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MGT101 - Financial Accounting Assignment No. 02 Solution and Discussion Spring 2013 Due Date Jun 19, 2013

 

A company, whose accounting year is calendar year, purchased machinery inclusive of installation charges amounting to Rs. 250,000 on 1st January 2008.

On 1

st October 2012, the machinery has become obsolete and is sold for Rs. 60,140.

Company charged the deprecation @20% per annum on plant and machinery. It is the policy of the company to charge the deprecation of all fixed assets on the basis of use under diminishing balance method.

Required:

1. Prepare depreciation schedule for five years showing the four columns i.e. Years, Depreciation expense, Accumulated depreciation and Book value.

2. Calculate the profit or loss on disposal of machinery.

QUESTION-02

Required:

Based on the above information, you are required to calculate the following for the period ended on 31

st December 2012:

1. Net sales

2. Gross purchases

3. Administration expenses

4. Financial expenses

5. Current assets

6. Current liabilities

Following information is available of a business concern for the year of 2012.

Items

Rs.

Gross sales

900,000

Return inwards

50,000

Return outwards

40,000

Net purchases

950,000

Gross loss

200,000

Advertising expenses

200,000

Distribution expenses

100,000

Salaries of clerical staff

300,000

Office rent

250,000

Bank charges

50,000

Long term loan taken from bank on 1

st January @ 12% per annum

500,000

Cash

90,000

Accounts receivable

60,000

Plant and machinery

300,000

Building

900,000

Accounts payable

35,000

Short term borrowings

25,000

Views: 3673

Replies to This Discussion

solution Q # 1

     

Year Cost

depreciation 

acc depreciation        

book value

 

 

50000

50000

200000

 

 

40000

90000

160000

 

 

32000

122000

128000

 

 

25600

147600

102400

 

 

15360

162960

87040

 

 

                                                                                      250000

1st                50000                     50000                             200000

2nd              40000                        90000                           160000

3rd                32000                      122000                         128000

4th                25600                      147600                         102400

5th                15360                      162960                         87040

note =  5ht year dep caculated in 9/12 like that

102400*9/12*20/100=15360

book value = 87040

sale price = 60140

loss = 26900 (87040-60140)

 

 

Q.2

(1) Net sale

net sale=gross sale -return inward

=900000-50000

=850000

(2)gross purchases

gross purchases=net purchases return outward

=950000+40000

=990000

(3)administration expenses

admin expense=salaries of clerical staff + office rent

=300000+250000

=550000

(4)financial expense

interest on bank loan 12%+bank charges

=50000+60000

=110000

(5)current assets

cash +account receivable

=90000+60000

=150000

(6)current liabilities

account payable +short term borrowing+interst on bank loan

=35000+25000+60000

=120000




SEMESTER SPRING 2013

FINANCIAL ACCOUNTING (MGT101)

ASSIGNMENT NO – 02

Asad Azeem (mc130200467)

 

 

QUESTION-1

  • Prepare depreciation schedule for five years showing the four columns i.e. Years, Depreciation expense, Accumulated depreciation and Book value.

Years

Depreciation expense

Accumulated depreciation

Book value.

01-January-2008

 

 

250,000

31-December-2008

50,000

50,000

200,000

31-December-2009

40,000

90,000

160,000

31-December-2010

32,000

122,000

128,000

31-December-2011

25,600

147,600

102,400

31-December-2012

15,360

162,960

87,040

 

  • Calculate the profit or loss on disposal of machinery.

 

 

Book value after five years Rs. 87,040

Sale price Rs. 60,140

Profit on sale Rs. 26,900(87,040– 60,140)

 

 

 

 

 

 

 

 

 

 

 

QUESTION-2

  1. 1.      Net sales:

=Sales-Sales Return

=900,000 - 50,000

=850,000

  1. 2.      Gross purchases:

=Net Purchase + Purchase Return

=950,000 + 40,000

=990,000

  1. 3.      Administration expenses:

=Salaries of clerical staff+ Office rent

=300,000 + 250,000

=550,000

  1. 4.      Financial expenses:

= Long term loan taken from bank on 1st January @ 12% per annum + Bank charges

=60,000 + 50,000

=110,000

  1. 5.      Current Assets:

=Cash + Accounts Receivable

=90,000 + 60,000

=150,000

  1. 6.      Current liabilities:

=Loan (Long Term + Short Term) + Accounts Payable

= 465,000(440,000+25,000) +35,000

=500,000



Q.2

(1) Net sale

net sale=gross sale -return inward

=900000-50000

=850000

(2)gross purchases

gross purchases=net purchases return outward

=950000+40000

=990000

(3)administration expenses

admin expense=salaries of clerical staff + office rent

=300000+250000

=550000

(4)financial expense

interest on bank loan 12%+bank charges

=50000+60000

=110000

(5)current assets

cash +account receivable

=90000+60000

=150000

(6)current liabilities

account payable +short term borrowing+interst on bank loan

=35000+25000+60000

=120000


MGT101 2nd Assginemt solution spring 2013

Attachments:

current liabilities me account payble or short term borrowings ayen gi 

current asset me accounts rec or cash ate hain plant or machinery non current asset hain 

here is my solution 

Q1 solution on the bases of use

Years

Depreciation expense

Accumulated depriciation

Book value

1

50000

50000

200000

2

40000

90000

160000

3

32000

122000

128000

4

25600

147600

102400

5

15360

162960

87040

 

 

Workings

 

 

Year end 31 dec 2008 =     250000X20% = 50000

Year end 31 dec 2012 =     102400 X 20% = 20480..       20480 X 9/12 = 15360

 

 

Q 1.2

Profit and loss on disposal

 

 

Disposal proceed =                 60140

Net book value at date =        87040

Loss                                         26900

 

 

Q2

Solution

  1. Net sales

= 900000-50000

=850000

  1. Gross  purchases

950000+40000

=990000

  1. Administration expense

=300,000 + 250,000

=550,000

  1.  Financial expenses

 

=500,000 + 50,000

=550,000

  1.  Current Assets

=Cash + Accounts Receivable

=90,000 + 60,000

=150,000

  1. Current liabilities

=35000+25000

=60000

 

please share correct solution of current liabilities.

which one is correct from the following?

1) Loan (Long Term + Short Term) + Accounts Payable

= 465,000(440,000+25,000) +35,000

=500,000

2) Current liabilities

=35000+25000

=60000

3) Loan (Long Term + Short Term) + Accounts Payable

= 465,000(440,000+25,000) +35,000

=500,000

yr 100% solution de du 3 dafa f a gaya hai mgt101 mn plzzzzzzzzzzz koi help kr du...

MGT_101_ASSIGNMENT 2 SOLUTION

See the attached file please

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