Student ID: 2102343

Student Name: Wee Geok Ting Madeline

Tutorial 1
ACC1001 Introduction to Financial Accounting
AY2021/22 Trimester 1

Question 1.

1a) Establishing limited liability partnerships between the owners and turning the
business into a corporation will enable the owners of Keyboard Warriors to limit
their risk of loss to the amounts they have invested in the business. This is
because by establishing limited liability partnerships between the owners, the
owners who have invested in the business will only be liable up to the investment
they have put in. Turning the business into a corporation means that the business
will be owned by shareholders, thus shareholders will have limited liability and
are only liable up to the investment they have put in.
1b) Sole proprietorship will give Mary Barry the most freedom to manage the
business as she wishes. This is because there is only one owner who is in charge of
decision making in a sole proprietorship.
1c) General partnerships will give creditors the maximum protection in the event
that keyboard warriors fail and cannot pay its debts. This is because the creditors
can seize the owner’s assets in the event that the debts cannot be repaid in
general partnerships which has more than one owner and the owners have
unlimited liability.

1
Student ID: 2102343
Student Name: Wee Geok Ting Madeline

Question 2.

2a) Going concern assumption

2b) Relevance and Accrual Accounting assumption
2c) Comparability characteristic
2d) Accrual Accounting assumption

2
Student ID: 2102343
Student Name: Wee Geok Ting Madeline

Question 3.

Barbed Wires
Statement of Income
Financial year ended 31 December 20X6
(Adapted, in millions of SGD)
Total Revenue $131
Total Expense ($54)
Net Profit $77

3
Student ID: 2102343
Student Name: Wee Geok Ting Madeline

Question 4.

Roam Corp
Statement of changes in equity
Financial year ended 31 December 20X6
Share Capital Retained Earnings Total equity
($’million) ($’million) ($’million)
Balance at 1 Jan $125 $300 $425
Income for the $185 $185
year
Dividends ($15) ($15)
Balance at 31 $125 $470 $595
December

The company’s retained earnings ending balance is $470 million.

4
Student ID: 2102343
Student Name: Wee Geok Ting Madeline

Question 5.

Grande Products
Statement of Financial Position
Financial year ended 31 December 20X6
Assets:
Cash and cash equivalents $15000
Accounts receivable $22000
Inventory $20000
Total current assets $57000
Equipment $79000
Total non-current assets $79000
Total Assets $136000
Liabilities:
Accounts Payable $21000
Total current liabilities $21000
Long Term Notes Payable $50000
Total non-current liabilities $50000
Total Liabilities $71000
Equity:
Share capital $35000
Retained earnings $30000
Total equity $35000
Total liabilities and equity $136000

5
Student ID: 2102343
Student Name: Wee Geok Ting Madeline

Question 6.

Angelababy Company
Statement of Income
Financial year ended 31 January 20X6
(Adapted, in millions of SGD)
Revenue $38.8
Expenses:
Interest Expense ($0.7)
Salary and other employee expenses ($17.5)
Other expenses ($6.7)
Total operating expenses ($24.9)
Net Profit $13.9

Angelababy Company
Statement of changes in equity
Financial year ended 31 January 20X6
(Adapted, in millions of SGD)
Retained Earnings Beginning Balance as at 1 January 20X6 $8.2
Net Income $13.9
Dividend ($1.5)
Retained Earnings Ending Balance as at 31 December 20X6 $20.6

6
Student ID: 2102343
Student Name: Wee Geok Ting Madeline

Question 7.

Angelababy Company
Statement of Financial Position
Financial year ended 31 January 20X6
(Adapted, in millions of SGD)
Assets:
Cash and cash equivalents $2.5
Accounts receivable $0.8
Investments $15.0
Other assets $5.0
Total current assets $23.3
Property and Equipment (net) $16.6
Total non-current assets $16.6
Total Assets $39.9
Liabilities:
Total current liabilities $2.0
Total non-current liabilities $3.0
Total Liabilities $5.0
Equity:
Share capital $14.3
Retained earnings $20.6
Total equity $34.9
Total liabilities and equity $39.9

7
Student ID: 2102343
Student Name: Wee Geok Ting Madeline

Question 8.

Smith Corporation (Division A)

Income Statement
Financial year ended 31 December 20X7
Revenues:
Service Revenue $250000
Sales Revenue $55000
Total Revenue $305000
Expenses:
Cost of goods sold ($32000)
Depreciation Expense ($3000)
Other expenses ($245000)
Total operating expenses ($280000)
Net Profit $25000