UKAF 1033 Business Accounting 1

Jan 2011

Tutorial 1
1.

2. Accounting equation
Assets = Capital + Liabilities
AL=C
-

depicts the relationship between assets, liabilities and owners equity.

shows the financial position of a business entity at a particular date.
can be presented in the form of balance sheet.
the total of one part is always equal to the total of the other part.
Statement of Financial Position as at XXX
Assets

Liabilities

Capital

3.

4.Fatimah

UKAF 1033 Business Accounting 1

Jan 2011

5. Johari

6.Kok Heng

Tutorial 2
Q.1
Debited

Credited

Debited

Credited

(a) Lorry
(c) Loan from
(e) Machinery
(g) Bank
(i) Cash

Cash
Cash
Amal
Siva
Bala

(b) Siti
(d) Cash
(f) Cash
(h) Bank
(j) Lam

Bank
Van
Ho
Capital
Cash

UKAF 1033 Business Accounting 1

Q.2
Date
Mar 1

Mar 2

Mar 3

Mar 5

Mar 8

Mar 15

Mar 17

Mar 24

Mar 31

Q.3

Jan 2011

Particulars
Dr Cash
Dr Bank
Cr Capital

Dr
750
9,000

Dr Bank
Cr Dala (Loan creditor)

2,000

Dr Equipment (Computer)
Cr Cash

600

Dr Equipment (display equipment)

Cr Chin Enterprise

420

Dr Cash
Cr Bank

200

Dr Dala
Cr Bank

500

Dr Chin Enterprise
Cr Bank

420

Dr Dala
Cr Cash

250

Dr Equipment (Printer)
Cr Lim

200

Cr

9,750

2,000

600

420

200

500

420

250

200

Fendy

1
24
28

Capital
Wong
Biz rates

28

bank

28

bank

10
28

returns out
bank

11000
250
45

830

6100

195
415

Bank
5 Stationery
16 biz rates
19 rent
28 ben
28 mardi
28 betty

62
970
75
830
415
6100

Ben
2 Purchases

830

betty
20 motor vehi

6100

mardi
2 purchases

610

capital

1600

Cash
3 purchases
4 rent
7 wages
11 rent
18 insurance
21 motor exp
23 wages

370
75
160
75
280
24
170

Sales
6 tam
6 husin
6 wong
15 lee
15 sharee
15 rashid

370
290
410
205
280
426

UKAF 1033 Business Accounting 1

lam
2 purchases

Jan 2011

13

husin

590
Returns outwards
10 mardi

tam
6

Sales

Returns Inwards
35

195

370
rent

sales

290

husin
13 returns in

4
11
19

cash
cash
cash

Sales

410

wong
24 bank

16

Bank

biz rates
970 28 bank

sharee

7
23

cash
cash

wages
160
170

rashid

Bank

stationery
62

18

cash

insurance
280

21

cash

motor exp
24

20

betty

35

250

75
75
75

45

lee
15

15

15

sales

Sales

sales

205

280

426
Capital
1 Bank
1 cash

2
2
2
3

ben
mardi
lam
cash

purchases
830
610
590
370

11000
1600

motor vehicle
6100

Tutorial 3
1. Joe Trading

UKAF 1033 Business Accounting 1

Jan 2011

2. Kim

3. Gary

UKAF 1033 Business Accounting 1

Jan 2011

4.

5. (a) Purpose of day books

- segregation of duties different bookeepers
- provides a means of internal control to prevent fraud
- facilitates the location of errors and ensuring accuracy of ledgers
(b) Sales day book: Invoice
Purchases day book: Suppliers Invoice
Sales return day book: Credit note
Purchases return day book: Debit note
Contents:- Date on which each transaction took place
- Name and contact information of the addressee
- Details or description relating to the sales/purchases/returns
transaction (e.g: name of the goods, no. of items).
- Folio column entry for cross referencing back to the original source
documents
- Monetary amounts of the goods
Tutorial 4
1.

UKAF 1033 Business Accounting 1

Jan 2011

2. Kedai Runcit Shaari

3. Purpose of trial balance

(a) to ascertain whether the total of the accounts with debit balances equals the
total of the accounts with credit balances (matching credit entry for every debit
entry).
(b) to prove arithmetic accuracy of the ledger accounts.
(c) to assist in the preparation of financial statements.

UKAF 1033 Business Accounting 1

Jan 2011

4.

