Assingment about Accounting

College of Administration and Finance SciencesAssignment (1)
Deadline: Saturday 13/07/2024 @ 23:59
Course Name: Principles of Accounting
Student’s Name:
Course Code: ACCT490
Student’s ID Number:
Semester: Summer
CRN:
Academic Year: 1445-6 H
For Instructor’s Use only
Instructor’s Name: Dr. Abdullah A. Alakkas
Students’ Grade:
/30
Level of Marks: High/Middle/Low
Instructions – PLEASE READ THEM CAREFULLY
• The Assignment must be submitted on Blackboard (WORD format only) via allocated
folder.
• Assignments submitted through email will not be accepted.
• Students are advised to make their work clear and well presented; marks may be
reduced for poor presentation. This includes filling your information on the cover
page.
• Answer on the same document, keep the questions and put your answer in the
designated place.
• Late submission will NOT be accepted.
• Avoid plagiarism, the work should be in your own words, copying from students or
other resources without proper referencing will result in ZERO marks. No exceptions.
• All answers must be typed using Times New Roman (size 12, double-spaced) font.
No pictures containing text will be accepted and will be considered plagiarism.
• Submissions without this cover page will NOT be accepted and you must put you
information in the cover page.
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College of Administration and Finance Sciences
Assignment Question(s):
(Marks 30)
Q1. Discuss the following accounting principles and assumption and give proper
numerical example for each one of the:
1. Cost principle.
2. Revenue recognition principle.
3. Matching concept.
4. Business entity assumption.
5. On-going assumption.
(5 Mark)
ANSWER:
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College of Administration and Finance Sciences
Q2. Give financial transactions details that would reflect the following cases (for your
convenience, an example is provided). Do not forget to give full information (i.e. date,
name of the business, amount of the transaction. etc.)
1. A transaction that would increase assets and increase equity.
2. A transaction that would decrease assets and decrease equity.
3. A transaction that would increase assets and decrease Liabilities.
4. A transaction that would decrease assets and increase Liabilities.
5. A transaction that would increase assets and decrease assets.
Example: A transaction that would decrease assets and decrease equity.
(possible solution: On May 6th Alfa company paid wages salaries for $24,000
cash)
(5 Mark)
ANSWER:
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Q3. Bello Co. is an event organizer business. Bello was established in 2018. You are
provided with the following financial statement with some missing values for the
years 2018, 2019 and 2020. You are requested to complete those statements. In order
to solve the question, you have to start with 2018 statements and work forward to
subsequent years. Remember that Bello was established in 2018, thus the beginning
balance for retained earnings in 2018 is zero.
Bello Co. Income statement for the year ended December 31 20XX
(5 Mark)
Bello Co.
Income statement
For the year ended December 31 20XX
Revenues
Expenses:
Rent
Salaries
2020
100,000
?
1,500
?
Net Income
2019
?
58,500
1,500
2018
50,000
?
2,500
?
?
?
20,000
?
Bello Co.
Retained Earnings statement
For the year ended December 31 20XX
Less: Dividends
2020
?
?
?
15,000
2019
?
20,000
?
?
2018
0
?
12,500
?
Ending retained earnings
30,000
?
?
Beginning retained earnings
Plus: Net income
Bello Co.
Balance Sheet
As of December 31 20XX
2020
Assets:
Cash
A/R
Building
Total Assets
Liabilities:
A/P
Notes payable
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2019
?
32,500
90,000
?
?
5,000
2018
?
25,000
90,000
144,500
500
?
25,000
?
90,000
?
1,000
?
College of Administration and Finance Sciences
Total Liabilities
Equity:
Common stock
Retained earnings
Total Equity
Total Equity and
Liabilities
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5,500
?
?
15,500
?
15,000
?
114,000
?
?
?
119,000
149,500
?
150,000
College of Administration and Finance Sciences
Q4. Flypeople a local air carrier and SEU an educational institution, both are Saudi
companies which exchange services with one another all the time. Both companies
prepare their financial reports on monthly basis and were engaged in the following
transactions during May 2024:
1. SEU purchased 2 flight tickets for SR2,400 paying cash. The flights are
scheduled for November 2024.
2. Flypeople has a fleet of vehicles worth SR11,900,000. The average useful life
for those vehicles is 11 years with salvage value of SR125,000. Flypeople uses
straight-line depreciation method.
3. SEU as a governmental institution, it credits employees salaries on the 27th of
each month. Due to some system failure in May, salaries payment was
postponed to June 3rd. Total salaries due is SR13,000,000.
4. During May Flypeople had a balance of SR9,500 for cargo services provided to
SEU but not yet billed to them.
Required: prepare adjusting entries for both Flypeople and SEU whenever
applicable for the month of May 2024.
(5 Mark)
ANSWER:
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Q5. The Accounting Cycle constitute of 10 sequel steps. List those steps and discuss
the meaning and importance of each one of them.
(5 Mark)
ANSWER:
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Q6. Differentiate between periodic inventory system and perpetual inventory system.
(5 Mark)
ANSWER:
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