money from bank account for own use Drawings Bank
Topic 1: Introduction to Accounting World
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
2

Exercise A
Match with the correct answers:

1. A financial activity of a business is called
a____________ ____

Business entity
concept
2. The process of recording business transactions is called
___book-keeping_____
Prudence Concept
3. The process of recording, classifying, analyzing and
interpreting business data is called
_______accounting_____
Book-keeping
4. The concept which defines business and owner as
separate entities is called ______business entity
concept______
Accounting periods
5. The concept which assumes that a business will
operate indefinitely is the _______Going concern
concept_______
transaction
6. The concept which does not overstate profits and
assets is the ___Prudence concept____
Consistency Concept
7. The concept which maintains the same methods and
practices for all accounting periods is the
____Consistency Concept_____
Going concern
concept
8. Final accounts are prepared at fixed intervals called
______Accounting periods____
accounting

Exercise B

1) c
2) b
3) a
4) b
5) d
6) a
7) d
8) d
9) a
10) d







MULTIPLE-CHOICE QUESTIONS

1. d
2. c
3. d
4. d

Topic 2: Accounting and Information Technology
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
3





Exercise A



































Exercise B

ASSETS LIABILITIES OWNERS EQUITY
1. $30,000 $10,000 ? $20,000
2. $80,000 ? $45,000 $35,000
3. ? $78,000 $18,000 $60,000
4. $55,000 $16,000 ? $39,000
5. ? $100,000 $30,000 $70,000
6. $90,000 $34,550 ? $55,450
Exercise C
What the business
Owes
What the business
Owns
Owners Investment
Asset
Liabilities
Owners Equity
Classification:
Fixed Assets
Current Assets
Classification:
Long-term Liabilities
Current Liabilities
Type:
Cash
Non-Cash
Examples:
Premises
Cash
Debtors
Stock

Examples:
Loans
Creditors
Bank Overdraft

Sources of Finance:
Personal Savings
Bank Loans
Borrowings from
friends

Accounting Equation:

A = L + OE
Accounting Equation:

L = A - OE
Accounting Equation:

OE = A - L
Relationship with Expenses and Revenues
Revenues increase
assets
Expenses decrease
assets
Expenses increase
liabilities
Revenues decrease
liabilities
Revenues increase
Owners Equity
Expenses decrease
Owners Equity
Topic 3: Accounting Equations
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
4
From the information given below, calculate the owners equity as at 31 December 2006:
$
Cash in hand
Debtors
Creditors
Bank Overdraft
Stock
Motor Vehicles
Office Equipment
Loan from bank
Premises
1,500
5,600
6,800
1,800
20,000
30,000
10,000
15,000
50,000


Exercise D
State whether the following is a/an

Current
Asset
Fixed Asset Current
Liability
Long-term
Liability
Expense Income


1. Land and building Fixed asset 11. Wages or salaries Expense
2. Creditor Current liability 12. Purchases Expense
3. Sales Income 13. Discount received Income
4. Stock Current Asset 14. Discount allowed Expense
5. Rent Payable Expense 15. Cash in hand Current Asset
6. Advertising Expense 16. Cash at bank Current Asset
7. Debtors Current Asset 17. Bank overdraft Current Liability
8. Loan Long-term Liability 18. Premises Fixed Asset
9. Electricity Expense 19. Rent received Income
10. Furniture Fixed Asset 20. Insurance Expense


Exercise E : Accounting period:

Length
of accounting period
Beginning
of accounting period
End
of Accounting period
One month 1 February 2006 ? 28 February 2006
Quarter of a year ? 1 March 2006 31 May 2006
Half a year 1 January 2006 ? 30 June 2006
One year 1 September 2006 ? 31 August 2007





Owners equity = _____$93 500_____
Working:
OE = Assets Liabilities
= (1500+5600+20000+30000+10000+
50000) (6800+1800+15000)
= $93500
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
5
Exercise F: Effects of transactions on the Accounting Equation:


TRANSACTIONS
EFFECTS ON
Assets Liabilities Owners Equity
+ - + - + -
1. Bought goods $2,000
on credit.
$2,000 $2,000
2. Repaid loan $8,000 by
cheque.
$8,000 $8,000
3. Paid insurance $500 by
cheque
$500 $500
4. Received cheques
$250 for commission
$250 $250
5. Bought machinery
$1,000 by cash
$1,000 $1,000
6. Paid creditor $2,000 by
cheque
$2,000 $2,000


Exercise G: Effects of transactions on the Accounting Equation:


TRANSACTIONS
EFFECTS ON
Assets Liabilities Owners Equity
+ - + - + -
1. Started business with
$50,000 cash
$50,000 $50,000
2. Paid cash $40,000 into
the bank
$40,000 $40,000
3. Bought furniture $5,000
on credit
$5,000 $5,000
4. Purchased motor van
for $12,000 paying by
cheque
$12,000 $12,000
5. Paid rent $500 by
cheque
$500

$500
6. Received cash $120
for commission
$120 $120













Exercise H

PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
6
ASSETS LIABILITIES OWNERS
EQUITY
Cash Office
Equipment
Furniture Debtors Creditors Loan Capital
a. +$50,000 +$50,000
b. +$4,000 +$4,000
c. +$2,000 -$2,000
d. -$1,000 -$1,000
e. -$800 -$800
f. +$1,500 +$1,500
g. -$1,800 -$1,800
h. +$1,450 -$1,450
i. -$300 -$300
j. +$10,000 +$10,000











Exercise I: Multiple-Choice Questions

1) B
2) A
3) C
4) C
5) B
6) D
7) C
8) B
9) D
10)D









Example
Topic 4: Ledger and Double-Entry Recording Systems
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
7
Dr Cash Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jun 1 Balance b/d 500 Jun 2 Purchases 250
7 Sales 150 4 Transport 10
10 Ahmad 220 15 Stationery 15
25 Sales 200 20 Purchases 180
28 Wages 80
30 Intel. Co 350
30 Rates 25
30 Balance c/d 160
1,070 1,070
July 1 Balance b/d 160


Exercise:

Dr Cash Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Aug 1 Balance b/d 390 Aug 2 Purchases 550
5 Sales 805 7 Rent 351
15 Sales 658 9 Telephone 158
27 Sales 597 18 Wages 570
25 Purchases 404
28 Water and light 35
31 Balance c/d 382
2,450 2,450
Sep 1 Balance b/d 382



EXERCISE A

a) The owner Danny introduced $30,000 cash into business.

Dr Cash Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Capital 30,000


Dr Capital Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Cash 30,000



b) Bought a second hand van for $18,000 cash.
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
8

Dr Motor Vehicles Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Cash 18,000


Dr Cash Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Motor Vehicles 18,000


c) Paid creditors Ekhwan $3,000 by cheque.

Dr Ekhwan Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Bank 3,000


Dr Bank Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Ekhwan 3,000


d) Bought a computer from Beseller Sdn Bhd $5,000 on credit.

Dr Office Equipment Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Beseller Sdn Bhd 5,000


Dr Beseller Sdn Bhd Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Office Equipment 5,000


e) The owner Saadatul withdrew $1,200 cash for own use.

Dr Drawings Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Cash 1,200



PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
9
Dr Cash Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Drawings 1,200


f) Bought goods $8,000 for cash.

Dr Purchases Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Cash 8,000


Dr Cash Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Purchases 8,000


g) Bought goods from Syakirah $1,500 on credit.

Dr Purchases Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Syakirah 1,500


Dr Syakirah Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Purchases 1,500


h) Returned goods to Syakirah $100.

Dr Syakirah Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Purchases Return 100


Dr Purchases Return Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Syakirah 100




PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
10
i) Sold goods $1,000 to Aqilah on credit.

Dr Aqilah Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Sales 1,000


Dr Sales Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Aqilah 1,000



EXERCISE B
Complete the following table by stating the account to be debited or credited.
TRANSACTIONS ACCOUNT
DEBITED
ACCOUNT
CREDITED
1. Commenced business with cash

Cash Capital
2. The business bought Machinery paid by
cheque
Machinery Bank
3. The business bought furniture from
Franmix Ltd
Furniture Franmix Ltd
4. Received cash from debtor, Zaim

Cash Debtor: Zaim
5. Paid creditor, Rifah, by cheque

Creditor: Rifah Bank
6. The owner brought in cash as additional
capital
Cash Capital
7. The owner brought in his van for business
use
Motor vehicles Capital
8. Sold old office furniture to Zaki

Zaki Furniture
9. Transferred cash from the business to the
bank
Bank Cash
10. Withdrew cash from the bank for office
use
Cash Bank
11. Withdrew cash for personal use

Drawings Cash
12. Bank into the business account a loan
obtained from Baiduri Bank.
Bank Loan

MORE EXERCISES ON DOUBLE ENTRY
DOUBLE ENTRY: EXERCISE 1
Item Transactions A/c Debited A/c Credited
1. Owner brought in additional cash as capital Cash Capital
2. Cash purchases Purchases Cash
3. Paid insurance by cheque Insurance Bank
4. Sold goods on credit to Razali Debtor: Razali Sales
5. Received cash from Lee, the debtor Cash Debtor: Lee
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
11
6. Bought delivery van for business by cheque Motor Vehicles Bank
7. Owner withdrew goods for personal use Drawings Purchases
8. Received cheque as commission Bank Commission

DOUBLE ENTRY: EXERCISE 2
Item Transactions A/c Debited A/c Credited
1. Rina started business with $2,000 cash. Cash Capital
2. Sold goods to customer on credit Debtor Sales
3. Paid rent by cheque Rent Bank
4. Sold motor van to Mira Mira Motor Vehicles
5. Azim paid cash for the amount he owed Cash Debtor: Azim
6. Bought furniture by cash Furniture Cash
7. Liza, the owner took cash for personal use Drawings Cash
8. Received salary by cheque Bank Salaries

