Accounting 1B (ACCG101)
Revision Package 1
Semester 1, 2013
NOTE: This revision package includes practical questions on topics
covered from weeks 2 to 5 inclusive.
The mid semester exam will include both practical and theory questions.
Students are requir
Solutions to Week 6 Lecture Exercises
PROBLEM SET A 7.6
(a)
Dec.
31
Bad Debts Expense. 25,450
Allowance for Doubtful Debts .
($37,450 $12,000)
25,450
(a) & (b)
Bad Debts
Expense
Balance
Date
Particular
31/12/2016
Allowance for Doubtful Debt
Dr
Cr
$25,450
SIBT- ACST101
Lecture 2 Solutions
ACCUMULATED (FUTURE) VALUES
To find the accumulated value of a single payment, use the formula
S = P * (1+i) n
Example 2.1 :
Find the accumulated value at the end of 10 years if $5,000 is invested at 10% p.a.
compound int
ACST101
LECTURE 7 - SOLUTIONS
Suppose you want to take out a home loan. You might want to know facts such as:
a)
What will the repayments be?
b)
What will be the loan outstanding at any date (if say, you want to sell the house
and pay out the loan at that
SIBT - ACST101
Lecture 4 Solutions
AN ANNUITY is a set of payments made at regular intervals
e.g. rent paid once a week
e.g. car loan payments made once a month
e.g. home mortgage payments once a month
Accumulated value of an annuity:
R * sn at rate i
is
Sydney Institute of Business & Technology
ACST101 Elements and Techniques of Finance
Lecture 8 Solutions
A. FLAT RATE LOANS
In the past, some lenders would quote "flat interest rates" instead of effective
interest rates.
For a loan $P, borrowed for t year
SIBT
- ACST101
Lecture 9 Solutions
Example 9.1 :
A $1,000 bond pays interest at j4 = 12% and is redeemable at par
in 6 years.
(a) Calculate I and C.
I = face value * bond int. rate / frequency
= 1000 * .12 / 4
= 30 per quarter
C = face value = $1000
(beca
SIBT- ACST101
Lecture 12B Solutions
SINKING FUNDS
Example 12B.1:
Periodic expense
= interest only payments + sinking fund payment
L* i1
+
L / sn at rate i2.
= 200,000 * 0.12/4
= 6,000
= 8,967.25
+
200,000 / s40 at rate 2.5%
+
2,967.25
Example 12B.2:
A com
ACST101
Lecture 11 Solutions
Example 11.1
The first payment is $50 and increases are $50, so we can use the formula for an
increasing annuity where:
R = 50
n = 10 annual payments
i = 0.06
PV = $50 * (1.06) a10 - 10 * (1.06) -10
0.06
= $1,848.12
Example 11
SIBT
- ACST101
Lecture 10 Solutions
Example 10.1 :
A $100 bond pays interest at j4 = 12% and is redeemable at par in
3 years. If the bond is bought for $108:
(a) Create an equation of value that could be used to find i, the
yield to maturity.
I = 100 * .1
SIBT- ACST101
Lecture 12A Solutions
CAPITALISED COSTS
Example 12A.1:
Initial Price
C
Maintenance cost p.a. M
Scrap value
S
Time until trade in needed
K=
Machine A
10,000
2,000
1,000
10 years
Machine B
14,000
15,000
2,000
12 years
C + M + (C S)
i
(1 + i)n
SIBT - ACST101
Lecture 6 Solutions
FINDING THE TERM OF AN ANNUITY
1. We know Accum = R sn at i
Given the Accum, R, and i, -> find n
2. We know PV = R an at i
Given the PV, R, and i, -> find n
To do this we will need to use logarithms
Example 6.1 :
A loan
SIBT - ACST101
Lecture 5 Solutions
We now have two formulas for annuities
Accumulation formula:
R sn at i = R * [ (1+i) n 1]
i
Present Value formula:
R an at i = R * [ 1- (1+i) -n ]
i
We can solve many different problems:
Given R, n, i -> find PV
Given
SIBT - ACST101
Lecture 3 Solutions
We are still working with the compound interest formula
S = P * (1+i) n
So far we have solved 2 types of problem:
Given P, i, and n -> find S, the accumulated value.
Given S, i, and n -> find P, the PV
Now we have 2 more
SIBT - ACST101
Lecture 1
Solutions to Lecture Examples
SIMPLE INTEREST
EXAMPLE 1.1:
$8000 is borrowed on May 10 and repaid on September 15. Simple interest is charged
at 6% p.a.
(a) Calculate the term (number of days) of the loan.
How many days from May 1
ACCG 101 Tutorial Solutions (Week 3)
CHAPTER 1
Q10.
The going concern principle lends credibility to the cost principle; otherwise items would be
reported at liquidation value. By assuming the entity will continue to operate, assets can
continue to be rep
Accounting for retailing and inventory I
Week 8
Learning objectives
1. Nature of inventory and retailing operations
Periodic inventory system
2. Prepare journal entries for retail businesses under the periodic
inventory system
3. Prepare a detailed income
Solution to Week 2 Lecture Exercises
Questions 1-6 multiple choice questions: D A A B C D
Question 7 PROBLEM SET A 3.6
(a)
Characters Ltd
General Journal
Date Account name (narration)
2017
June 30 Insurance Expense
Prepaid Insurance
Post Ref
Debit $
505
1
GST IN PRACTICE: Illustrative example
Record the general journal entries for the following June 2015
transactions for City Management Services:
1. Jane Morris deposited $240 000 cash into an account opened for the
management services business
Dr Cash
240
Revision of accounting concepts and
principles and the accounting cycle
ACCG101 Week 2
1
Revision
Accounting concepts and principles
The accounting cycle
2
Concepts and principles
Monetary principle:
Items included in accounting records must be able to
Accounting for inventory and inventory II
Week 9
Learning objectives
Last week we looked at the Periodic inventory system this week we move to the
Perpetual inventory system
1 Prepare journal entries and income statement for retail
businesses under the pe
Tutorial Questions for Week 1 Lecture Topic
Q1 Discussion question
What are some of the financial decisions owners need to make when running a new business?
Q2 Discussion question
There are diverse roles of accountants. Which role(s) would you like to hav
ACCG 101 Sample Exam Paper
S1 2016
Disclaimer
The objective of the sample examination and the revision materials therein is to assist
students in their preparation for the final examination. The sample examination is
therefore similar in format and struct