ACCT 424 SEU Insurance Accounting Worksheet
Assignment Question(s):
Q1. The following financial transactions are related with a General Takaful Product:
i. An amount of SAR 6,200 received as advanced contribution from new participants.
ii. An amount of SAR 4,500 received as a contribution from new participants.
iii. Contribution renewal received from participants SAR 5,500.
You are required to prepare necessary journal entries. (1.5 Marks)
Answer:
Q2. Discuss the three primary methods used by Guaranty Fund to assess property and liability insurance using your own words. (2 Marks)
Answer:
Q3. XYZ Company has the following financial data: (1.5 marks)
|
Particulars |
Amounts (SAR) |
|
Total Profit for the Year |
377,500 |
|
General Takaful Assets (Year 2014) |
1,390,000 |
|
General Takaful Assets (Year 2015) |
1,517,500 |
|
Cash |
11,500 |
|
Short-term Investment |
23,500 |
|
Short term liabilities |
85,000 |
|
Underwriting Surplus Distributable to Participants/Participants’ Share of Profit |
145,500 |
|
Gross Contribution |
958,000 |
|
Net Contribution |
662,500 |
|
Wakalah Fee |
77,500 |
|
Commission Paid |
28,300 |
|
Management Expense |
58,000 |
|
Net Claim Incurred |
287,500 |
|
Earned Contribution |
632,500 |
You are required to calculate:
a)Return on Assets
b)Quick Liquidity
c)Surplus Distribution Ratio
d)Expense Ratio
e)Claims Ratio
Answer:
