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The following analysis of the cash transactions for the year was gathered from the incomplete records of N. Carroll, a merchant:Receipts: Received from sundry debtors 300 000 Additional investment of capital 45 000 Payments: Payments to sundry creditors 185 000 General expenses 50 000 Wages 77 500 Drawings 95 000 1 Jan. 31 Dec. Balances: R R Bank overdraft 37 000 – Debtors 265 000 440 000 Creditors 75 000 97 500 Stock 85 000 95 000 Plant and machinery 100 000 100 000 Furniture and fittings 7 000 7 000Additional information: Provision must be made for: 1. Depreciation: 10% p.a. on plant and machinery (straight-line) 5% p.a. on furniture and fittings (straight-line) 2. Bad debts provision: 5% p.a. on sundry debtors Required (a) Draw up the income statement of N. Carroll for the year ended 31 December 2000. (b) Prepare the balance sheet of N. Carroll at 31 December 2000.
The following account balances are taken from the books of Country Club on 31 December 2017. Revenues and expenses are for the year ended 31 December 2017. The retained profits balance is as at 1 January 2017. Account Value ($) Accounts Receivable 29806 Accounts Payable 25280 Promotional Expense 54742 Cash 5028.2 Food Sales 15611 Cost of food sold 13798 Dividend payments 8209 Electricity Expense 6432 Furniture and fittings 42,500 Inventory 22,500 Land and buildings 75,000 Bank loan payable 43,750 Equipment 51,250 Rent expense 40546 Retained profits (1 January 2017) 74022 Share capital 75,000 Membership revenue 103263 Calculate the retained earnings for the year ended 31 December 2017.
Henry purchased equipment with a cost of $225557 on 1 July 2016. The equipment has an estimated life of 10 years or 108389 units of product. The estimated residual value is $27202. During 2016/17, 14633 units of product were produced with this machinery. Calculate the amount of total accumulated depreciation at 30 June 2017, using units-of-activity depreciation
The balance sheet of a sole trader revealed the following position. Fixed Assets Land and buildings R 9 170 R Equipment at cost less depreciation 15 570 Goodwill at cost less amounts written off 10 250 34 990 Investment in shares at cost 2 200 Current Assets R R Trading stock 45 840 Sundry debtors less bad debts written off 19 350 Cash at bank 10 920 76 110 113 300 = A Less: Current Liabilities R Sundry creditors and accruals 77 600 = L 35 700 Owner's Interest R R Capital 28 400 Profit for the year 7 300 35 700 = 0 Required Answer the following questions: (a) Are the assets correctly classified? If not, re-arrange them and give your reasons for doing this. (b) What is the current ratio? Is it satisfactory? (c) What is the acid-test ratio? Is it satisfactory? (d) Is the business solvent? Give your reasons. (e) Is the business overtrading? Give your reasons. (f) What is the profitability ratio of the business?
You have been requested by the shareholders to prepare a detailed report analysing the financial performance and financial position of COPPERBELT ENERGY CORPORATION PLC for the year ended 31st December 2018. The Annual Report and Accounts for Copperbelt Energy Corporation Plc are on the website(https://cecinvestor.com/cec-2018-annual-report-erratum/). REQUIRED: Prepare a REPORT to the shareholders providing a detailed analysis of the Financial performance and Financial Position of CEC company based on the ratios calculated and any other relevant information from the Annual Report:
BIT Bank (in millions) Assets: Reserves $48 Loans $360 Liabilities: Deposits $340 Bank Capital $68 NAT Bank (in millions) Assets Reserves $48 Loans $360 Liabilities Deposits $400 Bank Capital $8 Assume that both BIT Bank and NAT Bank have the same net profit after tax of $8 million a. Which bank (Bank BIT or Bank NAT) is riskier in case of loan depreciation at $60 million? Explain. Show your calculations to explain your answers. Expert's answer
BIT Bank (in millions) Assets: Reserves $48 Loans $360 Liabilities: Deposits $340 Bank Capital $68 NAT Bank (in millions) Assets Reserves $48 Loans $360 Liabilities Deposits $400 Bank Capital $8 Assume that both BIT Bank and NAT Bank have the same net profit after tax of $8 million a. Which bank (Bank BIT or Bank NAT) is riskier in case of loan depreciation at $60 million? Explain. Show your calculations to explain your answers.
Question 2 The following details appeared in the final accounts of a sole trader's business. Current assets R 8 400 Current liabilities 4 000 Gross profit 5 000 Net profit 2 400 Purchases 16 000 Sales 21 000 Capital 30 000 The opening and closing stocks, being identical figures, are not shown. Required Answer the following questions: (a) What is the ratio between current assets and current liabilities, and is it a satisfactory one? (b) What is the percentage gross profit on turnover? (c) What is the average mark-up percentage on purchases? (d) What is the capital yield to the owner expressed as a percentage? (e) Would the owner do better by investing his capital in a building society at 2 7 1 % per annum? (15)
The Annual Report and Accounts for Copperbelt Energy Corporation Plc are on the website(https://cecinvestor.com/cec-2018-annual-report-erratum/). e) Calculate the following ratios for 2018 and 2017: Liquidity Ratios: - Current ratio - Cash Ratio - Acid test ratio Profitability: - Gross Profit % - Operating profit % Investment ratios: - Return on Total Assets(ROA) based on the formula Profit before tax/Revenue - Return on Equity(ROE) based on the formula Profit before tax/Total Equity Efficiency ratios: Debtor collection period/debtors days Stock days Creditor payment period/creditor days Financing/capital structure: • Interest Cover Ratio • Total liabilities to Total Equity Ratio
4. Amal Automotive Company experienced the following accounting events during 2019. Received S60,000 cash from the issue of common stock. Performed services for $35,000 cash. Purchase land for $16,000 cash. Borrowed $1,000 cash from the Bank. Paid $24,000 cash for salary expenses. Sold land for $19,000 cash. Paid $20,000 cash on the loan from state bank. Paid $12,800 cash for salary expense. Paid a cash dividend of $15,000 to the stockholders Required: a. Pass general journal entries and post the entries, to T-accounts and determine the ending balance in each account. b. Prepare a statement of cash flows. Assume Amal Automotive had a beginning cash balance of $10,000.
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