DOUBLE ENTRY: EXERCISE 3
Item Transactions A/c Debited A/c Credited
1. Received cheque for capital Bank Capital
2. Cash sales Cash Sales
3. Purchase goods from Wiwi by cheque Purchases Bank
4. Sold equipment to Zaim Zaim Equipment
5. Azim paid cash after sales Cash Sales
6. Bought computer by cash for office use Office Equipment Cash
7. The owner took goods for personal use Drawings Purchases
8. Paid water bill by cheque Water Bills Bank
DOUBLE ENTRY: EXERCISE 4
Item Transactions A/c Debited A/c Credited
1. Paid cash for goods bought Purchases Cash
2. Paid cash for purchase of machinery Machinery Cash
3. Paid electricity by cheque Electricity Bank
4. Bought motor van from Shasha Motor Vehicles Shasha
5. Paid cash for the amount he owed to creditor Creditor Cash
6. Sold goods and received a cheque Bank Sales
7. Sold goods to Aqilah on credit Aqilah Sales
8. Bought goods on credit Purchases Creditor
DOUBLE ENTRY: EXERCISE 5
Item Transactions A/c Debited A/c Credited
1. Mawar brought in additional cash as capital Cash Capital
2. Transfer cash into bank Bank Cash
3. Paid rent by cheque Rent Bank
4. Sold goods on credit to Edward Debtor: Edward Sales
5. Received cash as commission Cash Commission
6. Bought premises for business by cheque Premises Bank
7. Owner withdrew goods for personal use Drawings Purchases
8. Cash purchases Purchases Cash
DOUBLE ENTRY: EXERCISE 6
Item Transactions A/c Debited A/c Credited
1. Richard started business with $3,000 cash. Cash Capital
2. Sold goods to Mizal on credit Debtor: Mizal Sales
3. Paid salary by cheque Salary Bank
4. Sold furniture to Neeza Neeza Furniture
5. Leez paid cash for the amount she owed Cash Debtor: Leez
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
12
6. Bought furniture on credit from Fashion Co Furniture Fashion Co
7. The owner took cash for personal use Drawings Cash
8. Received commission by cheque Bank Commission

DOUBLE ENTRY: EXERCISE 7
Item Transactions A/c Debited A/c Credited
1. Bought computer for office use by cash Office equipment Cash
2. Purchased shop fittings by cheque Shop Fittings Bank
3. Purchase typewriter by cheque Office Equipment Bank
4. Sold office equipment to Ziqah Ziqah Office equipment
5. Returned goods after purchase Creditor Return Outwards
6. Received damaged goods returned by customer Returns Inwards Debtor
7. The owner took goods for personal use Drawings Purchases
8. Paid for stationery bought by cheque Stationery Bank

EXERCISE C

Dr Cash Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 1 Balance b/d 10,000 Jan 3 Purchases 3,245
8 Sales 2,400 4 Rent 800
21 Sales 1,250 24 General Expenses 400
31 Shahmi 200 28 Wages 1,200
31
Commission Received
550 30 Amir & Sons 1,000
31 Insurance 350
31 Balance c/d 7,405
14,400 14,400
Feb 1 Balance b/d 7,405


Dr Shahmi Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 12 Sales 450 Jan 16 Sales Returns 100
31 Cash 200
31 Balance c/d 150
450 450
Feb 1 Balance b/d 150

Dr Amir & Sons Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 19 Purchases Returns 150 Jan 13 Purchases 1,670
30 Cash 1,000
31 Balance c/d 520
1,670 1,670
Feb 1 Balance b/d 520

Dr Sales Account Cr
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
13
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 8 Cash 2,400
12 Shahmi 450
21 Cash 1,250

Dr Purchases Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 3 Cash 3,245
13 Amir & Sons 1,670


Dr Purchases Returns Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 19 Amir & Sons 150


Dr Sales Returns Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 16 Shahmi 100


Dr Rent Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 4 Cash 800


Dr General Expenses Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 24 Cash 400


Dr Wages Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 28 Cash 1,200


Dr Insurance Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 31 Cash 350


PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
14
Dr Commission Received Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 31 Cash 550



EXERCISE D

Dr Cash Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 1 Capital 50,000 Jan 3 Office equipment 5,000
25 Shadri 200 10 NBT Sdn Bhd 10,000
12 High-Tech Ltd 1,200
31 NBT Sdn Bhd 2,000
31 Drawings 300
31 Balance c/d 31,700
50,200 50,200
Feb 1 Balance b/d 31,700



Dr Capital Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 1 Cash 50,000



Dr Drawings Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 31 Cash 300




Dr Shadri Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 15 Office equipment 600 Jan 25 Cash 200
31 Balance c/d 400
600 600
Feb 1 Balance b/d 400





PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
15
Dr Office Equipment Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 3 Cash 5,000 Jan 15 Shadri 600
5 High-Tech Ltd 2,000 31 Balance c/d 8,400
20 High-Tech Ltd 2,000
9,000 9,000
Feb 1 Balance b/d 8,400

Dr Motor Vehicles Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 10 NBT Sdn Bhd 20,000 Jan 31 Balance c/d 20,000

20,000 20,000
Feb 1 Balance b/d 20,000


Dr High-Tech Ltd Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 12 Cash 1,200 Jan 5 Office Equipment 2,000
31 Balance c/d 2,800 20 Office Equipment 2,000
4,000 4,000
Feb 1 Balance b/d 2,800


Dr NBT Sdn Bhd Account Cr
Date Particular Folio Amount
$
Date Particular Folio Amount
$
Jan 31 Cash 10,000 Jan 10 Motor Vehicles 20,000
Cash 2,000
31 Balance c/d 8,000
20,000 20,000
Feb 1 Balance b/d 8,000













EXERCISE E
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
16

TRANSACTION ACCOUNTS
INVOLVED
TYPE OF
ACCOUNTS
EFFECTS
or
LEDGER
ENTRY
Debit
$
Credit
$
1. Bought goods for cash
$3,000
Purchases,
Cash

Expense
Asset


3,000
3,000
2. Received cheques for
cash sales $5,000
Bank,
Sales

Asset
Revenue


5,000
5,000
3. Paid wages by cheques
$2,500
Wages,
Bank

Expense
Asset


2,500
2,500
4. Paid cash for general
expenses $180
General Exp,
Cash

Expense
Asset


180
180
5. Received cheques
$4,500 for commission
Bank,
Commission
Received
Asset
Revenue


4,500
4,500
6. Bought goods for
$2,000 from Izza Co.
on credit
Purchases,
Creditor: Izza
Co.
Expense
Liability


2,000
2,000
7. Returned goods worth
$100 to Izza Co.
because of wrong
specification.
Creditor:
Izza Co.,
Purchases
Return
Liability

Expense



100

100
8. Sold goods for $3,600
to Afiq Brothers on
credit
Debtor: Afiq
Brothers,
Sales
Assets

Revenue



3,600

3,600
9. Afiq Brothers returned
defective goods worth
$400
Sales return,
Debtor: Afiq
Brother
Revenue
Asset


400
400
10. Paid interest on loans
$600 by cheque.
Interest on
loan,
Bank
Expense

Asset



600

600


EXERCISE F: Multiple-choice Questions

1) a
2) c
3) d
4) c
5) b
6) c






PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
17




EXERCISE A:
Trial Balance as at 31 December 2006

Debit
$
Credit
$
Purchases 36,150
Sales 67,000
Debtors 9,700
Creditors 10,700
Motor Vehicles 42,000
Loan 20,000
Fixtures and Fittings 14,000
Returns Inwards 350
Returns Outwards 550
Rent Paid 6,000
Commission Received 800
Carriage Inwards 700
Carriage Outwards 1,850
Insurance 950
Salaries 10,500
Discount Allowed 400
Discount Received 200
Cash in hand 1,200
Cash at bank 3,450
Stock 14,500
Capital 44,000
Drawings 1,500
143,250 143,250

EXERCISE B:

Trial Balance as at 31 December 2006
Debit
$
Credit
$
Capital 19,800
Sales 190,200
Purchases 130,000
Cash in hand 11,500
Bank Overdraft 1,200
Returns Inwards 420
Returns Outwards 300
Carriage Inwards 990
Carriage Outwards 560
Electricity 1,740
Insurance 600
Bank Charges 200
Discount allowed 640
Discount Received 550
Stock (01.01.2006) 6,300
Debtors 14,200
Creditors 15,500
Drawings 10,000
Commission Income 5,100
Salaries 25,000
Motor Vehicles 50,000
Loan from bank (due in 2010) 19,500
252,150 252,150

Topic 5: Trial Balance
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
18
EXERCISE C:
Muiz
Trial Balance as at 31 January 2007
Debit
$
Credit
$
Sales
Purchases
Sales Returns
Purchases Returns
Carriage Outwards
Office Equipment
Premises
Wages
Drawings
Loan from BIBD
Discount Received
Stock (01.01.2007)
Capital

14,000
1,000

880
15,300
17,000
7,000
2,000


3,850
28,500


800





9,400
330

22,000
61,030 61,030

EXERCISE D:
Trial Balance as at 31 January 2005
Debit Credit
$ $
Cash 14,400
Capital 20,000
Purchases 29900
Sales 24,200
Wendy 1,700
Carriage 600
Plaza Co 18,000
Chandran 14,200
Sundry expenses 1,000
Drawings 100
Returns Inwards 300
62,200 62,200

EXERCISE E:
1) c
2) a
3) b
4) c
5) d
6) d

EXERCISE F
1) Trial Balance
2) discount allowed.. discount received
3) overdraft
4) debtorcreditor
5) credit debit
6) opening beginning
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
19



