exam pack from 2015 to 2017.pdf

8 28 february 209 120000 24000 x 20 19200 01

Info icon This preview shows pages 112–119. Sign up to view the full content.

01 March 20.8 - 28 February 20.9 (120000 - 24000) x 20% = 19200 01 September 2008 equipment 01 September 20.8 – 28 February 20.9 30 000 x 20% x 6 12 = 3000 46200 (a) Depreciation on new equipment 57000 x 20% x 8 12 = 0 7600 (b) Depreciation sold equipment 01 March 20.7 - 28 February 20.8 24000x 20% = 4800 01 March 20.8 - 28 February 20.9 (24000-4800 x 20%) = 3840 01 March 20.9 - 01 June 20.9 (24000 - 4800-3840) x 20% x 3 12 = 768 (c) Depreciation on remaining old equipment (150000 – 24000) – (46200 – 4800-3840) x 20% = 17688 91 | P a g e
Image of page 112

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

FAC1502 2014 NOTES (a) The cost at the beginning of the period is made up of the cost of all those assets bought prior to the current period. (b) The costs of installation of the equipment should be debited in the equipment at cost account. In terms of International Accounting Standard (IAS16) all the costs of putting the non-current asset into the state required for use by management are to be added to the cost of the asset. (c) Depreciation on the sold equipment will be provided from the beginning of the period up to the date of sale (01 March 2009 – 30 May 2009). It will not be depreciated for June as it was disposed of on the first day of the month. (d) When calculating the depreciation on the remaining old equipment, we first subtract the accumulated depreciation of the asset sold from the depreciation of the old asset prior to this year. (e) Upon disposal, all the depreciation that had been provided on the disposed of asset from its date of purchase should be eliminated from the books of accounts by debiting the Accumulated Depreciation Account and crediting the Realisation Account. 92 | P a g e
Image of page 113
FAC1502 2014 OCTOBER – NOVEMBER 2011 93 | P a g e
Image of page 114

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

FAC1502 2014 94 | P a g e
Image of page 115
FAC1502 2014 95 | P a g e
Image of page 116

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

FAC1502 2014 SOLUTION 1: CLOSING ENTRIES XYZ TRADERS GENERAL JOURNAL 1.1 Trading inventory bought into a/c DEBIT CEDIT Inventory : Trading (closing ) 14885 Trading account 14885 1.2Closing Entries Sales 553 Settlement discount granted 553 Settlement discount received 155 Purchases 155 Trading acc 156723 Carriage on purchases 660 Purchases 154725 Sales returns 1338 Sales 255847 Purchases returns 245 Trading acc 256092 Trading acc 100704 Profit or loss 100704 Profit or Loss 82519 Credit loss 244 Depreciation 15400 Insurance 2400 Packing materials 3300 Wages 56775 Water and electricity 4400 Commission income 15000 Rent income 3600 Profit or loss 18600 Profit or loss 36785 capital 36785 capitals 2445 drawings 2445 96 | P a g e
Image of page 117
FAC1502 2014 1.3 XYZ TRADERS GENERAL LEDGER Trading Account June 30 Inventory 13550 Inventory 14885 Carriage on purchases 660 Sales (256400 – 553) 255847 Purchases 9154880-155) 154725 Purchases returns 245 Sales returns 1338 Profit & loss (gross) 100704 270977 270977 Profit or loss account June 30 Credit loss 244 Trading account 100704 Depreciation Wages 15400 56775 Commission income 15000 Insurance 2400 Rent income 3600 Packing materials 3300 Water and electricity 4400 Capital (net profit) 36785 119304 119304 NOTES: CLOSING ENTRIES 1. (a) The closing entries are as follows: Opening stock: Dr Trading Account Cr Inventory (b) Closing Stock: Dr Inventory Cr Trading Account (2) The settlement discount granted account is closed off to the sales account as follows: Dr Sales Cr Settlement Discount Granted (3) The settlement discount received account is closed off to the purchases account as follows: Dr Settlement Discount Received Cr Purchases Account (4) Sales will be transferred to the Trading Account as follows: Dr
Image of page 118

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

Image of page 119
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern