ASSIGNMENT COVER SHEET

NAME OF THE MODULE

COURSE NAME:

STUDENT NAME :

LO1

LO2

LO3

LO4

LO5
 GRADING MATRIX
GRADE GRADING SCALE GPA
A 94.50% − 100% 4.00
A- 89.50% − 94.40% 3.67
B+ 86.50% − 89.40% 3.33
B 82.50% − 86.40% 3.00
B- 79.50% − 82.40% 2.67
C+ 76.50% − 79.40% 2.33
C 72.50% − 76.40% 2.00
C- 69.50% − 72.40% 1.67
D+ 64.50% − 69.40% 1.33
D 59.50% − 64.40% 1.00
F 0% − 59.40% 0.00

GUIDELINES
1. Complete the title page with all necessary student details and ensure that the
signature of the student is marked in the declaration form.
2. All assignments must be submitted as an electronic document in MS Word to the LMS
(Use 12 Calisto MT font ).
3. The assignment should not contain any contents including references cited from website
like www.slideshare.net;www.scribd.com;www.ukessays.com ;
4. Students can refer Wikipedia as a source of information, but the references cited in
Wikipedia has to be mentioned.
5. Submit the assignment in a MS Word document with the file name being:

First Name : Name_Module Code.

Example : JakeBrown_FM201

Quick reference checklist for the Faculty/Instructor to accept/reject the

assignment before evaluation :

1. Aderence to the deadlne of submision date

2. Original cover sheet and format retained
3. Student information and signature intact
4. Front style and size used as instructed.
 DECLARATION

I, (Name), student of Swiss School of Management have completed the

assignment on (name of the module). I hereby confirm that no part of this

assignment/project has been plagiarised and references have been cited wherever literature

from external sources whether website, book or professional journals are used. I extend my

gratitude to my Faculty and all those who have directly and indirectly helped me in

completing this assignment.

I further confirm that I have read and hereby agree to the Swiss School of Management’s

code of conduct and plagiarism policy. I also understand that the grade assessment made by

the assessor / faculty is binding and final.

 ASSIGNMENT INFORMATION
Full/ Part Assignment Full
Date Assignment Issued
Date Assignment Due

TO BE FILLED BY THE FACULTY

Contact Email Id

TO BE FILLED BY THE STUDENT

Faculty Name
Student ID
Email ID
Course
Date Submitted

TO BE FILLED BY THE ASSESSOR

Max.Marks Marks
Awarded
Question 1
Question 2
Question 3
Question 4
Question 5
TOTAL
Overall Grade
Assessor’s Name
Feedback by Faculty , if any
 Question & Answers 1

1. What is the inventory turnover ratio

Answer:5.0
The initial inventory turnover ratio for the particular year: 4 
Therefore, in Step 1 the average inventory for the year is calculated by using the particular
formula outlined below: 
Average Inventory = (Beginning Inventory + Ending Inventory) / 2 (Furhmann, 2022)
Average Inventory = ($100,000 + $110,000) / 2 
Average Inventory = $105,000 
 
  Step two: As shown in the formula below it is possible to calculate the inventory turnover ratio
for the year.
 Inventory Turnover Ratio = Cost of Goods Sold / Average Inventory 
 
Inventory Turnover Ratio = $525,000 / $105,000 
Inventory Turnover Ratio = 5 
 
Therefore, the annual inventory turnover ratio for the business is 5. Thus the business was able to
sell as well as replace its inventory 5 times in the scenario year.          
1. The accounts receivable turnover ratio for the year was 
6.3
7.5
                                  
10.0
Answer 10.0
The formula for the accounts receivable turnover ratio is:
Accounts Receivable Turnover Ratio = Net Credit Sales / Average Accounts Receivable
(Furhmann, 2022)
Net Credit Sales = $830,000 zero Returns and Allowances = 0 (since no information is provided
about returns or allowances) 
the Initial Accounts Receivable = $80,000 Closing Accounts Receivable = $86,000
Average Accounts Receivable = (Initial Accounts Receivable + Closing Accounts Receivable) /
2 = ($80,000 + $86,000) / 2 = $83,000
Therefore, the accounts receivable turnover ratio can be calculated as:
Accounts Receivable Turnover Ratio = Net Credit Sales / Average Accounts Receivable =
$830,000 / $83,000 = 10
Therefore, the accounts receivable turnover ratio for the company is 10.