6A: TRADING ACCOUNT

EXERCISE A
Shadri
Trading account for the year ended 31 December 2007
$ $ $ $
Opening Stock (1 Jan) 5,000 Sales 75,200
Purchases 43,000 Less returns inwards (1,200)
Less: returns outwards (3,000) Net Sales 74,000
Net Purchases 40,000
Add: Carriage inwards 1,500
Customs Duty 4,300
Insurance on purchases 1,000 6,800
Cost of goods available for sale 51,800
Less Closing stock (31 Dec) (6,000)
COST OF SALES 45,800
Gross Profit c/d 28,200
74,000 74,000
Gross Profit b/d 28,200


EXERCISE B

Trading account for the year ended 31 December 2007
$ $ $ $
Opening Stock (1 Jan) 10,000 Sales 62,500
Purchases 36,800 Less returns inwards (2,400)
Less: returns outwards (1,800) Net Sales 60,100
Net Purchases 35,000
Add: Carriage inwards 2,350
Customs Duty 3,680
Insurance on purchases 1,150 7,180
Cost of goods available for sale 52,180
Less Closing stock (31 Dec) (13,500)
COST OF SALES 38,680
Gross Profit c/d 21,420
60,100 60,100
Gross Profit b/d 21,420







Topic 6: Final Accounts of Sole-Proprietorships
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
20
EXERCISE C
Trading account for the year ended 31 December 2006
$ $ $ $
Opening Stock (1 Jan) 11,500 Sales 52,500
Purchases 40,950 Less returns inwards (1,800)
Less: returns outwards (1,240) Net Sales 50,700
Net Purchases 39,710 Gross Loss c/d 175
Add: Carriage inwards 1,885
Customs Duty 3,880
Packaging Expenses 4,150 9,915
Cost of goods available for sale 61,125
Less Closing stock (31 Dec) (10,250)
COST OF SALES 50,875

50,875 50,875

Gross Loss b/d 175

6B: PROFIT AND LOSS ACCOUNT
EXERCISE A

NO. ACCOUNT TRADING A/C PROFIT AND LOSS A/C
Debit Credit Debit Credit
1. Advertising
2. Repairs
3. Commission Received
4. Purchases
5. Sales
6. General Expenses
7. Carriage Inwards
8. Carriage Outwards
9. Customs Duty
10. Postage Expenses
11. Stationery
12. Rent Received
13. Discount Received
14. Purchases Returns
15. Sales Returns
16. Interest Expense
17. Insurance on purchases
18. Salesman Commission

PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
21

EXERCISE B

Profit and Loss A/c of Pressage for the year ended 31 December 2006
$ $
Salaries 2,400 Gross Profit b/d 10,400
Rent and Rates 1,200 Commission earned 1,400
Advertising 580
Sundry expenses 1,160
Total Expenses 5,340
Net Profit 6,460
11,800 11,800




EXERCISE 6C

Dr Trading account for the year ended 31 December 2007 Cr
$ $ $ $
Opening Stock (1 Jan) 8,000 Sales 63,800
Purchases 36,700 Less returns inwards (600)
Less: returns outwards (700) Net Sales 63,200
Net Purchases 36,000
Add: Carriage inwards 1,700
Duty on purchases 4,000 5,700
Cost of goods available for sale 49,700
Less Closing stock (31 Dec) (6,600)
COST OF SALES 43,100
Gross Profit c/d 20,100
63,200 63,200



Dr Profit and Loss Account for the year ended 31
st
December 2007 Cr
$ $ $ $
Carriage Outwards 1,500 Gross Profit b/d 20,100
Wages 5,000 Commission Received 3,400
Rent 3,600 Discount Received 200 23,700
Insurance 1,000
Total Expenses 11,100
NET PROFIT 12,600
23,700 23,700






PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
22
EXERCISE D

Trading account for the year ended 30 September 2006
$ $ $ $
Opening Stock (1 Oct) 16,000 Sales 83,800
Purchases 56,700 Less Sales returns (1,250)
Less: Purchases returns (1,400) Net Sales 82,550
Net Purchases 55,300
Add: Carriage inwards 1,450
Duty on purchases 3,800
Packaging expenses 3,200 8,450
Cost of goods available for sale 79,750
Less Closing stock (30 Sept) (14,550)
COST OF SALES 65,200
Gross Profit c/d 17,350
82,550 82,550



Dr Profit and Loss Account for the year ended 30 September 2006 Cr
$ $ $ $
Carriage Outwards 2,460 Gross Profit b/d 17,350
Discount allowed 350 Commission Received 1,400
Rent 4,800 Discount Received 200 18,950
Repairs 1,120
Total Expenses 8,730
NET PROFIT 10,220
18,950 18,950


6C: BALANCE SHEET

EXERCISE A

Balance Sheet of Lily Company as at 31 December 2006
$ $ $ $
Fixed Assets Owner's Equity
Machinery 35,000 Capital 84,329
Premises 50,000
Furniture 15,000 100,000 Long-term Liability
Bank Loan 25,000
Current Assets
Closing stock 22,220 Current Liabilities
Trade Debtors 24,500 Trade Creditors 44,400
Cash at bank 3,600
Cash in hand 3,409 53,729
153,729 153,729


PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
23
EXERCISE B

Haziqah
Trading, Profit and Loss Account for the year ended 31 December 2006
$ $ $ $
Opening Stock 6,700 Sales 58,000
Purchases 31,100 Less: Returns Inwards (700)
Less: Returns Outwards (400) Net Sales 57,300
30,700
Add: Carriage inwards 600
Net Purchases 31,300
Cost of goods available for sale 38,000
Less Closing stock (8,000)
Cost of Sales 30,000
Gross Profit c/d 27,300
57,300 57,300

Carriage Outwards 1,040 Gross Profit b/d 27,300
Rent 2,000 Commission Received 2,000
Wages and Salaries 4,000
Stationery 260 7,300
Net Profit 22,000
29,300 29,300


Balance Sheet of Haziqah as at 31 December 2006
$ $ $ $
Fixed Assets Owner's Equity
Motor Vehicles 12,000 Capital 1.1.2006 20,000
Furniture 10,000 22,000 Add: Net Profit 22,000
42,000
Current Assets Less: Drawings (3,000)
Bank 9,500 Capital 31.12.2006 39,000
Closing stock 8,000
Debtors 15,000 32,500 Long-term Liability
Loan from BIBD 10,000

Current Liabilities
Creditors 5,500
54,500 54,500









PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
24
EXERCISE C

Hadzrizul
Trading, Profit and Loss Account for the year ended 31 December 2006
$ $ $ $
Opening Stock 21,100 Sales 86,650
Purchases 51,900
Less: Purchases Returns (530)
51,370
Add: Carriage inwards 1,600
Custom Duties 2,300
Net Purchases 55,270
Cost of goods available for sale 76,370
Less Closing stock (22,500)
Cost of Sales 53,870
Gross Profit c/d 32,780
86,650 86,650

Carriage Outwards 450 Gross Profit b/d 32,780
General Expenses 2,800 Discount Received 270
Wages and Salaries 8,000
Insurance 950
Interest 1,500
Discount allowed 300 14,000
Net Profit 19,050
33,050 33,050


Balance Sheet of Hadzrizul as at 31 December 2006
$ $ $ $
Fixed Assets Owner's Equity
Premises 80,000 Capital 1.1.2006 78,000
Furniture and Fittings 9,000 89,000 Add: Net Profit 19,050
97,050
Current Assets Less: Drawings (5,000)
Closing stock 22,500 Capital 31.12.2006 92,050
Debtors 3,900 26,400
Long-term Liability
Mortgage on premises 15,000

Current Liabilities
Creditors 5,150
Bank Overdraft 3,200 8,350
115,400 115,400





PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
25
EXERCISE D
Eliza
Trading, Profit and Loss Account for the year ended 31 December 2007
$ $ $ $
Opening Stock 12,000 Sales 78,500
Purchases 40,300 Less: Returns Inwards (200)
Less: Purchases Returns (300) Net Sales 78,300
40,000
Add: Carriage inwards 1,750
Custom Duties 650
Net Purchases 42,400
Cost of goods available for sale 54,400
Less Closing stock (10,000)
Cost of Sales 44,400
Gross Profit c/d 33,900
78,300 78,300

Carriage Outwards 1,250 Gross Profit b/d 33,900
Wages 10,160 Rent Revenue 3,000
Insurance 1,750 Commission Revenue 2,540
Sales Commission 2,640
Interest 2,000 17,800
Net Profit 21,640
39,440 33,440


Balance Sheet of Eliza as at 31 December 2007
$ $ $ $
Fixed Assets Owner's Equity
Premises 45,000 Capital 1.1.2007 40,000
Motor Vehicles 25,000 Add: Net Profit 21,640
Fixtures and Fittings 5,000 75,000 61,640
Less: Drawings 700
Current Assets Capital 31.12.2007 60,940
Closing stock 10,000
Debtors 6,400 Long-term Liability
Cash 840 17,240 Mortgage on premises 20,000

Current Liabilities
Creditors 7,000
Bank Overdraft 4,300 11,300
92,240 92,240

EXERCISE E : MULTIPLE CHOICE QUESTIONS
1) b
2) d
3) c
4) b
5) c
6) d
7) c
8) a
9) d
10) b
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
26





EXERCISE A

No. TRANSACTION DOCUMENTS
(a) The owner brought in furniture for office use Memo
(b) Received from the supplier a summary of transactions that
had taken place for the month.
Statement of account
(c) Cash purchases Cash bill / Receipts
(d) Cash sales Cash Register slip issued
(e) Returned goods to supplier Credit note received
(f) Cash deposited in current account Bank deposit slip
(g) Settlement of account Receipt / cheque butt
(h) Notified by Ah Peng Service Centre for amount owing for repairs Invoice received
(i) Notified debtor for overcharges Credit note issued
(j) Notified debtor for undercharges Debit Note Issued

