Mancosa Financial accounting 2A case study exercise, Assignments of Financial Accounting

Download Mancosa Financial accounting 2A case study exercise and more Assignments Financial Accounting in PDF only on Docsity! Case Study PROGRAMME Bachelor of Commerce in Accounting MODULE Concepts of Financial Reporting YEAR Two (2) INTAKE January 2024 Semester 1 MARKS 30 QUESTION 1 [30 MARKS) Kinta Baloyi Limited has an authorised share capital of 2 500 000 ordinary shares of no-par value, of which 600 000 had already been issued by the time the trial balance was prepared. The financial director requests your accounting knowledge in preparing the financial statements for the year ended 31 December 2021, and provides you with the following information: Trial balance at 31 December 2021 Debit R Credit R Property 1 300 000 Furniture and Equipment (carrying value) 925 000 Investments 150 000 Bank 35 000 Trade receivables 222 000 Inventory 201 000 Ordinary share capital (600 000 shares) 1 200 000 Retained earnings (1 January 2021) 210 000 Revaluation surplus (1 January 2021) 225 000 14% Loan from SABA Bank 100 000 Trade payables 90 000 Current tax payable 152 000 Sales 4 900 000 Dividend income 55 000 Interest income 15 000 Profit on disposal of equipment 20 000 Cost of sales 3 020 000 Distribution costs 360 000 Operating costs 72 000 Administrative costs 330 000 Tax expense 352 000 6 967 000 6 967 000 Additional information: 1. On 31 December 2021 it was estimated that the inventory has a net realisable value of R180 000. No entries have yet been made for this. 2. The loan from SABA Bank was acquired on 1 January 2020 and is repayable in full on 1 January 2022. The Interest is payable annually in arrears on 1 January. Provide for the interest outstanding on the loan for the current financial period. Facilitator Mr. Ndivhuwo Sirembe Programme: Bcom (ACC) Year: 2 Module: Financial Accounting 2A  uses student engagement to teach.  asks students to make their thinking explicit.  is a more student-centered approach.  gives students greater involvement and control over their learning.  develops students” higher-order thinking skills.  helps students reflect on their understanding Examination preparation Statement of comprehensive income  Income received in advance (-)  Prepaid expense (-)  Accrued expense (+)  Accrued income (+) QUESTION 1 [30 MARKS) Kinta Baloyi Limited has an authorised share capital of 2 500 000 ordinary shares of no.par walue, of which 600 000 had already been issued by the time the tial balance was prepared. The financial director requests yur accounting knowledge in preparing the financial statements for the year ended 31 December 2021, and provides you with the following information: Trial balance at 31 December 2021 Question oa oa R R Property 1.300 000 Furniture and Equipment (carrying value) 925000 Investments 150 000 Bank 35000 Trade receivables (222 000 Inventory (201 000 Ordinary share capital (600 000 shares) 4200 000 Retained eamings (1 January 2021) 210 000 Revaluation surplus (1 January 2021) 225 000 14% Loan from SABA Bank 100 000 Trade payables 90 000 Current tax payable 152 000 Sales 4900 000 Dividend income 55 000 Interest income 15 000 Profit on disposal of equipment 20 000 Cost of sales. 3020 000 Distribution costs 360 000 Operating costs 72000 Administrative costs 330 000 Tax expense 352 000 6 967 000 6 967 000 Question Additional information: .0n 31 December 2021 it was estimated that the inventory has a net realisable value of R180 000, No entries have yet been made for this. 1 The loan from SABA Bank was acquired on 1 January 2020 and is repayable in full on 1 January 2022, The Interest is payable annually in amears on 1 January, Provide for the interest outstanding on the loan for the current financial period,  Debit Credit Interest on loan (P/L) Loan (SFP)  Debit Credit Property (SFP) Revaluation Surplus (SC!)  Debit Credit Property (SFP) Revaluation Surplus ({SOCl) Statement of changes in rolUTiaYs Ordinary Retained Revaluation | Total equity share earnings Opening 1200 000 210 000 225 000 1635 000 balance Profit for the 821 000 821000 year Sharesissued | 250000 250 000 Dividends (145 000) (145 000) Revaluation 300 000 300 000 surplus Closing 1450 000 886 000 525 000 2.861000 balance Statement of financial position Assets Non-current assets 2675 000 Property ( fe 1600 000 Furniture and equipment Investment Current assets 687 000 Inventory (BOmO00 - 21 000) 180 000 Trade receivable 222 000 Cash and cash equivalent (35.000 + 285 000 Total assets 3362000 Equity and liability Equity 2861000 Liabilities 501 000 Current liabilities 501000 Current portion on loan 100 000 Accrued interest 14000 Trade and other payable 90 000 Shareholders for dividends 145 000 Current tax payable 152000 Total equity and liabilities 3.362000  Question 2 Divine Ltd Divine Ltd is a retailer of computer accessories. The entity applies the perpetual inventory system. On 01 January 2024 they had 150 units in stock costing R180/unit. Date jan 10 200 units purchased at R185 each jan 12 220 units sold at R300 each jan 15 280 units purchased at R190 each jan 16 50 units bought on the 15" returned to supplier jan 20 160 units sold at R310 each lan 25 320 units bought at R200 each an 28 500 units sold at R350 each Required Use the First in First Out Method to determine the gross profit for the period —{10 Marks) Note: Use the following template to present your inventory cost card details Inventory Stock Card: January 2024 2 units x R10 2 Units x R10: Solution Inventory Stock Card: April 2024 Bric) Balance 700 Units x R150= R105 000 300 units x R160 =R48 000 1000 Units x R153= R153 000 (R153 000/1000u=R153/u) 200 Units x R165= R33 000 1200 Units x R155= R186 000 (R186 000/1200u=R155/u) 650 Units x R155 = R100 750 550 Units x R155 = R85 25 250 Units » R195 = R38 750 300 Units « R155 = R46 500 25 300 units x R160 =R48 000 600 Units x R157.50 = R94 500 (R94 500/600u=R157.50/u) 30 400 Units x R157.50 = R63 000 200 Units x R157.50 = R31 500 R202 500 Thank You!!