Question

1. On 1st July 2018, Ali Baba decided to open up a sole proprietorship with the following items, Cash RM4900; Inventories RM3500: Delivery van RM20,000: Land and Building RM200000 Loan from Agrobank by the business RM110000. What was the amount of capital that Ali was putting into the business? Format: 834600 Format: 75300 Ali's total equity in the business is 2. Mehmeh Sdn Bhd reports the following assets and liabilitie Bank = 65500, Accounts Payable - 23700, Buildings - 15000, Bonds - 8000, Accounts Receivable = 10000. Compute the total liabilities that should be reported in the company's balance sheet. 3. Yam Sdn Bhd. has Current Assets – RM50000 and Total Assets = RM178600 It also has Current Liabilities RM30000 and Total Liabilities = RM74910 The Retained Earnings - RM9200. What is the amount of Yam Sdn Bhd. Owners' equity? 4. Aiwanmoni is a wholesale trader. The following transactions have occurred for him:i Commence business with cash RM229000 and a shop lot valued at RM62000, 11. Bought goods for resale for cash of RM80000, ti. Bought goods for resale on credit from Seeme, worth of RM1000, iv Bought furniture with cash worth RM5000, v. Return defective furniture (& get back the money paid) of worth RM1800 How much is the total assets that Aiwanmoni have now? 342000 Format: 86340 Format: 759000

Answer 1

1) Total Assets = Total Liabilities + Capital

Capital = Total Assets - Total liabilities

Capital = [ Cash + Inventories + Delivery van + Land and Building ] - [ Loan from Agrobank ]

Capital = [ 4,900 + 3,500 + 20,000 + 200,000 ] - 110,000 = 118,400

2) Total liabilities = Accounts Payable + Bonds

Total liabilities = 23,700 + 8,000 = 31,700

3) Owner's equity = Total assets - total liabilities

Owner's equity = 178,600 - 74,910 = 103,690

Note : Owner's equity includes retained earnings .

4) Accounting equation to calculate total assets

	Assets				=	Liabilities+	Capital
	Cash +	Shoplot+	Stock+	Furniture	=	Accounts payable
(i)	229,000	62,000			=		291,000
(ii)	(80,000)		80,000		=
(iii)			51,000		=	51,000
(iv)	(5,000)			5,000	=
(v)	1,800			(1,800)	=
Total	145,800+	62,000+	131,000+	3,200	=	51,000 +	291,000

Total assets = 145,800 + 62,000 + 131,000 + 3,200 = 342,000