Answers for Step2 questions:
1. Ans.: As on July'4, only the ordered has been placed, nighter the advance has been given nor the film 'Autos' has been delivered. So, Assets and libalities of the theater' books is unchanged and no tranasaction is required.
2. Ans: The insuance policy is for the period of 12 months from Nov'18 to Oct'19. Therefore, for the financial year ending 31st july'19, only 9 months expenses should be booked. As per Matching and periodic concept of accounting, expenses and revneues should be recored for the period , to which that pertains. This has resulted into recording of 9 months insurance premium as expense and 3 months premium (Aug'19-Oct-19) as prepaid expenses (Assets).
3.Ans: At the year, inentory counts is very inportant, as it informs us, how much actual inventory we hold at the year end. At the time of purchase of supplies we book the expenses, but the physical count tells us, the entire supllies has not be consumed. So ther is a closing stock. This closing stock adjustment with supplies gives a fair picture of Expenses (Supplies consumed) and assets (closing stock).
4. Ans: As per accural and matching concept of accounting, expenses should be recored in the FY, to which it belongs. Although we received the Hydro (utility) invoice in Aug'5, but actual consumption has happened in July'19, so the expenses belongs to the FY ended July'19 and can't be recorded in next year.
5. Ans: A person who is handling the sales should not be given the access to accounting. It may cause imparement of segregation of duty concept and it makes the internal control system vulnerable to fraud.
Case Study in Accounting: LIGHTS, CAMERA, ACTION! Andrew Son is a Grade 11 high school student...
Case Study in Accounting: LIGHTS, CAMERA, ACTION! Andrew Son is a Grade 11 high school student in Richmond Hill, Ontario. He enjoys school and does very well in most of his classes, especially accounting. He likes accounting so much that he plans to become a Chartered Professional Accountant when he finishes university. Andrew started his first part-time job last summer as an usher at the local movie theatre, the Yorkland Theatre The Yorkland Theatre is a small theatre owned by...
please answer the question1-5. Case Study in Accounting: LIGHTS, CAMERA, ACTION! Andrew Son is a Grade 11 high school student in Richmond Hill, Ontario. He enjoys school and does very well in most of his classes, especially accounting. He likes accounting so much that he plans to become a Chartered Professional Accountant when he finishes university. Andrew started his first part-time job last summer as an usher at the local movie theatre, the Yorkland Theatre The Yorkland Theatre is a...
Q1. Jesse James graduated from high school in Wawanesa and decided to start his own business doing small building and repair jobs. Jesse knew that incorporating a business had many benefits so he set up a corporation with the help of a lawyer. The business was incorporated on July 1, 2019. Jesse had saved $20,000 which he transferred from his personal account into the bank account for Jesse James Home Improvements Ltd. (JJHI) and received shares in return. He then...
QUESTION 1 - Accrual Accounting Murray's Seafood Shop sells seafood and is owned and operated by Callum Murray. The following trial balance has been prepared at year's end. MURRAY'S SEAFOOD SHOP HARDWARE - TRIAL BALANCE AS AT 30 JUNE 2019 Debit (8) Credit (5) Cash 10 400 Accounts Receivable 45 600 Inventory (1 July 2018) 43 000 Prepaid Rent 5 400 Supplies 310 Furniture 32 500 Accumulated Depreciation - Furniture 5880 Equipment 53 000 Accumulated Depreciation - Equipment 4 500...
SECTION 1: CASE STUDY: Audit of Sales and Collections Cycle (85 Marks) Read the case below for Digitex LLC and answer the question that follow: Brief company background Digitex LLC has been in business since 1998 and has grown rapidly over the Middle East. The company is a distributor of electronic parts and equipment to the IT industry in the GCC region. Digitex has some strong internal controls policies and procedures over its business environment both internally and externally. However,...
I need all of the following journal entries done Date Transaction No. Jay opened two accounts at Union Stale Bank, using S3,000 of his own moncy. He deposited $2,500 in a checking account and $500 into savings 7:1 1 Jay borrowed S6,000 from his Aunt Emma and signed a note with 8% interest. Under the terms of the note, he must make payments of $250 plus acCrued interest on the first day of cach month. Jay put $4,500 into his...
Cameron operates a janitorial services and HVAC Company called Squeaky Clean (SC) and is trying to determine for 2018 whether he should use the cash or accrual method of tax reporting. He has the following items of income and expense: a. SC contracted with a hospital in December 2017 to install HVAC in its new wing. The contract price of $80,000 includes $50,000 for materials (COGS). The remaining cost covers the labor done by SC. The contract requires upfront payment....
Note: This problem is for the 2018 tax year. Devon Bishop, age 45, is single. He lives at 1507 Rose Lane, Albuquerque, NM 87131. His Social Security number is 111-11-1112. Devon does not want $3 to go to the Presidential Election Campaign Fund. Devon's wife, Ariane, passed away in 2014. Devon's son, Tom, who is age 18, resides with Devon. Tom's Social Security number is 123-45-6788. Devon owns a sole proprietorship for which he uses the accrual method of accounting...
Devon Bishop, age 45, is single. He lives at 1507 Rose Lane, Albuquerque, NM 87131. His Social Security number is 111-11-1112. Devon does not want $3 to go to the Presi-dential Election Campaign Fund. Devon’s wife, Ariane, passed away in 2014. Devon’s son, Tom, who is age 18, resides with Devon. Tom’s Social Security number is 123-45-6788. Devon owns a sole proprietorship for which he uses the accrual method of account-ing and maintains no inventory. His revenues and expenses for...
All questions need to be answered please. From questions 1 to question 5. ASSIGNMENT 7: FINANCIAL ACCOUNTING Note: 1. Value Added Tax (VAT) must be ignored 2. Use the formats contained in your study guide to answer questions 2 to 5 (20) QUESTION 1 REQUIRED For each of the following questions, write down only the letter of the correct answer e.g. 1.6 C. Do not shovw any calculations. 1.1 he following information relates to an item of inventory sold by...