EXERCISE B

No. TRANSACTION BOOK OF PRIME ENTRY
(a) Goods withdrawn for the purpose of giving as free
samples in the promotion campaign.
General Journal
(b) An office equipment dealer bought photocopy machines
on credit.
Purchases Journal
(c) An office equipment dealer took a photocopier for his
office use.
General Journal
(d) Charged interest by creditor on overdue amount. General Journal
(e) Received an invoice from Good Service for servicing
office air-conditioners.
General Journal
(f) A furniture dealer sold settee on credit Sales Journal
(g) Received a debit note from the supplier Purchases Journal
(h) Goods of wrong specification returned to the supplier Purchases Returns Journal

EXERCISE C

1. c
2. d
3. b
4. c
5. b
6. c
7. a
8. d
9. c
10. a





Topic 7: Source Documents and Books of Prime Entry
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
27




PURCHASES JOURNAL
EXERCISE A
Purchases Journal
Date Particular Invoice No. Invoice
Details
$
Total
$
2007
Jan 2 Ronald Enterprise AO 198 780
Less: Trade Discount 10% (78) 702

17 Western Co. 9087 960
Less: Trade Discount 15% (144) 816

25 Nathan Suppliers D213 750
Less: Trade Discount 20% (150) 600

30 Orico Company P2476 400
Less: Trade Discount 20% (80) 320

31 Purchases Account (Dr) 2,438


General Ledger
Purchases A/c
2007 $
Jan 31 Sundry Creditors 2,438

Purchases Ledger
Ronald Enterprise A/c
2007 $
Jan 2 Purchases 702

Western Co. A/c
2007 $
Jan 17 Purchases 816


Nathan Suppliers A/c
2007 $
Jan 25 Purchases 600


Orico Company A/c
2007 $
Jan 30 Purchases 320


EXERCISES: JOURNALS

PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
28
EXERCISE B
Purchases Journal
Date Particular Invoice
No.
Invoice
Details
$
Total
$
2007
Feb 1 Feezah 510

3 Amalina 400
Less: Trade Discount 15% (60) 340

8 Feezah 1,000
Less: Trade Discount 12% (120) 880

9 Alim 375

28 Purchases Account (Dr) 2,105

EXERCISE C
Purchases Journal
Date Particular Invoice
No.
Invoice
Details
$
Total
$
2007
Jan 5 Dash Co. Ltd. 300

7 Yati Company 400
Less: Trade Discount 20% (80) 320

16 Dash Co. Ltd. 200
Less: Trade Discount 5% (10) 190

20 Yati Company 250

31 Purchases Account (Dr) 1,060

SALES JOURNAL
EXERCISE A
Sales Journal
Date Particular Invoice No. Invoice Details
$
Total
$
2007
Mar 3 Stanley Co. B1504 6,800
Less: Trade Discount 40% (2,720) 4,080

19 Julie Robbins B1505 7,200
Less: Trade Discount 30% (2,160) 5,040

26 Yataro Store B1506 5,100
Less: Trade Discount 35% (1,785) 3,315

31 Sales Account (Cr) 12,435

PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
29

General Ledger
Sales A/c
2007 $
Jan 31 Sundry Debtors 12,435


Sales Ledger
Stanley Co. A/c
2007 $
Mar 3 Sales 4,080


Julie Robbins A/c
2007 $
Mar 19 Sales 5,040


Yataro Store A/c
2007 $
Mar 26 3,315


EXERCISE B
Sales Journal
Date Particular Invoice No. Invoice Details
$
Total
$
Mar 1 Dina 500

4 Chacha 520
Less: Trade Discount 5% (26) 494

7 Liana 480

9 Hasyimah 2,000
Less: Trade Discount 15% 300 1,700

31 Sales Account (Cr) 3,174

EXERCISE C
Sales Journal
Date Particular Invoice No. Invoice Details
$
Total
$
Mar 1 Lizzie (10 x $30) 300
Less: Trade Discount 10% 30 270

9 Erra Corner (2 X $36) 72
Less: Trade Discount 5% (3.60) 68.40

19 Haizan (5 X $3) 15

28 Erra Corner (44 X $2) 88

31 Sales Account (Cr) 441.40


PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
30
RETURNS OUTWARDS JOURNAL

EXERCISE A
Returns Outwards Journal
Date Particular Credit Note
No.
Credit Note
Details
$
Total
$
2007
Aug 15 Western Suppliers 27 400
Less: Trade Discount 25% (100) 300

24 Boston Co. 112 540
Less: Trade Discount 20% (108) 432

30 Gadget Shop 78 350
Less: Trade Discount 30% (105) 245

31 Returns Outwards Account (Cr) 977

General Ledger
Returns Outwards A/c
2007 $
Jan 31 Sundry Creditors 977


Purchases Ledger
Western Suppliers A/c
2007 $
Aug 15 Returns Outwards 300

Boston Co. A/c
2007 $
Aug 24 Returns Outwards 432


Gadget Shop A/c
2007 $
Aug 30 Returns Outwards 245


EXERCISE B
Returns Outwards Journal
Date Particular Credit Note
No.
Credit Note
Details
$
Total
$

Jan 1 Syarikat Hadi 80

3 Syarikat Budiman 75

7 Syarikat Mawar Bhd 95
Less: Trade Discount 15% 14.25 80.75

9 Hassanal 45

31 Returns Outwards Account (Cr) 280.75
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
31

EXERCISE C
Purchases Journal
Date Particular Invoice No. Invoice Details
$
Total
$

Feb 4 Musfirah Company 600
Less: Trade Discount 15% (90) 510

7 Hanani Pte Ltd. 4,000
Less: Trade Discount 20% (800) 3,200

28 Purchases Account (Dr) 3,710


Returns Outwards Journal
Date Particular Credit Note
No.
Credit Note
Details
$
Total
$

Feb 7 Musfirah Company 80
Less: Trade Discount 15% (12) 68

8 Hanani Pte Ltd. 200
Less: Trade Discount 20% (40) 160

31 Returns Outwards Account (Cr) 228


RETURNS INWARDS JOURNAL

EXERCISE A
Returns Inwards Journal
Date Particular Credit Note
No.
Credit Note
Details
$
Total
$
2007
Mar 12 Super Trio 158 800
Less: Trade Discount 40% (320) 480

25 Green Inc 159 500
Less: Trade Discount 30% (150) 350

31 Kedai Besar 160 700
Less: Trade Discount 35% (245) 455

31 Returns Inwards Account (Dr) 1,285

General Ledger
Returns Inwards A/c
2007 $
Mar 31 Sundry Debtors 1,285

PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
32

Sales Ledger
Super Trio A/c
2007 $
Mar 12 Returns Inwards 480

Green Inc A/c
2007 $
Mar 25 Returns Inwards 350


Kedai Besar A/c
2007 $
Mar 31 Returns Inwards 455


EXERCISE B

EXERCISE C
Sales Journal
Date Particular Invoice No. Invoice
Details
$
Total
$
Aug 3 Azim 2,200
Less: Trade Discount 10% (220) 1,980

15 Azim 330

31 Sales Account (Cr) 2,310
Returns Inwards Journal
Date Particular Credit Note
No.
Credit Note
Details
$
Total
$

Aug 5 Azim (2 X $50) 100
Less: Trade Discount 10% (10) 90

31 Returns Inwards Account (Dr) 90

Returns Inwards Journal
Date Particular Credit Note
No.
Credit Note
Details
$
Total
$
Jan 1 Dede 25

3 Ain 85

7 Syarikat Rasyidah (8 X $3) 24

9 Azrin 55
Less: Trade Discount 5% 2.75 52.25

31 Returns Inwards Account (Dr) 186.25
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
33
GENERAL JOURNALS
EXERCISE A
General Journal
Date Particulars Debit Credit
$ $
2007
July 1 Premises 80,000
Delivery Van 18,000
Office Equipment 5,000
Stock 50,000
Debtors: Saad 4,400
Wafiy 3,200
Cash 2,345
Mortgage on premises 30,000
Creditors: Redza 6,500
Muhiy 2,800
Bank 5,645
Capital 118,000
(being assets, liabilities and capital at this date) 162,945 162,945
EXERCISE B
General Journal
Date Particulars Debit Credit
$ $
Premises 20,000
Fixtures 4,000
Stock 520
Cash 200
Debtors: Alvis 360
Levis 356
Bank Overdraft 2,000
Creditors: John 234
Johny 60
Capital 23,142
(being assets, liabilities and capital at this date) 25,436 25,436
Premises A/c Fixtures A/c
$ $
Balance b/d 20,000 Balance b/d 4,000


Stock A/c Cash A/c
$ $
Balance b/d 520 Balance b/d 200



Debtor: Alvis A/c Debtor: Levis A/c
$ $
Balance b/d 360 Balance b/d 356


PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
34
Bank A/c Creditor: John A/c
$ $
Balance b/d 2,000 Balance b/d 234


Creditor: Johny A/c Capital A/c
$ $
Balance b/d 60 Balance b/d 23,142


EXERCISE C
General Journal
Date Particulars Debit Credit
$ $
Jan 1 Office Equipment 500
Bank 500

3 Office Equipment 600
Syarikat Baiduri Bhd 600

5 Bank 3,000
Motor Vehicles 3,000

6 Motor Vehicles 7,500
Bank 7,500

15 Salwa 160
Furniture 160


EXERCISE D
General Journal
Date Particulars Debit Credit
$ $
(a) Drawings 50
Office Equipment 50
(Being calculator taken by owner for own use)

(b) Office Equipment 7,000
Beseller Ltd 7,000
(Being purchase of two units of computer on credit)

(c) Beseller Ltd 3,500
Office Equipment 3,500
(Being return of one unit of computer)