UKAF 1033 Business Accounting 1

Jan 2011

Tutorial 5

1.

Trial Balance as at 31 Dec 2007

RM
Capital
Drawings
Loan- Public Bank
Leasehold premises
Motor vehicles
Investment
Trade debtors
Trade creditors
Cash
Bank overdraft
Sales
Purchases
Returns outwards
Returns inwards
Carriage
Wages and salaries
Rent and rates
Light and heat
Telephone and postage
Printing and stationery
Bank interest
Interest received

RM
39,980

14,760
20,000
52,500
13,650
4,980
2,630
1,910
460
3,620
81,640
49,870
960
840
390
5,610
1,420
710
540
230
140
148,730

620
148,730

UKAF 1033 Business Accounting 1

Jan 2011

2
.

10

UKAF 1033 Business Accounting 1

Jan 2011

Tutorial 6
1.
Balance b/d
Beh

2,740
201

Cash Book
Bank charges
Gina
Balance c/d

2,941

Bank Reconciliation statement as on 31 March 2008

Balance as per cash book
Add: Unpresented cheque
Less: Lodgements not yet credited
Balance as per bank statement

32
93
2816
2,941

2816
131
2947
410
2537

2.Hogan

11

UKAF 1033 Business Accounting 1

Jan 2011

3. Thomas Lee

4. King

12

UKAF 1033 Business Accounting 1

5. Han Chung Trading
(a)
Balance b/f
Receipts (15,073-47-18)

(b)

Jan 2011

Cash Book
RM
1,470 Payments (15,520+47)
15,008 Bank charges
Balance c/f
16,478

RM
15,567
35
876
16,478

Bank Reconciliation Statement as on 31 Oct 2007

RM
Balance as per cash book
Add
Unpresented cheques (214+370+30)
614
Less

Uncredited lodgements
Bank error in debiting account
Balance as per bank statement

1,542
72

RM
876
614
1,490
1,614
(124)

6. Factors causing the differences:(a) Timing differences

Uncredited lodgements and unpresented cheques
(b) Omissions and errors
Omissions of transactions such as bank charges, standing order, direct debit,
credit transfer, dishonoured cheque of third parties; and errors in cash book.

13

UKAF 1033 Business Accounting 1

Jan 2011

Tutorial 7
1.

2.

14

UKAF 1033 Business Accounting 1

Jan 2011

3.

15

UKAF 1033 Business Accounting 1

Jan 2011

4.

16

UKAF 1033 Business Accounting 1

Jan 2011

Tutorial 8
1.

2.

17

UKAF 1033 Business Accounting 1

Jan 2011

3.Didi

4.

(a)

Journal

Bank
Thong
(Being receipt of RM500 towards debt previously written off)
Thong
Bad debts recovered account
(Being reversal of debt previously written off)

Debit Credit
RM
RM
500
500

500
500

18

UKAF 1033 Business Accounting 1

(b)

(c)

Provision for doubtful debts

RM
Balance c/d
1,045
Balance b/d
(22,000-800-300)*5%
P+L
1,045

Jan 2011

RM
900
145
1,045

Balance Sheet as at 30 Nov 2007

RM
Current Asset
Trade Debtors (22,000-1,100)
Less: Provision for doubtful debts

20,900
1,045
19,855

5.

19

UKAF 1033 Business Accounting 1

Jan 2011

Tutorial 9
1. Hikmat Trading

20

UKAF 1033 Business Accounting 1

Jan 2011

2. Bakti Enterprise

3. Ori Sdn Bhd

2006
1-Jun
1-Jul
30-Sep
1-Oct
2007
1-Jan
1-Apr

1-Jun

Prepaid rent b/d

Bank- Q3
Bank- Rates
Bank- Q4
Bank- Q1
Bank- Q2
Accrual rates c/d
Prepaid b/d

Rent and Rates

RM
2006
200
1-Jun
600
2,040
600
750
750
380
5,320
250

Accrual rates b/d

31-May
31-May
31-May

P+L (Rates)
P+L (Rent)
Prepaid rent c/d

1-Jun

Accrual rates b/d

RM
340

2,080
2,650
250
5,320
380

Workings: P+L (Rent) = 7*200 (Jun-Dec'06) +

5*250 (Jan-May'07)
= 2,650
P+L (Rates) = 10*170 (Jun'06-Mar'07) +
2*190 (Apr'07-May'07)
= 2,080
b) Matching principles refers to the assumption that in the measurement of profit,
costs should be set against the revenue which they generate at the point in time
when this arises.
In this case, the rent and rates expenses are matched according to the
accounting period. Expenses give rise to certain effects which take the form of
revenue. Matching is thus the determination of profit by attributing specific
causes to particular effects at the point in time at which the effects occur.

