Mid Term Examination Fall-2020

Subject: Principles of Accounting/ Financial Accounting Principles

Facilitator: Moona Shamim/Khurram Pervaiz/Dr Riaz/Abdus Salam, Waseem Uddin/
Yasin turabi
Available date: 22nd November 2020(12:00 AM) Day Monday
Submission 29th November 2020(12:00 AM) Max. Marks: 20
date

Please follow the instructions carefully:

Note : Attempt all questions on Ms. Excel Solution template file which is upload on
Blackboard Midterm exam 2020 folder.

1. Write your name and registration ID on the first page of your Ms. excel file.
2. Answer scripts can be uploaded on Black board any time before its deadline.
Therefore, do not wait for the last hour to avoid any unforeseen problems.
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board only. Therefore, do not submit your document through email or any
other medium.
4. Use 12 pt. font size and Times New Roman font style along with 1-inch page
margins.
5. Follow the requirements of the word limit and the marking criteria while writing
your answers.
6. Provide relevant, original and conceptual answers, as this exam aims to test your
ability to examine, explain, modify or develop concepts discussed in class.
7. Do not copy answers from the internet or other sources. The plagiarism of your
answers may be checked through Turnitin.
8. Recheck your answers before the submission on Black board to correct any content or
language related errors.
9. Double check your Ms. Excel file before uploading it on Black board to ensure that
you have uploaded the correct file with your answers.
Q1. Presented here are the accounts of KPMS Delivery for the year ended December 31,
2018.

Owner investment,2018 $ 32,000 Land $ 7,000

Accounts payable $ 14,000 Notes payable $ 30,000
Accounts receivable $ 1,700 Property tax expense $ 2,900
Advertising expense $ 17,000 KPMS, drawing $ 32,000
Building $ 137,900 Rent expense $ 13,000
Cash $ 6,000 Salary expense $ 69,000
Equipment $ 17,000 Salary payable $ 500
Insurance Expense $ 2,000 Service revenue $ 192,000
Interest Expense $ 6,000 Supplies $ 8,000
KPMS, Capital 12/31/2018 $ 51,000

Requirements:

1. Prepare KPMS Delivery’s income statement. (3 Marks)

2. Prepare the statement of owner’s equity. (3 Marks)
3. Prepare the balance sheet. (3 Marks)
4. Answer these questions about the company:(1 Marks)
a. Was the result of operations for the year a profit or a loss? How much?
b. How much in total economic resources does the company have as it moves
into the new year?
c. How much does the company owe to creditors?
d. What is the dollar amount of the owner’s equity in the business at the end of
the year?
 Q2. The trial balance of Saltish Sacha, CPA, is dated March 31, 2018:

Saltish Sacha, CPA

Trial balance
March 31, 2018
Account no. Account Debit Credit

11 Cash $ 5,000
12 Accounts receivable $ 8,100
13 Supplies $ 800
14 Land $ 14,000
21 Accounts payable $ 4,200
31 Capital, Saltish Sacha $ 23,700
32 Drawing, Saltish Sacha
41 Service revenue
51 Salary expense
52 Rent expense
Total $ 27,900 $ 27,900

During April, Saltish Sacha or his business completed the following transactions:
April 4 Collected $7,000 cash from a client on account.
April 8 Performed tax services for a client on account, $5,000.
April 13 Paid business debt on account, $2,500.
April 18 Purchased office supplies on account, $600.
April 20 Saltish Sacha withdrew cash of $2,300.
April 21 Saltish Sacha paid for a deck for his private residence, using personal funds,
$12,000.
April 22 Received $2,100 cash for consulting work just completed.
April 27 Paid office rent, $300.
April 28 Paid employee salary, $1,300
Requirements
1. Record the April transactions in the journal.Include an explanation for each entry.(5 Marks)
2. Post the transactions in the ledger. Open the ledger accounts listed in the trial balance,
together with their balances at March 31. (3 Marks)
3. Prepare the trial balance of Saltish Sacha, CPA, at April 30, 2018. (2 Marks)