Accounting Question

The Assignment must be submitted (
WORD format only) via allocated folder.

.• 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.

Assignment (1)
Deadline: Saturday 7/10/2023 @ 23:59
Course Name: Principles of Accounting
Student’s Name:
Course Code: ACCT101
Student’s ID Number:
Semester: First Term 23/24
CRN:
Academic Year: 1445 H
For Instructor’s Use only
Instructor’s Name:
Students’ Grade:
/15
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.
• Students must mention question number clearly in their answer.
• 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.
Assignment Question(s):
(Marks 15)
Question 1:
(5 Marks)
1
Mohammed is the owner of a service company that provides consulting services and charges the clients
for them. He uses a journal to record his business transactions. Below are some of the transactions that
occurred in March 2023. For each transaction, prepare the journal entry in SAR currency and explain
the effect on the accounting equation.
1.
2.
3.
4.
On March 1, Mohammed invested SAR 20,000 cash in his business to start operations.
On March 5, the company bought office equipment worth SAR 10,000 on credit from a supplier.
On March 9, the company provided consulting services worth SAR 5,000 for cash.
On March 13, the company paid SAR 2,000 cash for rent and SAR 2,000 for internet bills for the
month.
5. On March 21, the company received a bill for SAR 800 for office supplies used during the
month.
6. On March 29, the company paid SAR 8,000 cash in full settlement to the supplier for the office
equipment bought on credit earlier in the month.
Question 2:
(5 Marks)
Fatima owns a beauty salon that provides hair and makeup services for events such as parties and
graduations. She uses the accrual basis of accounting to record her company’s financial transactions.
Here are some of the transactions that occurred during the year:
1. On January 1, Fatima signs a contract with a client to provide hair and makeup services for their
graduation on June 1. The total contract amount is SAR 2,000. When should Fatima recognize the
revenue for this transaction under the accrual basis?
2. On June 1, Fatima provides hair and makeup services to the client from the January 1 contract. The
client pays the full amount of SAR 2,000 on the day of the event. When should Fatima recognize
the revenue for this transaction under the accrual basis?
3. On September 1, Fatima provides hair and makeup services to a party client and invoices them for
SAR 1,500. The payment is not received until October 15.
–
When should Fatima recognize the revenue for this transaction under the accrual basis?
Question 3:
(5 Marks)
ABC Consulting is a company that provides consulting services to clients in various industries. The
following are the balances taken from the trial balance:
ABC
2
Trial Balance
31/12/2022
Account
Debit
(SAR)
Credit
(SAR)
Cash
10,000
–
Accounts Receivable
15,000
–
Supplies
5,000
–
Equipment
50,000
–
Accumulated Depreciation Equipment
–
10,000
Accounts Payable
–
8,000
Unearned Revenue
–
12,000
Common Stock
–
40,000
Dividends
5,000
–
Service Revenue
–
60,000
Salaries Expense
25,000
–
Rent Expense
10,000
–
Depreciation Expense
5,000
–
Supplies Expense
3,000
–
Interest Expense
2,000
–
Total
130,000
130,000
Required:
1.Prepare the income statement for the year ended 31 December 2022.
2.Prepare the statement of retained earnings for the year ended 31 December 2022.
3.Prepare the balance sheet as at 31 December 2022.
3