21

UKAF 1033 Business Accounting 1

Jan 2011

Tutorial 10
1. Soon
Statement of Comprehensive Income for the year ended 31 Dec 2008
RM
Sales (1000+250+8+3-200)
Less: Cost of sales
Opening stock
Purchases (700+160-180)

200
680
880
230

less: Closing stock

Gross profit
Less: Expenditure
Rent (8+30-10)
Insurance (12+20+6)
Electricity (25+7-9)
Telephone (10-2-1)
Wages
Discounts allowed
Bad debts written off
Depreciation

28
38
23
7
100
8
3
50

Statement of Financial Position as at 31 Dec 2008

RM
RM
Fixed assets (350-50)
Current Assets
Trade debtors
Stock
Bank (20+1000-700-185-50)
Prepayments (10+2)

Less: Current Liabilities

Accruals (7+6)
Trade creditors
Net current assets
Capital
Balance as at 1 Jan 2008
Add: Net profit
Less: Drawings

RM
1,061

650
411

257
154

RM
300

250
230
85
12
577

13
160

173
404
704
600
154
754
50
704

22

UKAF 1033 Business Accounting 1

Jan 2011

2.

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UKAF 1033 Business Accounting 1

Jan 2011

Tutorial 11
1.

2.

3.

24

UKAF 1033 Business Accounting 1

Jan 2011

4. Types of error that do not affect the trial balance agreement

(a) Error of omission
A transaction is completely omitted from the books.
(b) Error of principle
An entry is made in the wrong class of account.
(c) Error of commission
An entry is posted to the wrong persons account.
(d) Error of original entry
The double entry principle is correct but error occurs in the original documents
where the figure is incorrect.
(e) Complete reversal of entry
An account that should be credited is debited and vice versa.
(f) Compensating error
Errors occur and cancel each other out.

Tutorial 12
1. Regent Sdn Bhd
a)
i) Bank Charges
Cash

RM
56

56

ii) Creditors control

Purchases

400

iii) Debtors control

Sales

100

400

100

iv) Creditors control/ Amin Trading

Purchases

90

v) Bad debts
Debtors control/ Shanie

88

vi) Motor expenses

Motor Vehicle
vii) Accumulated Depreciation
Depreciation

RM

90

88
550
550
55
55

25

UKAF 1033 Business Accounting 1

b)

Jan 2011

Statement of Corrected Net Profit for the year ended 31 May 2008
RM
Net profit as per draft final account
305,660
Add: Purchases overcast
400
Sales undercast
100
Error in purchases journal
90
Wrongly accounted depreciation
55
645
Less: Bank charges
Bad debts
Repair and maintenance

56
88
550

694
305,611

2.

3. Gail Dawson

26

UKAF 1033 Business Accounting 1

Jan 2011

Tutorial 13
1.

2.

27

UKAF 1033 Business Accounting 1

Jan 2011

3.

4.

Balance b/d
Sales
Cash
Interest on overdue account
Balance c/d

Balance b/d

Debtors' Ledger Control

RM
7,182 Cash
69,104 Discounts allowed
66 Returns inwards
10 Bills receivable
42 Bad debts
Creditors ledger control
Balance c/d
76,404

RM
59,129
1,846
983
3,243
593
303
10,307
76,404

10,307

5. Purpose of Control Accounts

- to provide a check on the accuracy of the ledger
- to facilitate the location of erros higlighted in the trial balance by pinpointing
the personal ledger
- deter fraud and ensure proper segregation of duties
- facilitate the extraction of balances on creditors and debtors, whereby
information is obtained immediately from control accounts

28

UKAF 1033 Business Accounting 1

Jan 2011

Tutorial 14
1. Balan

2. Othman

29

UKAF 1033 Business Accounting 1

Jan 2011

3. Amal

Sales

Statement of Comprehensive Income for the year ended 31 May 2008

RM
RM
405,000

Less: Cost of sales

Opening stock
Purchases (259,600-1,040)
less: Closing stock
Gross profit
Add: Discounts received
Reduction in provision of doubtful debts ([0.5%*46,200]-280)
Less: Expenditure
Discounts allowed
Wages and salaries (52,360+140)
Bad debts
Loan interest
Carriage outwards
Other operating expenses (38,800-500+200)
Depreciation on property (90,000*1%)
Depreciation on equipment (57,500*15%)