2. On average how many days of sales were in Accounts Receivable during the year?
27
 
37
 
49
Answer:37
     Average Collection Period = 365 / Accounts Receivable Turnover Ratio
(Kenton, 2023)
Where:
365 represents the annual days
The accounts Receivable Turnover Ratio is the ratio we calculated earlier.
Using the information, we calculated In part 1 above:
Accounts Receivable Turnover Ratio = 10
Therefore, the average collection period can be calculated as:
Average Collection Period = 365 / Accounts Receivable Turnover Ratio = 365 / 10 = 36.5
Approximately 37 days
Averagely, it took the business close to 37 days when you round off to the nearest day to receive
their debts in that particular year. 
 
3. On average how many days of sales were in Inventory during the year?
14
 
46
 
73
Answer:73 days
Average Days in Inventory = 365 / Inventory Turnover Ratio(Will,2022) = 365 / 5 = 73 days
Therefore, on average, the company had 73 days of sales in inventory during the year
 
 
 
 

Question 2:-
 
1. Which of the following will likely have the reported amounts on the balance sheet closest
to their current value?(5mks)
Current Assets Long-term Assets Stockholders' Equity
ANSWER: Current Assets
. 

 Liquidation of current assets is essential within one year, and the other amounts may more
accurately reflect present value than liquid assets or stock (Carlon, 2018).

On the balance sheet, for instance, cash and cash equivalents are reported at their present value,
and the amounts reported may be very close to this value. This is because bank statements or
other documents can easily be used to determine their value. A net realizable value is also
reported for accounts receivable. This is the amount expected to be collected from customers,
and the reported amount may be more accurate than illiquid assets or equity to reflect the present
value.

Due to changes in market conditions or normal wear and tear over time, long-term assets,
including property, plant, and equipment, may report numbers that are materially different from
their present worth. Equity is a company's leftover assets after subtracting its liabilities; it is not
expected to reflect current worth similarly to current assets (Carlon, 2018). Hence, the amount of
current assets listed on the balance sheet is probably the amount that most closely corresponds to
its current value
 
 
 

Question 3 and Answers

For each of the transaction scenarios below, write the appropriate journal entries in the Books of
Account of Run for Joy Pty Ltd. You will need to state the appropriate name of the account and
determine the debit and credit amounts. (25 mks)

1. Run for Joy Pty Ltd. purchased a motor vehicle with

$5000 cash and $15,000 on bank loan.

Account: Dr Cr
Cash $20,000 $5000
Bank Loan(Borrowed from bank) $15,000
Motor Vehicle $20,000

It can be observed that cash increased by $15000 while bank loans which is a liability rose by
the same value. Therefore, we debit the cash account by that amount and remember we had
initially $5000 cash at hand. The motor vehicle liability for the company will now be $20000
thus we credit the motor vehicle account.

2. The charge for the year for depreciation on Office Equipment owned by Run for
Joy was calculated to be
$4,000.
Account: Dr Cr
Office equipment- Depreciation expense $4000
Accumulated depreciation $4000

It can be observed that accumulated depreciation decreased by $4000 while office equipment
increased by $4000; the asset Accumulated depreciation decreased by $4000. Therefore, we
debit the office equipment depreciation expense account then we credit the accumulated
depreciation account.
3. ross salaries for January 1999 for Run for Joy Inc. totaled $6,000.
$5,000 was paid in cash to employees and $1,000 was deducted for PAYG Tax to
be paid at the end of the quarter.
Answer

Account: Dr Cr
Cash $5,000
 Answer:

P.A.Y.G tax $1000

Salaries Expense $6000

We credit the cash account with $5000 as a result of its decrease, the salaries expense account is
debited as the company has to pay both the tax and salary resulting in its increase.
 

Question & Answers for 4: -

Typical Sport and Recreation Expenditure The purpose of this exercise is to familiarize the
learner with typical types of expenditure that occur in a sport and recreation organization. Your
task is to match the typical expenditures in Table A with the scenarios in Table B.(25mks)

Table B:Sports and Recreation

Scenarios Put the Letter of the

appropriate group in this
column

1. Come n’ try promotional A

event
2. Junior football carnival B

3. Fundraising campaign C

4. General administration of D
the organization

5. Running costs of E
the clubhouse
 6. Indoor basketball clinic G
for coaches

7. Facility maintenance E
costs (outdoor)

8. Taking a team to a F
national championships

Explanations to answers above

Scenario 1: The Come n' Try promotional event is a marketing tactic for a sports and recreation
firm; as a result, the company will incur costs that can be categorized in Group A, which are the
costs associated with running the business.
Scenario 2: Junior football carnival is classified as a specific event that will make the sporting
facility incur one-off costs, including hosting the carnival. The costs will include buying trophies
and paying extra umpires and referees during the event days; all these are in Group B above.

