Financial Accounting and the Regulatory Framework - Exam Answer Booklet

BA (HONS) BUSINESS FINANCE PATHWAY
SEMESTER 2 EXAMINATIONS 2021/22
FINANCIAL ACCOUNTING AND THE
REGULATORY FRAMEWORK
ANSWER BOOKLET
INSTRUCTIONS TO CANDIDATES:
There are four compulsory questions on this
paper.
Answer all four questions.
All questions carry equal marks.
Calculators may be used but full workings
must be shown. You can copy and paste any
calculation from Excel to MS Word answer
Booklet.
Please submit your Answer Booklet through
Turnitin Link in Moodle.

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Answer to the Question 1 (a)
Write your response here
Statement of profit and loss account (Sandra Shop)
For the year ended 31st December, 2020
Particulars Details Amount
Sales revenue 196375
Less Cost of Sales:
Opening inventory 8560
Add Purchases 123000
Less closing inventory 9400
Total 122160
Gross Profit 74215
Less Operating expenses:
Rent minus prepaid rent 6000 - 2000 4000
Heat and Light 12000
Wages and salaries 32000
Motor expenses 12350
Insurance 5600
Bad debt 200
Interest on loan 10000 * 5% 500
outstanding gas and electricity expense 250
Adjustment for baddebts (36450 * 2%) 729
Depreciation on fixtures and fittings 38900 * 5% 1945
Depreciation on motor vehicle (12500 - 7600) * 20% 980 71574
EBIT 2641
Interest on loan 10000 * 5% -500
Net Income/ Profit 2141
Answer to the Question 1 (b)
Write your response here
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Statement of Financial Position (Sandra Shop)
As at 31st December, 2020
Particulars Cost
Accumulated
depreication Amount
ASSETS
Non-current assets:
Fixture and fittings 38950 8450 + 1945 28505
Motor Vechile 12500 7600 + 2500 2400
Current assets:
Inventory 9400
Accounts receivable 36450
Prepaid rent 2000
Bank 4780
Cash 225
Total 83760
Equity and liabilities
Current liabilities
Accounts payable 5460
Provision for doubtful debt 729+ 200
Interest payable 500
Outstanding gas and electricity 250
7219
Non-current liabilities
Loan 10000
Equity
Opening equity 110000
Add Net profit of the year 2141
Less Drawings 45600 66541
Total 83760
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