MINISTRY OF FINANCE Final Assessment 2

ACADEMY OF FINANCE Subject: Accounting for Trading- Services Enterprises

Code: 04.05/2021 Duration: 1 day

PART A:
1 On April 2, Cion Co. purchased merchandise from Jose Co. for 210.000 (exclusive VAT
10%), terms 2/10, n/30 FOB shipping point. On April 12, paid the amount due to Jose Co. in
full. Dion Co used perpetual inventory system.
a. Prepare the journal entries to record the transaction on April 2 in Cion Co.
b. Prepare the journal entries to record the transaction on April 12 in Cion Co.
c. Assume that Cion Co. paid the balance due to Jose Co. on April 20 instead of April
12. Prepare the journal entry to record this payment.
2 Luci Co. imported goods, price of goods in invoice $8.000, the import tax 20%, The special
consumption tax 30%, the VAT tax 10%, the customs rate of exchange: $1= VND 23, the
approximate exchange rate: $1= VND 23,1, the customs value of goods is the same as the
the value of goods in invoice.
a. Determine the cost of goods imported.
b. Determine the import tax
c. Determine the special consumption tax
3 a/“The primary source of revenue for a merchandising company results from performing
services for customers”.True or false?
b/“Trade company does not carry out a production process for goods solds”. True or false?
c/If beginning inventory is 60.000, cost of goods sold is 380.000, and ending inventory is
50.000, cost of goods purchased is___________
d/A situation in which a company sells its products directly to customers in another country
without using another person or organization to make arrangement for them is called _____
e/ What will result if gross profit are greater than operating expenses?
a/The average-cost method in a periodic inventory system is called__________
b/Which inventory system that company keeps detailed inventory records of the each
4 inventory purchase and sale?
c/ “The freight costs incurred by the buyer are operating expenses”. True or false?
d/ That company that buys products and resell them with a large quantities is__________
Pan Company purchased 500(exclusive VAT 10%) of merchandise from Lan company, FOB
destination, freight cost: 20(exclusive VAT 10%) was paid by cash in bank(VND:1.000.000)
5 a. Which company paid freight cost?
b. Which accounts were used for freight cost transaction of Lan company.
c. Prepare entries for freight cost transaction for Lan company.
Dash Co. received export entrustment fees from Smath Co. by VND in bank of 110.000
(inclusive of VAT 10%).(VND: 1.000).
6
a. Which company is export truster?
b. Make entries for this transaction in export truster.

PART B
Question 7: Lith Co. began operation on July 1, using a perpetual inventory system. During
July, the company had the following purchases and sales:

Date Quantity Unit cost Unit sale

July 1 5 122
July 6, sale 2 Y1
July 11, purchase 7 136
July 14, sale 6 Y2
July 21, purchase 8 147
July 27, sale 8 Y3
Require:
- Give Y1,Y2,Y3 by yourself
- Determine cost of goods sold, the ending inventory, gross profit under perpectual and
periodic inventory system using FIFO, average cost method.

Question 8
Dutch Co, a Vietnamese company, uses a perpetual inventory system and tax deduction
method. During March, 2020, the following transactions occurred (VND: 1.000)
Mar.2 Purchased merchandise from Tuan Company for 22.000 (exclusive of VAT 10%) under
credit terms of 1/20, n/30, invoice dated Mar 2. Freight charges 2.200 (exclusive of VAT
10%) paid cash in bank.
4. Prepaid $5.000 by cash in bank for import entrustment contract to Lux to open L/C. The
accounting book exchange rate: $ 1= VND 22,9
5. Sold merchandise to T&T Corp for 52.800 (inclusive of VAT 10%) under credit terms of
1/20, n/60, invoice dated Mar 5. The merchandise had cost 30.000.
12. Paid 8.000 (exclusive of VAT 10%) by cash in bank for shipping charges related to the Mar
5 sale to T&T Corp.
13. Received import entrustment goods with total value of $X1 delivered by Lux (import
trustee). The imported good was put into the warehouse, the import tax 30%, the VAT tax
10%. The Customs rates of exchange $1= VND 23,1. The customs value of the goods =
value of good in invoice. Lux paid on behalf of the import truster all kind of tax payable to
the government budget by VND in bank. The import entrustment fee accounts for 1% on the
contract value.
15. T&T returned merchandise from the Mar 5 sale that had cost 500 and been sold for 770
(inclusive of VAT 10%). The merchandise was restored to inventory.
17. The import entrustment fee to Lux was credited on account.
18. After negotiations with Tuan Corporation concerning problems with the merchandise
purchased on Mar 2, received a credit memorandum from Tuan granting a price reduction of
800 (exclusive of VAT 10%)
22. Paid the amount due Tuan Corporation for the Mar 2 purchase less the price reduction
granted.
25. Received balance due from T&T Corp. for the Mar 5 sale less the return on Mar 15.
28. Received the notice about the consigment goods that had been sold from the AA Agent with
costing of VND 25.000 for 40.000 (exclusive of VAT 10%), commission fee 4.000
(exclusive of VAT 10%).
29. Paid import entrustment fee and tax for Lux by VND in bank.
30. Received the balance due from AA Agent for the consigment goods less the commisson fee
30. Paid the rest of the payment for Lux by USD in bank on Mar 13, the accounting book
exchange rate $1= 23,1. Lux paid to the exporter by L/C and Cash in bank.
30. Accrued salary for administration component X2 and selling component X3
Require:
A. In Dutch Co
1. Give the opening balance of accounts at 1st, Mar, 2020 and X1,X2,X3 by yourself.
2. Journalize above transactions (including closing entries)
3. Prepare T accounts
4. Prepare trial balance for March, 2020
5. Prepare Statement of Financial Position as at 31st, March, 2020.
6. Prepare Statement of Profit or Loss for the period ended 31st, March, 2020.
B. Make the entries the transactions of Lux (import trustee)
(The approximate exchange rate: $ 1= VND 23)

Part C: Identify the differences between the merchandising company and manufacturing
company?