Scenario 3: Fundraising campaign expenditures will include posting an advert in the dailies and
printing tickets for the same that will be sold in the event. These are some of the associated
expenditures drawn from Group C. 
      
Scenario 4: General administration of the organization is classified as recurrent expenses for the
company(CFI,2023). These expenses are necessary and compulsory for an organization to run
daily. Group D components in table A above contain all recurrent expenditures, including
salaries. 
                                            

Scenario 5: Running costs of the clubhouse are cost that are extra costs that are incurred on a
daily as part of the larger facility. A clubhouse is not the company's primary revenue source but
only an annexure and a source of extra income for the facility. Expenses are included in the
general components outlined in Group E of Table A above.

Scenario 6: Indoor basketball clinics for coaches are periodic expenses that are not done as daily
activities of the sporting facility. Therefore, this can be included in Group G with periodic
expenses such as air tickets and team apparel purchased after assuming annually. 

Scenario 7: Facility maintenance costs (outdoor) are the same as those outlined in Scenario 6
above.

Scenario 8: Taking a team to a national championship are expenses like those outlined in
Scenario(s) 7 and 8. National championships are periodic expenses.
 Question 5: -
The following is the adjusted trial balance of Maggie’s Music
Shop. (25mks)

Maggie's Music Shop Adjusted Trial Balance

January 31, 2019
Accounts Debits Credits
Cash 14,320
Office Supplies 1,900
Prepaid Rent 1,030
Equipment 52,070
Accumulated Depreciation--Equipment 5,620
Accounts Payable 4,400
Salaries Payable 260
Unearned Revenue 4,530
Notes Payable (long-term) 4,740
Maggie Graph, Capital 39,570 Maggie Graph,
Drawing 830
Service Revenue 17,430
Salaries Expense 3,640
Rent Expense 1,460
Supplies Expense 160
Depreciation Expense--Equipment 420
Utilities Expense 720
Total 76,550 76,550

Prepare an Income statement and Balance Sheet

` Answer

Income Statement for Maggie's Music Shop for the period ending January 31, 2019
Revenue:
Service Revenue $17,430

Expenses:
Salaries Expense $3,640
Rent Expense $1,460
Supplies Expense $160
Depreciation Expense--Equipment $420
Utilities Expense $720
Total Expenses $6,400

Net Income $11,030

Balance Sheet for Maggie's Music Shop as at January 31, 2019

Assets:
Cash $14,320
Office Supplies $1,900
Prepaid Rent $1,030
Equipment $52,070
Less: Accumulated Depreciation $5,620
Total Assets $63,700

Liabilities:
Accounts Payable $4,400
Salaries Payable $260
Unearned Revenue $4,530
Notes Payable (long-term) $4,740
Total Liabilities $14,930

Owner's Equity:
Maggie Graph, Capital $39,570
Less: Maggie Graph, Drawing $ 830
Total Owner's Equity $38,740

Total Liabilities and Owner's Equity $63,700

Explanation to the answer above

According to (Fernando,2022), a legitimate statement of income should list all the income from
either sales or service revenue of the business, the costs, and expenses accrued by the business.
After that, the Net income will be Total Revenue minus Total Expenses. The above income
statement for Maggie Music Shop has met all these requirements outlined in the above
statement. A comprehensive Balance sheet, on the other hand, outlines the company’s current
and non-current assets as well as liabilities and, finally, Debt and equity
 BIBLIOGRAPHY
Please list down the names of the text books, journals and websites that you referred
to do this assignment.

CARLON, S. (2018). chapter 9 . In Financial Accounting: Reporting, analysis and Decision

Making, 6th edition hybrid. essay, JOHN WILEY.
Carlon, S., McAlpine-Mladenovic, R., Lee, C., Mitrione, L., Kirk, N., & Wong, L.
(2019). Financial accounting: Reporting, analysis and decision making. John Wiley and
Sons Australia.

Fernando, J. (2022, November 3). Balance sheet: Explanation, components, and examples.
Investopedia. Retrieved March 5, 2023, from
https://www.investopedia.com/terms/b/balancesheet.asp

Furhmann, R. (2022, July 13). Know accounts receivable and inventory turnover. Investopedia.
Retrieved March 5, 2023, from
https://www.investopedia.com/articles/personal-finance/081215/know-accounts-
receivable-inventory-turnover.asp

Kenton, W. (2023, January 28). Average collection period formula, how it works, example.
Investopedia. Retrieved March 5, 2023, from
https://www.investopedia.com/terms/a/average_collection_period.asp