Final-Term Exam (Take-Home) Fall – 2020

Department of Business Administration

Subject:
Financial Accounting Principles Submission Date: 30th January (10:00Am)
Instructor: Dr. Abid Mehmood/Dr. Riaz Ahmad
Program: BBA Max. Marks: 40

Please follow the instructions carefully:

1. Write your answers on MS word or A4 Paper that will convert into PDF and then submit
before the due date on Blackboard.
2. Answer can only be submitted on Blackboard any time before its deadline.
3. To avoid any unforeseen problems, you are advised NOT to wait for the last hour to submit
your answer.
4. Submission of answer copy(ies) will be considered acceptable through Blackboard only.
Therefore, do not submit your document through email or any other medium (telegram/email/
WhatsApp etc).
5. Use 12 pt. font size and Times New Roman font style along with 1-inch page margins.
6. Follow the requirements of the word limit and the marking criteria while writing your answers.
7. Provide relevant, original and conceptual answers, as this exam aims to test your ability to
examine, explain, modify or develop concepts discussed in class.
8. Do not copy answers from the internet or other sources. The plagiarism of your answers may be
checked through Turnitin.
9. Recheck your answers before the submission on BlackBoard to correct any content or language
related errors.
10. Double check your Answer before submitting it on BlackBoard to ensure that you have
submitted the correct answers.
Important Instructions:
1. First logging into your blackboard Account.
2. Click on Final Exam Paper 2021 which is available on left side of main screen of blackboard.

3. Click on any Sections which you want to attempt first.

4. Section A – Objective Types – MCQs & True and False (20 Marks)
5. Section B- Comprehensive Part (20 Marks)

Guidelines for Section A of Final Exam Paper 2021(20 Marks)

 There are total 40 Objectives, 0.50 mark each.
 Total # Attempts: 2
 Duration: 3 hours for each attempt.
 In Every attempt students will get different questions from the Questions bank.
 Criteria for selection: Highest grade will be considered in all three attempts.
 It is recommended to use System/Laptop for Final Exam. (Don’t try to attempt your paper
by using mobile phones etc.).
 Try to use stable Internet connection otherwise your attempt will lose due to technical
glitches.

Guidelines for Section B of Final Exam Paper 2021(20 Marks)

 There are total 4 Questions, each questions carry equal marks.
 Total # Attempts: 2
 Solve on MS word or A4 Paper that will convert into PDF and then submit your work on black
board.
 Duration: January 24th , 2021 (9:00 Am) till January 30th , 2021 (10:00 Am)

 Total two (2) Attempts are provided.

 Section B (20 Marks)

Q1. (05 Marks)

The comparative balance sheet for ENGRO Corporation is presented below:
ENGRO CORPORATION
Comparative Balance Sheet
2019 2018
Assets
Cash RS 36,000 RS 31,000
Accounts receivable (net) 70,000 60,000
Prepaid insurance 25,000 17,000
Land 18,000 40,000
Equipment 70,000 60,000
Accumulated depreciation (20,000) (13,000)
Total Assets RS 199,000 RS 195,000

Liabilities and Stockholders' Equity

Accounts payable RS 11,000 RS 6,000
Bonds payable 27,000 19,000
Common stock 140,000 115,000
Retained earnings 21,000 55,000
Total liabilities and stockholders' equity RS 199,000 RS 195,000

Additional information:
1. Net loss for 2019 is RS 20,000.
2. Cash dividends of RS 14,000 were declared and paid in 2019.
3. Land was sold for cash at a loss of RS 4,000. This was the only land transaction during the year.
4. Equipment with a cost of RS 15,000 and accumulated depreciation of RS 10,000 was sold for RS 5,000
cash.
5. RS 22,000 of bonds were retired during the year at carrying (book) value.
6. Equipment was acquired for common stock. The fair value of the stock at the time of the exchange was
RS 25,000.
Instructions
Prepare a statement of cash flows for the year ended 2019 by using the Indirect method.

Q2. (05 Marks)

A plant asset acquired on October 1, 2014, at a cost of $400,000 has an estimated useful life of 10
years. The salvage value is estimated to be $40,000 at the end of the asset's useful life.

Instructions

Determine the depreciation expense for the first two years using:

(a)     the straight-line method.

(b)     the double-declining-balance method.
Q.3 (05 Marks)
The following accounts appear in the ledger of Akram Inc. after the books are closed at December 31, 2018.

Common Stock, RS1 par value, 500,000 shares authorized, 400,000 shares
issued RS 400,000
Common Stock Dividends Distributable 60,000
Paid-in Capital in Excess of Par—Common Stock 650,000
Preferred Stock, RS 100 par value, 6%, 10,000 shares authorized; 2,000 shares
issued 200,000
Retained Earnings 920,000
Treasury Stock (10,000 common shares) 85,000
Paid-in Capital in Excess of Par—Preferred Stock 310,000

Instructions
Prepare the stockholders' equity section at December 31, 2014, assuming that retained earnings is restricted for
plant expansion in the amount of RS 200,000.

Q4.a) Who is the Father of Accounting? (05 Marks)

b) Explain his contributions?