(d) Motor Vehicles 1,000
Shahmi 1,000
(Being motorbike accepted as full payment of debt)
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
35
(e) Delivery expense 550
NBT Transport Ltd 550
(Being delivery expense incurred)

(f) Stationery Expense 100
Purchases 100
(Being stationery taken for office use)

EXERCISE E
General Journal
Date Particulars Debit Credit
$ $
(a) Motor Vehicles 25,000
Capital 25,000
(Being private car brought in for business use)

(b) Drawings 5,000
Bank 5,000
(Being cash withdrawn for personal use)

(c) Drawings 200
Purchases 200
(Being goods withdrawn for personal use)

(d) Wages 500
Bank 500
(Being payment of wages by cheque)

(e) Yana 1,250
Bank 1,200
Discount Received 50
(Being payment of debt of $1250)



















PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
36





Practice 1 Two Column Cash Book

Date Particular Cash Bank Date Particular Cash Bank
2006 $ $ 2006 $ $
Aug' 1 Balance b/d 500 3,411 Aug'4 W.Yong 485
6 Sales 200 8 Salaries 412
10 P.Allen 600 14 P.Allen (dishonoured) 600
29 T.Rahim 840 16 Bank charges 25
30 Sales 800 18 Tan Brothers 480
31 Cash 900 20 Rent 450
23 Electricity 122
25 Tan Traders 360
31 Bank 900
31 Balance c/d 400 3,017
1,300 5,951 1,300 5,951
Sept'1 Balance b/d 400 3017
Two column Cash Book

Practice 2 Three Column Cash Book

Three Column Cash Book
Date Particular Discount Cash Bank Date Particular Discount Cash Bank
2008 2008
Jan 1 Bal b/d 2,000 4,000 Jan 3 Purchases 1,700
6 Sales 1,150 4 Stationery 180
20 Loan 3,000 9 Kayra Sis. 20 380
24 Zahra Ent 650 1,000 11 Drawings 700
28 Hali 100 1,900 13 Purchases 900
17 Advertising 90
23 Rent 1,800
25 Transport 1,100
30 Bal c/d 2,630 4,220
100 3,800 9,900 20 3,800 9,900
Feb 1 Bal b/d 2,630 4,220

Topic 9 : Cash Book
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
37


Discount Allowed
2008 $ $
Jan 31 Total 100


Discount Received
2008 $
Jan 31 Total 20


Exercise A.
Cash Book
2008 Cash Bank 2008 Cash Bank
Mar $ $ Mar $ $
1 Balance b/d 238 3,166 3 Ah Lee 1,253
6 Sales 275 8 Wages 64
13 Mali 873 11 Electricity 89
20 Sales 497 19 Purchases 2,356
26 Cash c 450 22 Wages 74
26 Bank c 450
27 Motor expenses 39
Drawings 250
31 Balance c/d 383 541
1,010 4,489 1,010 4,489
April 1 Balance b/d 383 541

Exercise B.
Cash Book
2008 Cash Bank 2008 Cash Bank
April $ $ April $ $
1 Balance b/d 550 2,550 4 Rent 350
10 Sales 135 7 Tansport 55
13 Adlina 800 9 Purchases 170
18 Bank c 350 16 Drawings 250
30 Cash c 250 18 Cash c 350
22 Sundry expenses 130
23 Ameera Supplier 1,250
30 Bank c 250
Balance c/d 430 1,400
1,035 3,600 1,035 3,600
May1 Balance b/d 430 1,400








PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
38


Exercise C
Cash Book
2008 Cash Bank 2008 Cash Bank
Sept $ $ Sept $ $
1 Balance b/d 160 560 3 Cash c 190
3 Bank c 190 7 Purchases 210
13 Wazeef Wazeen 1,140 10 Transport 85
16 Sales 138 13 Office Furniture 180
19 Ahmad 200 26 Bank charges 70
30 Bank c 110 29 Uzma 150
30 Ratino 170
Cash c 110
Balance c/d 303 1,030
598 1,900 598 1,900
Oct1 Balance b/d 303 1,030

Exercise D
Cash Book
2008 Dis Cash Bank 2008 Dis Cash Bank
Jan $ $ $ Jan $ $
1 Balance b/d 2,000 4,000 3 Purchases 1,700
6 Sales 1,150 4 Stationery 180
20 Loan 9,000 9 Harita Sisters 20 380
24 Saidatul Ent 650 1,000 11 Drawings 700
28 Frank 100 1,900 13 Purchases 900
17 Advertising 90
23 Rent 1,800
25 Transport exp 1,100
31 Balance c/d 2,630 10,220
100 3,800 15,900 20 3,800 15,900


Discount Allowed
2008 $ $
Jan 31 Total 100


Discount Received
2008 $
Jan 31 Total 20









PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
39





Exercise A.

Bank Cash Book
2008 $ 2008 $
Jan Jan
31 Balance b/d 7,522 31 Insurance 240
Bank charges 86
Kyra (Dishonoured) 132
Balance c/d 7,064
7,522 7,522

Bank Rconciliation Statement as at 31 January 2008
$
Balance as per cash book 7,064
Add : unpresented cheque 364
7,428
Less: Unpresented cheque 147
Balance as per bank statement 7,281

Exercise B.

Bank Cash Book
2008 $ 2008 $
Nov Nov
30 Balance b/d 1,677 31 Insurance 500
Din Din 1,350 Bank charges 12

Balance c/d 2,515
3,027 3,027


Bank Rconciliation Statement as at 30 November 2008

$
$
Balance as per cash book

2,515
Add : unpresented cheque : Cosmos Comapny
2,422

: Jarud din
1,970
4,392


6,097
Less: Unpresented cheque 981
Balance as per bank statement 5,926





Topic 10 :Bank Reconciliation
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
40
Exercise C.

Bank Cash Book
2008 $ 2008 $
April April
30 AB Abadi 8,186 30 Balance b/d 3,680
Bank charges 241
Insurance 1,605
Balance c/d 2,660
8,186 8,186


Bank Rconciliation Statement as at 30 April 2008

$
$
Balance as per cash book

2,660
Add : unpresented cheque : 10901
3,000

: 10923
3,145
6,145


8,805
Less: Unpresented cheque: 37602 1,000
: 64786 1,111
: 98705 1,823 3,934
Balance as per bank statement 4,871

Exercise D.

Bank Cash Book
2008 $ 2008 $
Mar Mar
30 Balance b/d 3,814 30 Bank charges 20
Fixed deposit 50 Insurance 285
Batrisya 750
Balance c/d 4,309
4,614 4,614


Bank Rconciliation Statement as at 30 April 2008

$
$
Balance as per cash book

4,309
Add : unpresented cheque : 883
282

: 887
324
606


4,915
Less: Unpresented cheque: Ann 410
Balance as per bank statement 4,505





PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
41
Exercise E.

Cash Book (Bank Column)
2010 $ 2010 $
Aug 31 Balance b/d 790 Aug 31 Dishonoured Cheque
Dividend 25 Ah Ping 260
Bank Charges 20
Balance c/d 535
815 815


Bank Rconciliation Statement as at 31 August 2010

$
$
Balance as per cash book

535
Add : unpresented cheque

220


755
Less: Unpresented cheque 200
Balance as per bank statement 555






Petty Cash Book
Receipts Date Details Total Office Exp Transport Stationery Others
2002 $ $ $ $

$
20 1-Jul Bal b/d

80 Cash

2 Donation 6
6
3 Office tea 10 10

4 Taxi fares 14 14

5 Paper 12 12

6 Repairs 5 5

Bus fare 4 4

7 Loan 40
40
91 15 18 12

46
31 Bal c/d 9

100 100

9 1-Aug Bal b/d

91 Cash

Topic 11 : Petty Cash Book
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
42

Practice 1
Receipts Date Details Total Transport Cleaning Postage Office Expenses
$ 2006 $ $ $ $ $
23 1-Mar Balance b/d
177 1 Cash
4 Stamps 6 6
5 Taxi fare 68 68
7 Office Cleaning 30 30
10 Milo 13 13
15 Taxi fare 19 19
20 Parcel post 18 18
27 Newspaper 23 23
177 87 30 24 36
Balance c/d 23
200 200
23 1-Apr Balance b/d
177 Cash
Petty Cash Book

Exercise A.
Petty Cash Book
Receipts Date Particular Total Wages Postage Stationery Sundry
$ 2008 $ $ $ $ $
April
47 1 Balance b/d
453 Bank
2 Wages 88 88
4 Postage stamps 30 30
8 Wages 91 91
13 Envelopes 23 23
17 Wages 88 88
23 Gift vouchers 42 42
26 Stationery 28 28
30 Wages 85 85
475 352 30 51 42
Balance c/d 25
500 500
500 May 1 Balance b/d
25 Bank





PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
43
Exercise B
Petty Cash Book
Receipts Date Particular Total Wages Postage Stationery Travelling
$ 2008 $ $ $ $ $
July
86 1 Balance b/d
214 Bank
6 Wages 32 32
7 Postage stamps 25 25
9 Parcel post 4 4
10 Wages 18 18
Fax Paper 42 42
11 Taxi Fare 12 12
12 Envelopes 8 8
13 Transport claims 5 5
14 Registered mail 13 13
17 Wages 21 21
23 Carbon paper 15 15
24 Voucher books 9 9
Taxi fare 15 15
26 Wages 31 31
27 Transport claims 21 21
29 Fax paper 11 11

