BAAB1014 BUSINESS ACCOUNTING

Assignment Guidelines and Rubrics

Assignment 1 – 20%

Learning outcomes

1. Explain the basic concepts of accounting, bookkeeping and cost accounting terminology.
2. Systematically recording business transactions in appropriate accounting records.
3. Prepare basic financial statements, management reports and various alternative cost
management system.

Instructions/Writing Prompts

Group Assignment (Instructions) 20%

Please refer to the file below for the details of your assignment. This is a group assignment which carries
20% and is based on what you have learnt in Lesson 1 - Lesson 6.

The due date for this assignment is by the end of Week 10.

The assignment is attached.

1
Instructions: Answer all questions.

Question 1

Mr. Badrol established a tour agency on 1 January 2021. The transactions for the month are as follows:

Date Transactions
1 Started in business and deposited RM60,000 into a bank account opened specially for the
business.

2 Owner buys some goods for RM8,000 from Salleh, and agrees to pay them some time within
the next two weeks.

10 Bought office equipment worth RM10,000 by cheque.

11 Sold goods worth RM5,000 on credit.
12 Received cheque of RM5,000 from customer
14 Paid creditors amount due RM8,000 by cheque.
25 Paid utility expenses amounting to RM400 by cheque.
27 The business borrows RM30,000 from the bank, the loan to be repaid in 3 years.
30 Received dividend for the year 2021 for RM5,000. This amount has been credited in the
company’s bank account.

As per the example provided below, you are required to:

1 January 2021- Started in business and deposited RM60,000 into a bank account opened specially for
the business.

2019 Effects Account to be Account to be Book prime of

debited credited entry
Jan 1 Increase asset Bank RM 60,000 General journal
Increase capital Capital RM60,000

a) Show the effects (increase/decrease) upon assets, liabilities, expenses, revenue and owner’s
equity for the transactions.
(4 marks)
b) State the journal entries (debit/credit).
(4 marks)
c) Identify the appropriate book of prime entry to record the transactions.
(2 marks)
(Total:10 Marks)

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Question 2

The following list of balances was extracted from the books of Super Maju Enterprise as at 31 December
2021.

RM RM
Purchases 87,250
Sales 152,000
Return inwards 3,000
Return outwards 2,250
Drawings 4,750
Inventory (1 January 2021) 13,000
Buildings 79,750
Motor vehicles (cost RM34,750) 22,150
Fixtures and fittings (cost RM24,250) 19,350
Cash at bank 15,600
Salaries 17,000
Carriage inwards 3,150
Carriage outwards 4,300
Account receivable 29,750
Account payable 14,750
Water and electricity 3,640
Insurance 2,160
Allowance for doubtful debts 500
Discount allowed 150
Discount received 100
Rent revenue 4,250
Rates 3,000
Loan from Affin Bank 24,750
Interest on loan 750
Commission revenue 250

capital 109,900

308,750 3087,50

The following additional information is available as at 31 December 2021:

a) Rent revenue received in advance amounting to RM750.

b) The loan from Affin Bank was taken on 1 July 2021 and the interest charged is 8% per annum.
c) Depreciation:
Motor vehicle -20% per annum on reducing balance method.
Fixtures and fittings – 10% per annum on straight line method.
d) Rate accrued was RM50.
e) Insurance expenses amounting to RM360 is for January 2022.
f) Commission revenue of RM500 was still not received.
g) Provision for doubtful debts should be increased by RM750.
h) The owner took RM1,000 cash to pay his son’s hospital bill.
i) Inventory as at 31 December 2021 is RM19,050.

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Required:

a) Prepare Super Maju Enterprise’s Income Statement for the year ended 31 December 2021.
(8 marks)
b) Prepare Super Maju Enterprise’s statement of financial position as at 31 December 2021.
(7 marks)
(Total:15 Marks)

Question 3

A. Bonika Sdn Bhd (BSB) manufactures small camping tents. BSB produced 3,000 units during the year.
These camping tents sell for RM150 each. BSB had 500 units in finished goods inventory at the
beginning of the year.At the end of the year,there were 800 units in finished goods inventory. The
following information was supplied by its accountant:

RM
Direct labour cost 10,500
Purchases of raw materials 15,000
Depreciation of machinery 1,000
Insurance expenses 4,500
Factory rent 2,000
Factory supervision 3,000
Utilities expenses 2,500
Indirect labour cost 3,500
Administration salaries 15,000
Sales Commission 12,000
Advertising 20,000
Materials inventory, May 1 6,000
Work in process inventory, May 1 12,000
Finished goods inventory, May 1 2,100
Materials inventory, May 31 8,000
Work in process inventory, May 31 7,000
Finished goods inventory, May 31 800

Additional information:
Only 70% of the utilities expense and 80% of the insurance expense apply to factory operations. The
remaining amounts should be charged to selling and administrative activities.

Required:
a) Compute prime cost, manufacturing cost and cost of goods manufactured.
(8 marks)
b) Compute cost of goods sold.
(2 marks)
c) Prepare an income statement.
(5 marks)
(Total: 15 Marks)

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Question 4

Rania Consultancy runs a training centre in Puchong. The firm charges RM250 per participant. The
estimated fixed cost of Rania Consultancy for the period is RM52,000. The variable costs per participant
is expected to be RM120.The variable costs consist of printed materials, stationery and refreshments. As
the Consultant of Rania Consultancy, find out the following information:

a) The number of participants needed to break even (in unit and in RM).
(3 marks)
b) The number of participants that they must have to earn a profit of RM80,000.
(2 marks)
c) The profit earned if 900 participants are trained in the period.
(2 marks)
d) The fees that Rania Consultancy should charge if the firm wants to earn a profit of RM80,000
from 900 participants, and all the costs remain as stated.
(3 marks)
(Total:10 Marks)

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