BACHELOR OF MANAGEMENT WITH HONOURS (BIM)

JAN/2020

BBAW2103

FINANCIAL ACCOUNTING

NO. MATRIKULASI : 881122265027001

NO. KAD PENGNEALAN : 881122265027
NO. TELEFON : 0134392157
E-MEL : eyezat@ymail.com

PUSAT PEMBELAJARAN : IPOH

ASSIGMENT 1

Qualitative Characteristics of Accounting Information

There are some qualities of accounting that make it useful for both external and internal users of
accounting. Without these qualities accounting information wouldn’t be clear and an orderly view of
the business would not be visible. 4 qualitative characteristics of accounting information are;

Comparability

Comparison is a very important part of financial information as it helps the users of accounting
information to differentiate, analyze, improve, and take important decisions.

The ability to do intra-firm comparison (within the same company), inter-firm comparison (with

other companies), and market sector comparison (comparison within the same market sector) makes
accounting information easy to work with.

Example of Comparability – QoQ (Quarter on Quarter) & YoY (Year on Year comparisons) should be
possible with the accounting information.

Understandability

The presentation of accounting information should be simple and understandable for the users of the
information. It is important that all the data is clear and concise, it can be easily understood by
everyone including parties who are not from the accounting background.

All relevant explanatory notes should be provided along with the financial statements. Method of
valuation of inventory, method of depreciation, information on reserves and surplus, contingent
liabilities, and any other extraordinary items.

Example of Understandability – It should be possible for bankers, investors, employees, etc. to

understand financial information of the business.

Reliability

One of the most important among qualitative characteristics of accounting information is reliability of
data,example all information provided must be traceable and verifiable with proper source
documents.

In case of an internal or an external audit the information inside financial statements should be
confirmable back to its original source. Failure of an audit may lead to disbelief in the company’s
financial data.

Example of Reliability – An auditor must be able to verify a transaction back to its origin with the help
of invoices, memos, purchase order, sales order, etc.

Relevance

Relevance of accounting information means it should help the user of information with their decision
making process. The information provided should not be irrelevant and unnecessary. All
information should be capable of monetary computation.

Example of Relevance – A firm is expected to provide the total amount owed by the debtors in the
balance sheet, whereas the total number of debtors is not important.
ASSIGNMENT 2

Question 1 (a)
Transactio Hashem Legal Services
Debit Credit
n December 2019

RM RM

1
Cash 50,000.00

Office Equipment 12,000.00

Capital 62,000.00

2
Drowing 12,000.00

Cash 12,000.00

3 Cash 3,000.00

Debtor 4,000.00

Sales 7,000.00
4 Office Supplies 2,000.00

Cash 2,000.00
5 Advertising Expenses 700.00

Cash 700.00
6 Debtor 5,000.00

Sales 5,000.00
7 Cash 3,000.00
Unearned Sales
Revenue 3,000.00

8 Employee ' salary 3,600.00

Cash 3,600.00

9 Office Rental 2,400.00

Cash 2,400.00

10 Office Supplies Expenses 400.00

Office Supplies 400.00

Question 1 (b)

TRANSACTION CASH OFFICE EQUIPMENT DEBTOR OFFICE SUPPLIES CAPITAL PROFIT / LOSS

RM RM RM RM RM RM
1 50000 50000
12000 12000
2 -12000 -12000

3 3000 4000 7000

4 -2000 2000

5 -700 -700

6 5000 5000

7 3000 3000

8 -3600 -3600

9 -2400 -2400

10 -400 -400
35300 12000 9000 1600 50000 7900

57900 57900
Question 2 (a)
KEMBARA ENTERPRISE AS AT 31 DECEMBER 2019

RM RM RM

FIXED ASSET

Furniture & Fitting 22,600.00

(-) Accumulated Depreciation 12,660.00

9,940.00

CURRENT ASSET

Cash 20,000.00

Inventory 22,800.00

Account receivable 15,200.00

Prepaid insurance 3,600.00

Office supplies 2,500.00

Prepaid advertising 3,700.00

67,800.00

(-) Current Liabilities

Account payable 17,500.00

Accrued rental 2,200.00

Accrued salaries expenses 3,300.00

Accrued utility expenses 350.00

Accrued Interest in long term loan 900.00

24,250.00

43,550.00
OWNER EQUIPMENT 53,490.00

Capital

(-) Loss 2,400.00

-5,310.00

18,690.00

Long term liabilities

Long term loan 12,000.00

30,690.00
Question 2 (b)

Sales revenue RM RM

Uneained sale revenue 42,000.00

3,700.00
(-) COGS 45,700.00
(-) Inventory
Gross Pntit -22800
22900
(-) Expenses
Rental Expenses
Salaries Expenses 15400
Utilities 6100
Depreciation Expenses : Furniture & Fitting 1550
Office Supplies Expenses 2260
Interest on long term loan 2000
900
28210
5,310.00
Question 2 (c )
Balance sheet Debit Credit
RM RM

Cash (18500 + 1200 + 300) 20,000.00

Accounts receivable 15,200.00

Prepaid insurance 3,600.00

Inventory 22,800.00

Office supplies 2,500.00

Prepaid advertising 3,700.00

Furniture & fittings 22,600.00

Accumulated depreciation - Furniture &
fittings (10400 + 2260) 12,660.00
Unearned sales revenue 3,700.00

Accounts payable 17,500.00

Long term loan 12,000.00

Capitan - Kembara 24,000.00

Sales revenue 42,000.00

Salaries expenses ( 5800 + 3300 ) 6,100.00

Rental expenses (13200 + 2200) 15,400.00
Utilities expenses (1200 +350) 1,550.00
Deprecration Expenses : Furniture & fitting 2,260.00

Office supplies expenses 2,000.00

Accrued rental expenses 2,200.00

Accrued salaries expenses 3,300.00

Accrued utility expenses 350.00

Interest on long term loan 900.00

Accrued interest on long term loan 900.00

118,610.00 118,610.00