Calendar and Distance Accounting Assignment - Accounting and Finance Assignment Help

Assignment Task

ACCOUNTING : ASSIGNMENT

QUESTION ONE

Samke Limited sells new equipment and repairs equipment for their regular customers. The following information was extracted from the accounting records for the financial year ended 30 June 2021

2. Adjustments and additional information:

The internal auditors have identified the following errors or omissions:

2.1 auditors are owed a further R28 000 in audit fees.

2.2 Bank charges of R310 reflected on the June 2021 bank statement have not yet been entered in the books.

2.3 The stock count on 30 June 2021 revealed the following on hand:

• Inventory: Trade goods; R202 000
• Consumable stores; R900

2.4 The tenant paid the July and August rent in June 2021. The rent was increased by R700 per month on 1 January 2021.

2.5 Provide for depreciation on machinery at 10% p.a. on the diminishing-balance method. Note that new machinery costing R30 000 was purchased on 31 December 2020, (this was recorded correctly).

2.6 Interest on the loan was capitalised. The loan statement from Finhouse on

30 June 2021 reflects the following:

The interest expense for the year has not yet been entered in the books.

2.7 A credit note issued to a debtor, S Moon, dated 28 June 2021 was not recorded in the books. The credit note was for price reduction on unsatisfactory repair of a piece of equipment, R540.

2.8 Assume a company tax rate of 30%.

Required:

Prepare a Statement of profit or loss and other comprehensive income for the year ended 30 June 2021 in compliance with International Financial Reporting Standards appropriate to Samke Ltd’s business activties.

QUESTION TWO

The following information relating to property plant and equipment was extracted from the accounting records of Fred’s Transport for year ended 28 February 2022;

1. Balances at 28 February 2021:

• Equipment at cost R 56 000
• Accumulated depreciation: equipment R 10 860
• Vehicles at cost R560 000
• Accumulated depreciation: vehicles R285 360

2. The following transactions in respect of property, plant and equipment took place during the current financial year:

2.1 An old vehicle was sold on 31 August 2021 for R144 000 cash. The cost price of the vehicle sold was R240 000, and its accumulated depreciation amounted to R120 100 on 1 March 2021. The proceeds from the sale of the vehicle was used to partially finance the purchase of another vehicle for R440 000 bought on 1 September 2021.

2.2 On 28 February 2022 sold used equipment for R14 400 cash. The accumulated depreciation on this equipment was R3 280 at 1 March 2021. The cost price of the equipment was R18 000.

3. Depreciation must still be provided for as follows:

• Equipment at 10% per year on the diminishing balance method, and
• Vehicles at 20% per year on the straight line method.

4. The financial year ends on the last day of February.

Required:

Prepare the property, plant and equipment note to be attached to the financial statements for Fred’s Transport for the year ended 28 February 2022.

Show the cost, accumulated depreciation and the carrying amount of the disposed assets in the property, plant and equipment note. You may omit the total column.

Show all workings. Round off all calculations to the nearest whole number.

QUESTION THREE

Kane and Abel are in partnership sharing profits and losses in the ratio of 1:1. The following relates to their business Two Wheels whereby they sell motor bikes. Their dealership is popular with many motor-bike enthusiasts.

The list of balances at 28 February 2022 before relevant additional information was taken into account is as follows:

Additional information:

1.  On 1 September 2021, Abel contributed a further R100 000 as capital into the partnership. The transaction has been recorded correctly.

2. 2 The partnership agreement stipulates the following:

   1. Partners are entitled to salaries as follows:

   2. • Kane is entitled to R18 000 per month. From 1 December 2020 his salary must be increased to R20 000 per month,

   3.  • Abel is entitled to a salary of R14 000 per month.

2.2 Interest on capital must be provided at 12 % per year.

2.3 Interest on current accounts must be provided at 5% per year on current account balances at the beginning of the year (1 March).

2.4 Kane is entitled to a bonus equal to 10% of the profit for the year before any appropriation is made in terms of the partnership agreement.

2.5 Kane and Abel share profits and losses equally.

3. During the year R144 000 and R96 000 were paid as salaries to Kane and Abel respectively. These amounts were credited to the bank account but incorrectly debited to the debtors’ control account. Correction is required.

Required:

Prepare a statement of changes in equity for the year ended 28 February 2022 for Two Wheels that is appropriate to the business of the partnership. You may omit the total column in the Current account section. Show all workings.

QUESTION FOUR

Bling Ltd was registered on 1 March 2021 with the following authorised share capital:

• 900 000 Ordinary shares (Class A)
• 400 000 9% preference shares of R5 each (Class B)

The following transactions took place for the financial year ended 28 February 2022:

Required:

Record the above transactions in the general journal of Bling Ltd for the financial year ended 28 February 2022.

NB: Record the date and a brief narration for each journal entry

QUESTION FIVE

Dash (Pty) Ltd provided the following information that was extracted from the financial records for the year ended 31 December 2021. Relevant financial information are shown below.

Information from the statement of financial position as at 31 December:

Extract of items shown on the statement of profit and loss and other comprehensive income for the year ended 31 December 2021: R

Additional information:

1. Inventory is disclosed at cost.
2. Land has not been revalued in the current financial year.
3. An extension was added to the building and completed in the current financial year. All building costs were paid for in cash. Buildings are not depreciated.
4. Interest on the long term loan is not capitalised.
5. No equipment was purchased during the current financial year but some equipment was sold during the year for cash.
6. Dividends for the year as shown in the statement of changes in equity was R75 000.

Required:

Prepare the statement of cash flows of Dash (Pty) Ltd for the year ended 31 December 2021 to comply with the International Financial Reporting Standards (IFRS) in as much as the above information allows. Use the indirect method. Comparative figures are not required.

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