282 102 42 85 53
Balance c/d 18
300 300
18 Aug 1 Balance b/d
300 Bank

Exercise C.
Petty Cash Book
Receipts Date No. Particular Total Postage Travel Stationery Office Ex.
$ 2008 $ $ $ $ $
Aug
400 1 Bank
1 25 Postage 6 6
9 26 Typing paper 40 40
13 27 Taxi fare 13 13
13 28 Office Clean 50 50
17 29 Stamps 9 9
19 30 Train tickets 21 21
21 31 Envelopes 5 5
21 32 Taxi fares 24 24
26 33 Office Clean 50 50
26 34 Office repairs 70 70
28 35 Stamp pads 12 12
300 15 58 57 170
Balance c/d 100
400 400
100 Sept 1 Balance b/d
300 Bank



PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
44





Exercise A.

a) Straight line method b) Reducing Balance Method

Year 1 - $54,000 x 20% = $10,800 Year 1 $54,000
20% - $10,800
Year 2 - $54,000 x 20% = $10,800 Year 2 $ 43,200
20% - $ 8,640
Year 3 - $54,000 x 20% = $10,800 Year 3 $34,560
20% $ 6,912
$27,648


Exercise B
-Straight Line Method
Motor Van Account
2006 $ 2006 $
Jan 1 Bank 68,000 Dec 31 Depreciation 13,600
Balance c/d 54,400
68,000 68,000

2007 2007
Jan 1 Balance b/d 54,400 Dec31 Depreciation 13,600
Balance c/d 40,800
54,400 54,400

2008 2008
Jan 1 Balance b/d 40,800 Dec 31 Depreciation 13,600
Balance c/d 27,200
40,800 40,800

2009
Jan 1 Balance b/d 27,200

Depreciation Account
2006 $ 2006 $
Dec 31 Motor Van 13,600 Dec 31 Profit and Loss 13,600
2007 2007
Dec 31 Motor Van 13,600 Dec 31 Profit and Loss 13,600
2008 2008
Dec 31 Motor Van 13,600 Dec 31 Profit and Loss 13,600





Topic 12 : Accounting of Fixed Assets
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
45
Reducing Balance Method
Motor Van Account
2006 $ 2006 $
Jan 1 Bank 68,000 Dec 31 Depreciation 13,600
Balance c/d 54,400
68,000 68,000

2007 2007
Jan 1 Balance b/d 54,400 Dec31 Depreciation 10,880
Balance c/d 43,520
54,400 54,400

2008 2008
Jan 1 Balance b/d 43,520 Dec 31 Depreciation 8,704
Balance c/d 34,816
43,520 43,520
2009
Jan 1 Balance b/d 34,816

Depreciation Account
2006 $ 2006 $
Dec 31 Motor Van 13,600 Dec 31 Profit and Loss 13,600

2007 2007
Dec 31 Motor Van 10,880 Dec 31 Profit and Loss 10,880

2008 2008
Dec 31 Motor Van 8,704 Dec 31 Profit and Loss 8,704

Exercise C
Machinery Account
2006 $ 2006 $
July 1 Bank 56,000 Dec 31 Depreciation 3,250
Balance c/d 52,750
56,000 56,000

2007 2007
Jan 1 Balance b/d 52,750 Dec31 Depreciation 6,500
Balance c/d 46,250
52,750 52,750

2008 2008
Jan 1 Balance b/d 46,250 Dec 31 Depreciation 6,500
Balance c/d 39,750
46,250 46,250

2009
Jan 1 Balance b/d 39,750


PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
46
Depreciation Account
2006 $ 2006 $
Dec 31 Machinery 3,250 Dec 31 Profit and Loss 3,250

2007 2007
Dec 31 Machinery 6,500 Dec 31 Profit and Loss 6,500

2008 2008 $
Dec 31 Machinery 6,500 Dec 31 Profit and Loss 6,500

Exercise D

Motor Lorry Account
2006 $ 2006 $
Jan 1 Bank 120,000 Dec 31 Balance c/d 120,000

2007 2007
Jan 1 Balance b/d 120,000 Dec 31 Balance c/d 120,000

2008
Jan 1 Balance b/d 120,000

Provision for Depreciation
2006 $ 2006 $
Dec 31 Balance c/d 24,000 Dec 31 Depreciation 24,000

2007 2007
Dec 31 Balance c/d 43,200 Jan 1 Balance b/d 24,000
Dec 31 Depreciation 19,200
43,200 43,200
2008
Jan 1 Balance b/d 43,200

Depreciation Account
2006 $ 2006 $
Dec 31 Provision for Depreciation 24,000 Dec 31 Profit and Loss 24,000

2007 2007
Dec 31 Provision for Depreciation 19,200 Dec 31 Profit and Loss 19,200

Exercise E

Depreciation = Cost - Scrap Value = $ 24000 - $6000 = $3600 pa.
No. of years 5 yrs

Motor Van Account
2008 $ 2008 $
July 1 Balance b/d 24,000 Dec 31 Disposal 24,000


PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
47
Provision for Depreciation Account
2008 $ 2008 $
Dec 31 Disposal 9,000 Jan 1 Balance b/d 5,400
Dec 31 Depreciation 3,600
9,000 9,000


Disposal of Motor Van Account
2008 $ 2006 $
Dec 31 Motor Van 24,000 Dec 31 Provision for Depreciation 9,000
Bank 14,000
Loss on Disposal 1,000
24,000 24,000







Exercise A
General Journal
2008 DR CR
$ $
June 30 Bad Debts 120
Lily 120
Being bad debts written off

Bad Debts Account
2008 $ $
June 30 Lily 120


Lilys Account
2008 $ 2008 $
Jan 1 Balance b/d 120 Jun 30 Bad Debts 120


Exercise B

Tashims Account
2008 $ 2008 $
Jan 1 Balance b/d 3,600 July 23 Bank 720
Sept 19 Bank 540
Bad Debts 2,340
3,600 3,600


Topic 13 : Bad Debts and Provision of Doubtful Debts
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
48
Exercise C
Cash Account
2008 $
July 7 Bad Debts recovered 250


Bad Debts Recovered Account
2008 $
July 7 Cash 250


Exercise D
General Journal
2008 DR CR
$ $
Dec 31 Profit and Loss 170
Provision for Bad Debts 170
Being creation of provision for bad debts.

Provision for Bad Debts Account
2008 $
Dec 31 Profit and Loss Account 170


Profit and Loss Accounts for the year ended 31 December 2008

Provision for bad debts
$
170


Balance sheet as at 31 December 2008
Current Assets $ $
Debtors 8,500
Less: provision for Bad
Debt
170
8,330
















PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
49





EXERCISE A: Adjustments for Expense

Rent Paid Account
2009 $ 2009 $
Dec 31 Bank 9,630 Dec 31 Profit and Loss 10,480
Balance c/d 850
10,480 10,480
2010
Jan 1 Balance c/d 850

Profit and Loss Account for the year ended 31 December 2009
$
Rent 10,480


Balance Sheet as at 31 December 2009
$
Current Liabilities
Accured Expenses 850



EXERCISE B: Adjustments for Expense

Salaries Account
2008 $ 2008 $
Dec 31 Bank 13,320 Jan 1 Balance b/d 2,430
Balance c/d 800 Dec 31 Profit and Loss 11,690
14,120 14,120
2008
Jan 1 Balance b/d 800

Profit and Loss Account for the year ended 31 December 2009
$
Salaries 11,690


Balance Sheet as at 31 December 2009
$
Current Liabilities
Accured Expenses 800





Topic 14 : Balance Day Adjustment
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
50
Rent Account
2009 $ 2009 $
Jun 30 Bank 360 Jun 30 Profit and Loss 480
Balance c/d 120
480 480
July 1 Balance b/d 120


EXERCISE C: Adjustments for Expense

Sundry Expenses Account
2009 $ 2009 $
Dec 30 Bank 360 Jan 1 Balance b/d 50
Balance c/d 30 Dec 31 Profit and Loss 340
390 390
2010
Jan1 Balance b/d 30

Wages Account
2009 $ 2009 $
Dec 30 Bank 9750 Jan 1 Balance b/d 350
Balance c/d 370 Dec 31 Profit and Loss 9770
10120 10120
2010
Jan 1 Balance b/d 370

EXERCISE D: Adjustments for Expense

Insurance Account
2009 $ 2009 $
Dec 31 Bank 250 Dec 31 Profit and Loss 150
Balance c/d 100
250 250
2010
Jan 1 Balance b/d 100

Insurance Account
2008 $ 2008 $
Jan 1 Balance b./d 40 Dec 31 Profit and Loss 235
Dec 31 Bank 240 Balance c/d 45
280 280
2009
Jan 1 Balance b/d 45







PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
51
EXERCISE E: Adjustments for Expense
a)
Rates Account
2009 $ 2009 $
Jan 1 Balance b/d 126 Dec 31 Profit and Loss 522
May 31 Bank 264 Balance c/d 132
Nov 1 Bank 264
654 654
2010
Jan 1 Balance b/d 132

b)
Rates Account
2009 $ 2009 $
Jan 1 Balance b/d 90 Dec 31 Profit and Loss 390
Dec 31 Bank 200
Balance c/d 100
390 390
2010
Jan 1 Balance b/d 100



EXERCISE F: Adjustments for Revenue

a)
Rent Receivable Account
2009 $ 2009 $
Jan 1 Balance b/d 200 Dec 31 Bank 3,100
Dec 31 Profit and Loss 3,000 Balance c/d 100
3,200 3,200
Balance b/d 100


Profit and Loss Account for the year ended 31 December 2009
$
Rent Receivable 3,000


Balance Sheet as at 31 December 2009
$
Current Assets
Accured rent receivable 100








PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
52
EXERCISE G: Adjustments for Revenue

a)

