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FMA Assignment 01

This document contains instructions for four accounting assignments involving journalizing transactions, preparing ledger accounts, trial balances, adjusting entries, worksheets, and financial statements for various sole proprietorships. The first assignment involves transactions for a golf course business in March. The second assignment provides a trial balance for a resort in August and requires adjusting entries and an adjusted trial balance. The third assignment gives a trial balance for a consulting firm in December and requires annual adjusting entries, a worksheet, and full financial statements. The fourth assignment provides transactions for a carpet cleaning business in March and requires similar steps as the first three assignments.

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Dejen Tagelew
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231 views

FMA Assignment 01

This document contains instructions for four accounting assignments involving journalizing transactions, preparing ledger accounts, trial balances, adjusting entries, worksheets, and financial statements for various sole proprietorships. The first assignment involves transactions for a golf course business in March. The second assignment provides a trial balance for a resort in August and requires adjusting entries and an adjusted trial balance. The third assignment gives a trial balance for a consulting firm in December and requires annual adjusting entries, a worksheet, and full financial statements. The fourth assignment provides transactions for a carpet cleaning business in March and requires similar steps as the first three assignments.

Uploaded by

Dejen Tagelew
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Financial and Managerial Accounting

Assignment 01

Course Instructor: Kirubel Asegidew (Ass Prof)

Individual assignment: for the course Financial and Managerial Accounting


Requirements
⮚ Legible and neat Page format will be rewarded.
⮚ Strictly follow the instruction given below.
⮚ Clear and observable computation is required
⮚ The project will be marked out of 25%.
⮚ Doing this assignment negligently will reduce your point.

Instruction: Show your computation (NB. Neatness and clear presentations has
its own values)

1) Nuru Meda Golf and Driving Range plc was opened on March 1 by Nuru. The
following selected events and transactions occurred during March.

Mar. 1 Invested Br.120,000 cash in the business in exchange for ordinary


shares.
3 Purchased Mechare Meda’s Golf Land for Br. 76,000 cash. The price
consists of land Br. 20,000, building Br. 44,000, and equipment Br.
12,000. (Make one compound entry.)
5 Advertised the opening of the driving range and miniature golf course,
paying advertising expenses of Br. 3,200.
6 Paid cash Br. 2,480 for a 1-year insurance policy.
10 Purchased golf equipment for Br.5,000 from Young Company, payable in
30 days.
18 Received golf fees of Br.2,400 in cash.
25 Declared and paid a Br.2,000 cash dividend.
30 Paid salaries and wages of Br.1,800.
30 Paid Young Company in full.
31 Received Br. 1,500 of fees in cash.

Snyder uses the following accounts: Cash, Prepaid Insurance, Land, Buildings,
Equipment, Accounts Payable, Share Capital—Ordinary, Dividends, Service
Revenue, Advertising Expense, and Salaries and Wages Expense.

Instructions

● Journalize the March transactions.


2) Haile Resort opened for business on June 1 with eight air conditioned units. Its trial
balance on August 31 is as follows.

Haile Resort
Trial Balance
August 31, 2022
Debit Credit
Cash Br. 39,200
Prepaid Insurance 9,000
Supplies 5,200
Land 40,000
Buildings 240,000
Equipment 32,000
Accounts Payable Br. 9,000
Unearned Rent Revenue 9,200
Mortgage Payable 100,000
Share Capital—Ordinary 200,000
Retained Earnings 0
Dividends 10,000
Rent Revenue 172,400
Salaries and Wages Expense 89,600
Utilities Expense 18,400
Maintenance and Repairs Expense 7,200
Br.490,600 Br.490,600
Other data:

1. The balance in prepaid insurance is a 1-year premium paid on June 1, 2022.


2. An inventory count on August 31 shows Br.1,300 of supplies on hand.
3. Annual depreciation rates are buildings (4%) and equipment (10%).
4. Unearned rent revenue of Br.7,600 should be recognized as revenue prior
to August 31.
5. Salaries and wages of Br.750 were unpaid at August 31.
6. Rentals of Br.1,600 were due from tenants at August 31.
7. The mortgage note is dated 1/1/2022. The mortgage interest rate is 8% per
year.

Instructions

a. Journalize the adjusting entries on August 31 for the 3-month period


June 1–August 31.
b. Prepare an adjusted trial balance on August 31.
3) The following are the trial balance and other information related to Soft Tech, a
consulting engineer.
Soft Tech, Consulting Engineer
Trial Balance
December 31, 2022
Debit Credit
Cash Br. 59,000
Accounts Receivable 99,200
Allowance for Doubtful Accounts Br. 1,500
Supplies 3,920
Prepaid Insurance 2,200
Equipment 50,000
Accumulated Depreciation—Equipment 12,500
Notes Payable 14,400
Share, Capital 104,020
Dividend 34,000
Service Revenue 200,000
Rent Expense 19,500
Salaries and Wages Expense 61,000
Utilities Expense 2,160
Office Expense 1,440
Br. 332,420 Br. 332,420
Other data:
1. Fees received in advance from clients Br.12,000.
2. Services performed for clients that were not recorded by December 31,
Br.9,800.
3. Bad debt expense for the year is Br.2,860.
4. Insurance expired during the year Br.960.
5. Equipment is being depreciated at 10% per year.
6. Fine Tech gave the bank a 90-day, 10% note for Br.14,400 on December 1,
2022.
7. Rent of the building is Br.1,500 per month. The rent for 2022 has been
paid, as has that for January 2023.
8. Salaries and wages earned but unpaid December 31, 2022, Br.5,020.
Instructions
a. From the trial balance and other information given, prepare annual
adjusting entries as of December 31, 2022.
b. Prepare the worksheet
c. Prepare an income statement for 2022, a statement of owner’s equity,
and a classified statement of financial position.
d. Maintain the necessary closing entry.
4) Mr. Arian opened Arian’s Carpet Cleaners on March 1, 2021. During March, the
following transactions were completed.

Mar. 1: Invested Br. 35,000 cash in a share of a business.

Mar. 1: Purchased used Truck (equipment) for Br. 6,000, paying Br. 2,000 cash
and the remaining balance on account.

Mar. 3: Purchased cleaning supplies for Br. 1,500 on account.

Mar. 5: Paid Br. 1,200 cash on one-year insurance policy effective March

Mar. 14: Billed customers Br. 4,800 for cleaning services.

Mar. 18: Paid Br. 1.500 cash on amount owed on Truck and Br. 500 on amount
owed on cleaning supplies.

Mar. 20: Paid Br. 7,000 cash for employee salaries.

Mar. 21: Collected Br. 3,800 cash from customers billed on

Mar. 28: Billed customers Br. 2,500 for cleaning services.

Mar. 31: Paid advertising expenses of Br. 2000.

Mar. 31: paid a dividend of Br. 3000.

Requirements:

1) Journalize the March transactions.


2) Prepare necessary Ledger Accounts.
3) Prepare a Trial Balance at March 31
4) Journalize the following adjustments and prepare an adjusted Trial
Balance:
i. Earned but unbilled revenue at March 31 was Br. 1000.
ii. Depreciation on equipment for the month was Br. 200.
iii. One-twelfth of the insurance expired.
iv. An inventory count shows Br. 400 of cleaning supplies on hand
v. Accrued but unpaid employee salaries were Br. 700.
5) Prepare the worksheet
6) Prepare an income statement, a statement of owner’s equity, and a
statement of financial position.
7) Maintain the necessary closing entry.

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