27,400
258,560
285,960
25,900

260,060
144,940
4,420
49
149,409

3,370
52,500
1,720
1,560
5,310
38,500
900
8,625
112,485
36,924

Net profit

Statement of Financial Position as at 31 May 2008

RM
RM
Cost
Acc. Depn
Fixed Assets
Property
Equipment

90,000
57,500

Current Assets
Stock
Trade debtors
Less: Provision of bad debts
Cash on hand
Prepayment

46,200
231

Less: Current Liabilities

Bank overdraft
Accruals (140+200)
Trade creditors
Net current assets

14,500
340
33,600

13,400
41,125

RM
NBV
76,600
16,375
92,975

25,900
45,969
151
500
72,520

48,440
24,080
117,055
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UKAF 1033 Business Accounting 1

Jan 2011

Less: Long term liability

13% loan
Net assets

12,000
105,055

Capital
Balance at 1 June 2007
Add: Net profit

98,101
36,924
135,025
29,970
105,055

Less: Drawings (28,930+1,040)

4. Tim

Sales

Statement of Comprehensive Income for the year ended 30 Sep 2007

RM
RM
203,845

Less: Cost of sales

Opening stock
Purchases (167,760-112)
less: Closing stock
Gross profit
Add: Discounts received
Less: Expenditure
Rent (1,350+450)
Light and heat (475+136)
Insurance
Salaries
Stationery and printing
Telephone and postage
General Expenses (2,044+252)
Travellers commission and expenses (9,925+806)
Discounts allowed
Bad debts written off
Provision for doubtful debts
Depreciation on office furniture and equipment (1,440*10%)
Net profit

14,972
167,648
182,620
12,972

169,648
34,197
955
35,152

1,800
611
304
6,352
737
517
2,296
10,731
517
331
430
144
24,770
10,382

31

UKAF 1033 Business Accounting 1

Jan 2011

Statement of Financial Position as at 30 Sep 2007

RM
RM
Fixed Assets
Office furniture and equipment (1,440-144)
Current Assets
Stock
Debtors
Less: Provision of bad debts
Bank
Petty cash in hand
Less: Current Liabilities
Accruals (450+136+806+252)
Trade creditors
Net current assets

RM
1,296

12,972
19,100
573

1,644
8,162

18,527
6,603
29
38,131

9,806
28,325
29,621

Capital
Balance at 1 June 2007
Add: Net profit

24,239
10,382
34,621
5,000
29,621

Less: Drawings (4,888+112)

5.
Statement of Comprehensive Income for the year ended 31 Jan 2006
RM
RM
Sales (50,240-300)
Less: Return inwards
Less: Cost of sales
Opening stock
Purchases
less: Return outwards

13,630
42,400
348

less: Closing stock (15,450+240)

Gross profit
Add: Gain on sales of motor vehicle
Less: Expenditure
Salaries and wages
Rent, rates and insurance (860+36-60-10)
Sundry expenses (750+90)
Provision for doubtful debts (340-280)
Bad debts
Depreciation on fixtures and fittings (1400*10%+240*4/12*10%)
Depreciation on motor vehicles ([920-80]*25%)
Net profit

RM
49,940
136
49,804

42,052
55,682
15,690

39,992
9,812
40
9,852

4,100
826
840
60
134
148
210
6,318
3,534

32

UKAF 1033 Business Accounting 1

Jan 2011

Statement of Financial Position as at 31 Jan 2006

RM
Fixed Assets
Fixture and fittings
Motor Vehicle

1,640
840

Current Assets
Stock
Sundry debtors (4,610-300)
Less: Provision of bad debts
Prepayments (60+10)
Cash at bank and in hand

4,310
340

Less: Current Liabilities

Accruals (36+90)
Sundry creditors
Net current assets

126
3,852

Capital
Balance at 1 June 2007
Add: Net profit
Less: Drawings

RM

148
210

RM

1,492
630
2,122

15,690
3,970
70
3,820
23,550

3,978
19,572
21,694

20,760
3,534
24,294
2,600
21,694

Workings: Profit of 20% on sales price

x
100
=
240
80
x
=
RM300

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