5
/
12
X $6000 = $2500

Rent Receivable Account
2009 $ 2009 $
Sept 30 Profit and Loss 2,500 May 1 Bank 1,500
Balance c/d 500 Aug 1 Bank 1,500
3,000 3,000
Oct 1 Balance b/d 500


b)
Commission Receivable Account
2009 $
Dec 31 Bank 320


c)
Commission Receivable Account
2009 $ 2009 $
Dec 31 Profit and Loss 380 Dec 31 Bank 320
Balance c/d 60
380 380
2010
Jan 1 Balance b/d 60

EXERCISE H: Adjustments for Revenue

a)
Rent Receivable Account
2009 $ 2009 $
Dec 31 Profit and Loss 7,200 Mar 31 Bank 1,800
Jun 30 Bank 1,800
Sep 30 Bank 1,800
Dec 31 Balance c/d 1,800
7,200 7,200
2010
Jan 1 Balance b/d 1,800

b)
Rent Receivable Account
2009 $ 2009 $
Dec 31 Profit and Loss 3,000 Jan 1 Balance b/d 200
Balance c/d 300 Dec 31 Bank 3,100
3,300 3,300
2010
Jan 1 Balance b/d 300


PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
53
EXERCISE I: Adjustments for Revenue

a)
5
/
12
X $6000 = $2500

Rent Receivable Account
2009 $ 2009 $
Sept 30 Profit and Loss 2,500 May 1 Bank 1,200
Aug 1 Bank 1,200
Sept 30 Balance c/d 100
2,500 2,500
Oct 1 Balance b/d 100

b)
Rent Receivable Account
2009 $ 2009 $
Dec 31 Profit and Loss 7,200 Mar 31 Bank 3,000
Balance c/d 1,800 Jun 30 Bank 3,000
Sept 30 Bank 3,000
9,000 9,000
2010
Jan 1 Balance b/d 1,800





























PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
54
EXERCISE A



Trading, Profit and Loss Account for the year ended 31 December 2006
$ $ $ $
Opening Stock 15,985 Sales 72,560
Purchases 43,455 Less: Sales Returns (680) 71,880
Add: Carriage inwards 2,345 45,800
Cost of goods available for sale 61,785
Less Closing stock (16,800)
Cost of Sales 44,985
Gross Profit c/d 26,895
71,880 71,880

Salaries 6,000 Gross Profit b/d 26,895
Rent 3,200 Commission Received 1,885
Discount Allowed 115
Depreciation on Motor Vehicles 5,040
Bad debts 150
Provision for bad debts 50
Advertising 7,000 21,555
Net Profit 7,225
28,780 28,780

Hussien
Balance Sheet as at 31 December 2006

Fixed Assets Owner's Equity
Motor Vehicles 28,000 Capital on 1 Jan 35,000
Less: Provision for
Depreciation
(15,120)
12,880 Add: Net Profit 7,225
Office Equipment 5,000 17,880 42,225
Less: Drawings (1,800)
Current Assets Capital on 31 Dec 40,425
Closing stock 16,800
Debtors 3,500 Current Liabilities
Less: Provision for bad debts (180) 3,320 Creditors 3,990
Bank 6,765 Accrued Advertising 1,000 4,990
Prepaid Rent 400
Accrued Commission 250 27,535
45,415 45,415

Topic 15 : Final Account with Adjustments
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
55
EXERCISE B
Farah Adeebah
Trading, Profit and Loss Account for the year ended 30 June 2008
$ $ $ $
Opening Stock 17,200 Sales 156,000
Purchases 94,000 Less: Returns Inwards (2,000) 154,000
Add: Carriage inwards 1,400 95,400
Cost of goods available for
sale 112,600
Less Closing stock (17,600)
Cost of Sales 95,000
Gross Profit c/d 59,000
154,000 154,000

Carriage outwards 1,800 Gross Profit b/d 59,000
Wages and Salaries 9,500 Discount Received 3,400
Rent 9,800
Sundry Expenses 6,000
Bank Charges 100
Provision for Doubtful Debts 600 27,800
Net Profit 34,600
62,400 62,400


Farah Adeebah
Balance Sheet as at 30 June 2008
$ $ $ $
Fixed Assets Owners Equity:
Fixtures and Fitting 28,000 Opening Capital 54,900
Add: Net Profit 34,600
Current Assets 89,500
Stock 17,600 Less: Drawings 20,000
Cash at Bank 13,500 Closing Capital 69,500
Debtors 30,000
(-) Provision for Doubtful Debts (600) 60,500 Current Liabilities
Creditors 18,800
Owing Expenses 200 19,000

88,500 88,500










PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
56
EXERCISE C
Shahrifah
Trading, Profit and Loss Account for the year ended 31 December 2006
$ $ $ $
Opening Stock 15,104 Sales 74,400
Purchases 46,224 Less: Sales Returns (1,760) 72,640
Less: Purchases Returns (1,420)
44,804
Add: Carriage inwards 936 45,740
Cost of goods available for
sale 60,844
Less Closing stock (10,198)
Cost of Sales 50,646
Gross Profit c/d 21,994
72,640 72,640

Interest on loan 500 Gross Profit b/d 21,994
Bad debts 350 Rent Received (owing) 3,000
Provision for doubtful debts 1,396 Net Loss 2,394
Transports 1,304
Salaries 10,658
Motor expenses 2,972
Insurance 3,400
Rent 2,000
Water & Light 2,500
Stationery 2,308 27,388
27,388 27,388

Balance Sheet of Shahrifah as at 31 December 2006
$ $ $ $
Fixed Assets Owner's Equity
Office Equipment 9,600 Capital on 1 Jan 41,376
Furniture 2,400 12,000 Less: Net Loss (2,394)
38,982
Current Assets Less: Drawings (8,200)
Closing stock 10,198 Capital on 31 Dec 30,782
Debtors 13,958
Less: Provision for bad debts 1,396 12,562 Long-term Liabilities
Revenue Owing 3,000 Bank Loan 10,000
Bank 15,504
Cash 480 Current Liabilities
Prepaid Expenses 904 42,648 Creditors 12,180
Expenses Owing 1,686 13,866
54,648 54,648





PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
57

EXERCISE D
Rizqun
Trading, Profit and Loss Account for the year ended 30 June 2007
$ $ $ $
Opening Stock 16,750 Sales 45,300
Purchases 21,050 Less: Sales Returns (300) 45,000
Less: Purchases Returns (1,050)
20,000
Add: Duty on Purchases 2,160
Carriage inwards 1,750 23,910
Cost of goods available for sale 40,660
Less Closing stock (18,000)
Cost of Sales 22,660
Gross Profit c/d 22,340
45,000 45,000

Repairs and maintenance 680 Gross Profit b/d 22,340
Carriage outwards 540 Discount Received 280
Rent 4,200 Commission Received 1,400
Bad debts 300 Provision for Doubtful Debts 75
Depreciation of vehicles 4,200 9,920
Net Profit 14,175
24,095 24,095

Balance Sheet of Rizqun as at 30 June 2007
$ $ $ $
Fixed Assets Owner's Equity
Motor Vehicles 30,000 Capital on 1 July 06 35,000
Less: Provision for Depreciation (13,200) 16,800 Add: Net Profit 14,175
Office Equipment 7,500 24,300 49,175
Less: Drawings (1,550)
Current Assets Capital on 30 June 07 47,625
Stock 18,000
Debtors 4,500 Current Liabilities
Less: Provision for bad debts (225) 4,275 Creditors 5,050
Deposit for rent 350 Accrued Carriage Inwards 600
Bank 6,750 29,375 Commission in advance 400 6,050


53,675 53,675








PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
58

EXERCISE E

Qaisara
Income Statement for the year ended 31 August 2010
$ $ $ $
Opening Stock 9 650 Sales 121 300
Purchases 67 600
Add: Carriage on purchases 1 260
78 510
Less Closing stock (11 200)
Cost of Sales 67 310
Gross Profit c/d 53 990
121 300 121 300

Wages and salaries 26 050 Gross Profit b/d 53 990
Rent and rates 7 200 Discount Received 460
Insurance 1 480 Rent Received 1 750
Sundry expenses 10 760
Provision for doubtful debts 450
Depreciation: Fixtures and equipment 2 000
Accountancy fees 1 500 49 440
Net Profit 6 760
56 200 56 200

Balance Sheet of Qaisara as at 31 August 2010
$ $ $ $
Fixed Assets Owner's Equity
Fittings and equipment 10 000 Capital on 1 Sept 2009 29 000
Less: Provision for Depreciation (2 000) 8 000 Add: Net Profit 6 760
35 760
Current Assets Less: Drawings (18 220)
Stock 11 200 Capital on 31 Aug 2010 17 540
Debtors 11 250
Less: Provision for bad debts (450) 10 800 Current Liabilities
Prepaid rent and rates 150 22 150 Creditors 7 200
Bank overdraft 1 560
Wages and salaries Accrued 2 350
Accountancy fee accrued 1 500 12 610

30 150 30 150








PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
59





Exercise A

Manufacturing Account for the year ended 31 December 2008
Raw Materials: $ $ $
Stock 1 Jan 22,100 Production Cost 612,700
Purchases 234,500
Carriage on Purchases 67,900
324,500
Less: Closing Stock 23,400
Cost of raw material used 301,100
Direct wages 111,300
PRIME COST 412,400
Factory Overhead:
Depreciation on Machinery 45,300
Factory Salaries 71,200
Electricity 66,100
Factory Insurance 12,000
Factory cleaning 5,700 200,300
612,700 612,700


Exercise B

Manufacturing Account for the year ended 31 December 2008
Raw Materials: $ $ $
Stock 1 Jan 31,500 Production Cost 145,795
Purchases 99,000
Duty on raw material 3,510
134,010
Less: Closing Stock 41,400
Cost of raw material used 92,610
Production wages 33,750
PRIME COST 126,360
Factory Overhead:
Factory supervisors wages 8,000
Factory power 1,200
Factory rent 2,000
Other factory expenses 4,230 15,430
Work in progress:
Opening WIP 17,100
Less: Closing WIP 13,095 4,005

