Financial Accounting Review Questions and Problems

School: La Trobe University - Course: MKT 1MDP - Subject: Accounting

Review Questions 5. Describe, in your own words, what is meant by the concept of duality. 7. In each of the following cases, describe the two entries required on the worksheet. a)The owner withdraws $200. b)The business buys a vehicle for $27 500. c)The business begins negotiations with a real estate agent for the purchase of shop premises for $156 500. d)Salaries of $1760 are paid. e)The business hires a consultant for $1000. This amount is paid on hiring. f)The business receives an electricity account for $100, payable within 14 days. g)The firm receives an order of $200 for merchandise. Problems for Discussion and Analysis: 2. In 20X6, XYZ Ltd had total assets of $200 000 and total liabilities of $250 000. Non-current assets and non-current liabilities were $50 000 and $25 000 respectively. What were the current assets, current liabilities and owners' equity for 20X6? 3. In 20X6, ABC Ltd had total assets of $100 000 and owners' equity of $50 000. In 20X7, total liabilities were $50 000 more than in 20X6, and the owners' equity was $60 000. Calculate: a)the total assets figure for 20X7 b)the total liabilities figure for 20X6. 4. Given the following information, supply the missing figures. Note: Total assets were $10 000 less in 20X8 than in 20X9. PQR Ltd 20X8PQR Ltd 20X9 Current assets74 000? Non-current assets112 00086 000 Total assets?? Current liabilities23 000? Non-current liabilities?100 000 Total liabilities?100 000 Owners' equity60 000? 6. In each of the following cases, describe the two entries required on the worksheet. a)The owner pays $769 cash for a desk and chair. b)The insurance premium of $549 for one year is paid by cash.

c)The business checks the price of widgets from a supplier and is told the price is $650 per tonne. d)A computer is purchased for $4999 and payment is made by cash. The computer is subsequently found to be faulty and is returned to the supplier for a full refund. (Treat this as two separate transactions.) e)An owner withdraws $100 from the business for his personal use. f)The owner offers to pay $599 for a new computer. g)The purchase price of a Mazda De-Luxe is $48 999. A buyer offers $48 000 cash. The offer is accepted.