Answer To: Assessment Task – Tutorial QuestionsUnit Code: HI5001Unit Name: Accounting for Business...
Suvrat answered on May 26 2021
Week 1
Evaluate the statement “Accounting is all about numbers.” Using the definition of accounting to justify your answer.
Ans –
Accounting is defined as the process of identifying, measuring, recording and communicating economic information to assist users of the information in making informed economic decisions.
According to the above definition accounting involves identifying which includes not only numbers but it requires knowledge of entity and its operations to consider the economic event as identifiable. In order to measure the impact of the economic event identified above, it requires knowledge of various accounting standards, judgments apart from only numbers. The next step involves recording of the data which needs to be classified and recorded accordingly. In order to communicate the numbers, they must be presented in a proper format/financial statements so that a normal layman can understand.
Therefore, Accounting is not all about numbers. It involves knowledge of various standards and other techniques.
Week 2
Required:
Prepare an income statement for the month of June and a balance sheet in account format for Safety Hire as at 30 June 2019.
Ans –
SAFETY HIRE
INCOME STATEMENT
For the month of June 2020
Particulars
Amount ($)
Sales:
Revenue from operations
63,000
Equipment hire income
1,70,000
Net Sales
2,33,000
Less: Cost of goods Sold
Purchases
40,000
Wage expense
75,000
1,15,000
Gross Margin
1,18,000
Less: Operating expenses
Advertising expenses
30,000
Electricity expense
18,000
Telephone expense
7,500
Total expenses
55,500
Net Income
62,500
SAFETY HIRE
BALANCE SHEET
As at June 2020
Assets
Amount ($)
Liabilities
Amount($)
Accounts receivable
63,000
Accounts Payable
40,000
Cash at Bank
45,000
Mortgage Payable
50,000
Building
85,000
Loan Payable
Land
75,000
Equity
Hire Equipment
1,80,000
Michael Donato Capital
2,95,500
Add: Net Income
62,500
Total Equity
3,58,000
Total Assets
4,48,000
Total Equity & Liabilities
4,48,000
Week 3
Required:
a) Prepare the general journal entries to record the above transactions.
Ans –
Date
Ref
Acc No.
Acc. Name
Debit ($)
Credit ($)
02-Jul
a
100
Cash at Bank
1,20,000
300
To Nicole Andreou, Capital
1,20,000
(Being capital introduced)
02-Jul
b
500
Rent expense
1,800
100
To Cash at Bank
1,800
(Being rent paid)
03-Jul
c
103
Equipment
70,000
100
To Cash at Bank
32,000
200
To Loan Payable
38,000
(Being equipment purchased)
04-Jul
d
102
Supplies
8,400
100
To Cash at Bank
8,400
(Being supplies purchased)
06-Jul
e
501
Advertising expenses
890
100
To Cash at Bank
890
(Being advertising expenses paid)
16-Jul
f
100
Cash at Bank
3,250
101
Account receivable
620
400
To revenue
3,870
(Being revenue booked)
20-Jul
g
502
Insurance expenses
480
100
To Cash at Bank
480
(Being insurance expense paid)
23-Jul
h
100
Cash at Bank
140
101
To Accounts receivable
140
(Being amount received)
28-Jul
i
301
Nicole Andreou, Drawings
560
100
To Cash at Bank
560
(Being amount withdrawn)
31-Jul
j
100
Cash at Bank
3,680
101
Account receivable
580
400
To...