Assignment 1 - Explanation and Calculation for transactions for Start AB

during December 2021

4.2 Transactions during December 2021

A4 - 18 December - Goods of SEK 65,000 sold on credit and invoiced and due on
18th January
A5 - 22 December - The customer has made a complaint and cash discount on
goods amounting to SEK 8,125
A8 - 23 December - Voucher ( Total cost of salary is SEK 18,000, from which net
value is SEK 12,600). Tax 30% 5,400 and national insurance is SEK 5,760
(assuming national insurance is 32%)
A9 - 30 December - Sale of goods amounting to SEK 7,500 has been incorrectly
recorded as paid, same is reversed and bank credit and account receivable debit.
A11 - 31 December - Travel expenses recorded as accrued expenses amounting to
SEK 18,750 paid

4.3 Closing transactions as of 31 December 2021

A12 - closing inventory calculated at AVCO method

Issue Average cost per unit of Number of units in Total value of

Date Received at d at inventory held inventory Inventory

2021

January 100 225 100 22500

February 120 232 120 27840

Subtotal 228.8 220 50340

March 92 “228.8 92

May 99 “228.8 99

Subtotal 228.8 29 6635.2

July 200 235 200 47000

Subtotal 234.2 229 53635.73

September 190 “234.2 190

Subtotal 234.2 39 9133.8

October 180 240 180 43200

Closing
inv. 219 52333.8

The average cost is as calculated in the above table.

A12 - Account receivable due from Svanen AB amounting to SEK 75,000, only 50%
of the amount due is expected to be paid. SEK 37,500 is recorded as Allowance for
doubtful debt and bad debt expense

A13 - Sales of SEK 93,960 has not been invoiced at the end of the year. Account
receivables increase and accrued revenue increase

A16 - Remaining loan value 223,400 +

Amortization SEK 6,300 = SEK 229,700
Interest 229,700 into 5% = SEK 11,485

Interest as accrued for 2021 223,400 into 5% into 3 months = SEK 2792
( assumption has been made that paid only upto 1 October)
Total interest SEK 11,485 + SEK 2792 = 14277

Interest 14,277 - open balance 11,484 = SEK 2793

A17 - Disposal of machine at profit

1. Posting original value of the machine SEK 100,000

Profit machine disposal Debit
Machine Credit
2. Accumulated Depreciation of machine of SEK 30,000 (100,000 10% into 3
years = SEK 30,000
Accumulated depreciation of machine Debit
Profit machine disposal Credit
3. Profit of disposal of machine SEK 5,000

A18 - Depreciation of equipment at straight-line method

Asset Depreciation @ 10%

cost Year of acquisition
 201
8 2019 2020 Accumulated Current year expense 2021

55,000 2019 - 5,500 5,500 11,000 5,500

69,000 2020 - - 6,900 6,900 6,900

205,000 2021 - - - - 20,500

329,000 - 5,500 12,400 17,900 32,900

A19 - Insurance premium annual is SEK 39,000 from period 01/07/2021 to

30/06/2022. SEK 19,500 is amount paid for this year and SEK 19500 for 2022 is
marked as accrued expense.

A20 - The company estimates to pay the auditors for auditing the company's
account, the amount is 24,000 SEK. Documented as accrued

A21 - When preparing this year’s financial statement it is discovered that last year’s
results have been forgotten, so the appropriate amount is found in the opening
balance and the double entry is made to the account 2098 debited with 28,800 SEK
and the account (2091) Retained profit is credited with 28,800 SEK.

A22 - To calculate the tax which is 20% we’ve to first find out what the profit for the
year 2021 is. We find this in the income statement (Revenue - Expenses = Profit)
The Profit is 350 528,80 SEK and 20% of that is 87 632,00 SEK.