Week+11 - FINANCIAL ACCOUNTING(ACC1006S SUGGESTED SOLUTIONS...

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FINANCIAL ACCOUNTING (ACC1006S) SUGGESTED SOLUTIONS TUTORIALS HANDED IN ON 19 OCTOBER 2009 TUTORIAL 25 (solution): Adj B 004 1. Salaries and wages expense 2003 1 July Prepaid salaries and wages expense 6 000 2004 30June Profit and loss 29 300 ½ 2004 30June Bank 22 000 Accrued salaries and wages expense (250 x 130/100 x 4) 1 300 ½ 29 300 29 300 2. 2.1 7 300 – 2 920 = 4 380 2.2 104 000 – 36 000 + 48 000 = 116 000 OR 104 000 + 12 000  2.3 (55 000 x 2/12 x8% ) + (70 000 x 10/12 x8% ) = 5 400 3. Statement of financial position of Africa Alive as at 30 June 2004 3.1 Current liabilities ½ Accrued advertising expense ½ 12 000 3.2 Current assets ½ Accrued interest income ½ 467 (5 400 - 4 933) 4. Loan (L) 1 July 2003 Bank 50 000 1 July 2003 Balance b/d 300 000 1 Jan 2004 Bank 50 000 30 June 2004 Balance c/d ½ 200 000 300 000 300 000 1 July 2004 Balance b/d 200 000 450 000/9 = 50 000 per payment ½ Interest expense 1 July 2003 Bank [W1] 8 250 1 July 2003 Accrued interest expense [W1] 8 250 1 Oct 2003 Bank [W2] 6 875 30 June 2004 Profit and loss [W6] 24 750 1 Jan 2004 Bank [W3] 6 875 1 April 2004 Bank [W4] 5 500 30 June 2004 Accrued interest expense [w5] 5 500 for dates 33 000 33 000 W1. 1 July 2003 300 000 x 11% x 3/12 = 8 250 W2. 1 Oct 2003 250 000 x 11% x 3/12 = 6 875 W3. 1 Jan 2004 250 000 x 11% x 3/12 = 6 875 W4. 1 April 2004 200 000 x 11% x 3/12 = 5 500 W5. 30 June 2004 200 000 x 11% x 3/12 = 5 500  Page 1 of 6
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W6. 250 000 x 11% x 6/12] + [200 000 x 11% x 6/12] Accrued Interest expense 2003 1 July Interest expense 8 250 2003 1 July Balance b/d ½ 8 250 2004 30 June Balance c/d ½ 5 500 2004 30 June Interest expense 5 500 13 750 13 750 2004 July 1 Balance b/d 5 500 5. 165 000 x 20% = 33 000 ½ 160 000 x 9/12 x 20% = 24 000 DR Depreciation expense ½ 57 000 CR Accumulated depreciation on vehicle (-A) 57 000 6. 6.1 Cost = 325 000 (165 000 + 160 000) Acc Depr = 123 000  (24 000 + (33 000x3)) Carrying value= 202 000 6.2 Depreciation is the systematic allocation of the depreciable amount of the asset over its estimated useful life 7. DR Bad debts expense 32 000 CR Trade receivables (A) 32 000 DR Allowance for doubtful debts (-A) 25 000 CR Trade receivables (A) 25 000 amounts correct 8.
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