145,795 145,795


Topic 16 : Manufacturing Accounts
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
60
Exercise C

Manufacturing Account for the year ended 31 December 2008
Raw Materials: $ $ $
Stock 1 Jan 1,108 Cost of Production 35,887
Purchases 14,209
Less: Returns (900) 13,309
Carriage inwards 3,982
18,309
Less: Stock 30 June 2008 (1,190)
Cost of raw material used 17,119
Manufacturing wages 7,776
PRIME COST 24,895
Factory overheads:
Salaries 4,725
Rent 1,260
Insurance 420
Electricity 900
Depreciation on Plant and Mac 3,662 10,967
Work in Progress
Opening 458
Less: Closing (433) 25
35,887

Trading Account for the year ended 31 December 2008
Finished Goods $ $
Opening Stock 2,367 Sales 52,704
Cost of Production 35,887
38,254
Less: Closing stock (3,558)
Cost of goods sold 34,696
Gross Profit 18,008
52,704 52,704


Profit and Loss Account for the year ended 31 December 2008
$ $ $
Office wages 2,592 Gross profit 18,008
Office salaries 1,312
Advertising 806
Depreciation on Motor Vans 1,120
Depreciation on Furniture 338
Office Rent 420
Total expenses 6,168
Net Profit 11,840
18,008 18,008




PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
61
Exercise D

Manufacturing Account for the year ended 31 December 2008
Raw Materials: $ $ $
Stock 1 Jan 1,108 Market value 50,000
Purchases 14,209
Less: Returns (900) 13,309
Carriage inwards 3,982
18,309
Less: Stock 30 June 2008 (1,190)
Cost of raw material used 17,119
Manufacturing wages 7,776
PRIME COST 24,895
Factory overheads:
Salaries 4,725
Rent 1,260
Insurance 420
Electricity 900
Depreciation on Plant and Mac 3,662 10,967
Work in Progress
Opening 458
Less: Closing (433) 25
Cost of Production 35,887
Gross Profit on Manufactured goods 14,113
50,000 50,000

Trading Account for the year ended 31 December 2008
Finished Goods $ $
Opening Stock 2,367 Sales 52,704
Add: Market value 50,000
52,367
Less: Closing stock (3,558)
Cost of goods sold 48,809
Gross Profit 3,895
52,704 52,704


Profit and Loss Account for the year ended 31 December 2008
$ $ $
Office wages 2,592 Gross profit:
Office salaries 1,312 Manufactured goods 14,113
Advertising 806 Trading 3,895
Depreciation on Motor Vans 1,120
Depreciation on Furniture 338
Office Rent 420
Total expenses 6,168
Net Profit 11,840
18,008 18,008


PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
62
Exercise E

Manufacturing Account for the year ended 31 December 2008
Raw Materials $ $ $
Opening stock 3,900 Production Cost 88,680
Purchases 37,800
41,700
Closing Stock (4,500)
Cost of raw material used 37,200
Direct expenses:
Manufacturing wages 21,900
PRIME COST 59,100
Factory overhead Indirect expenses
Depreciation on manufacturing Plant 5,430
Factory expenses 10,200
Factory Electricity 7,560
Factory Rent 6,480
29,580
88,680 88,680


Trading and Profit and Loss Account for the year ended 31 December 2008
Finished Goods $ $ $
Opening Stock 8,400 Sales 150,000
Production Cost 88,680
97,080
(-) Closing Stock (9,900)
Cost of Sales 87,180
Gross Profit 62,820
150,000 150,000

Loan interest 1,200 Gross Profit on Trading 62,820
Depreciation on Delivery van 2,250
Office Rent 720
Office Electricity 840
Office salaries 8,400
General office expenses 3,300
Delivery van expenses 3,900
Wages of delivery van drivers 9,000
Advertising 6,900
Bad Debts 1,200 37,710
Net Profit 25,110
62,820 62,820








PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
63
Exercise F

Manufacturing Account for the year ended 31 October 2010
Raw Materials $ $ $
Opening stock 26 700 Production Cost 422 360
Purchases 213 200
239 900
Closing Stock (30 640)
Cost of raw material used 209 260
Direct factory wages 157 400
PRIME COST 366 660
Factory overhead
Factory managers salary 14 800
Indirect factory expenses 23 200
Depreciation of factory plant
and machinery 18 000 56 000

Work in Progress:
Opening 7 900
Less: Closing (8 200) (300)
422 360 422 360


Trading and Profit and Loss Account for the year ended 31 October 2010
Finished Goods $ $ $
Opening Stock 2 450 Sales 525 300
Production Cost 422 360
Purchases 15 800
Less: Purchases Returns (900) 14 900
439 710
(-) Closing Stock (2 150)
Cost of Sales 437 560
Gross Profit c/d 87 740
525 300 525 300

Office salaries 36 200 Gross Profit b/d 87 740
Sundry office expenses 18 600 Discounts received 5 100
Distribution costs 21 540 Reduction in provision
Depreciation of office equipment 3 456 79 796 for doubtful debts 11
Net Profit 13 055
92 851 92 851










PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
64

Balance Sheet of Hamada as at 31 October 2010
Cost Prov NBV $ $
Fixed Assets $ $ $ Owner's Equity
Factory plant & machinery 80 000 54 000 26 000 Capital on 1 Sept 2009 80 740
Less: Provision for Depreciation 24 000 18 816 5 184 Add: Net Profit 13 055

104 000
72 816 31 184 93 795
Current Assets Less: Drawings (11 600)
Stock: Capital on 31 Aug 2010 82 195
Raw materials 30 640
Work in progress 8 200 Current Liabilities
Finished goods 2 150 40 990 Creditors 19 600
Debtors 39 450 Accrued direct factory wages 12 100 31 700
Less: Provision for Doubtful debts (789) 38 661
Cash at bank 1 200
Prepaid distribution costs 1 860 82 711



113 895 113 895










Overtime

Normal time 40 hrs x $10 = $ 400
Overtime at time and a half 4 hrs x 1 x $10 = $ 60
Overtime at double time 2 hrs x 2 x$10 = $ 40
Gross Pay = $ 500



Commission

Basic salary : $ 800
Commission (5% x $100,000) : $ 5,000
Total gross salary : $ 5,800







Topic 17 : Payroll Accounting
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
65
SALARY DEDUCTION
Gross salary $4,000
Less: Deductions
PAYE $1,000
Health surcharge $ 80
National Insurance $ 120
Union dues $ 50
Credit Union $ 500 ($ 1,750)
Net Salary $2,250

PAYROLL REGISTER
Payroll Register
Employee
Hours
worked
Pay rate
per hour
$
Overtime
(hours)

Gross Pay

$
Deductions
Total
Deductions
$

Net Pay
$
National
Insurance
$
PAYE
$
Abadi 40 2.00 80.00 3.23 10.22 13.45 66.55
Batrisya 44 3.00 4 138.00 5.78 27.94 33.72 104.28
Chombi 40 2.50 100.00 5.09 9.90 14.99 85.01
Dahlia 16 2.50 40.00 2.51 2.46 4.97 35.03
Elia 40 2.50 100.00 5.09 10.00 15.09 84.91
Farhan 40 2.00 80.00 4.73 5.32 10.05 69.95
Gopal 44 4.50 4 207.00 3.50 31.95 35.45 171.55
Harita 40 2.50 100.00 3.59 16.50 20.09 79.91

Example A:
Abu Bakars Cake House
Cash Book
$ 2009 $
July 14 Wages 1,900


Wages account
2009 $ $
July 14 Cash 1,900
Income tax 620
National Insurance 350
Pension contribution 100
Trade union subscription 230

Income Tax account
$ 2009 $
July 14 Wages 620


National Insurance account
$ 2009 $
July 14 Wages 350

PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
66


Pension Fund account
$ 2009 $
July 14 Wages 100


Trade Union subscription account
$ 2009 $
July 14 Wages 230


The Journal Entries of Abu Bakers Cake House:
Abu Bakars Cake House
Journal
2009 Debit Credit
July $ $
14 Wages 1,900
Cash 1,900

Wages 1,300
Income tax 620
National Insurance 350
Pension contribution 100
Trade union subscription 230
Deductions from gross wages
Cash 1,900
Income tax 620
National Insurance 350
Pension contribution 100
Trade union subscription 230
Bank 3,200
Payments of statutory and voluntary deductions

Exercise A

Employee
Hours
worked
Pay rate per
hour
$

Gross Pay

$
Deductions
Total
Deductions
$

Net Pay
$
National
Insurance
$
PAYE
$
Pian 40 100 4,000 80 200 280 3,720
Reza 40 90 3,600 72 180 252 3,348
Agra 40 80 3,200 64 160 224 2,976
Amin 40 60 2,400 48 96 144 2,256
Halim 40 50 2,000 40 80 120 1,880
TOTAL 15,200 304 716 1,020 14,180

Ledgers :
PRINCIPLES OF ACCOUNTS
Prepared by: Hajah Marhani & Hajah Harita
Year
9
67

Cash Book
$ 2009 $
July 14 Wages 14,180


Wages account
2009 $ $
July 14 Cash 14,180
Income tax 716
National Insurance 304

Income Tax account
$ 2009 $
July 14 Wages 716


National Insurance account
$ 2009 $
July 14 Wages 304


The Journal Entries:
Ali Momins Journal
2009 Debit Credit
July $ $
14 Wages 14,180
Cash 14,180
Payments of Wages
Wages 1,020
Income tax 716
National Insurance 304
Deductions from gross wages
Income tax 716
National Insurance 304
Wages 14,180
Bank 15,200
Payments of statutory and voluntary deductions