FNS40610 Certificate IV Accounting: Assessment 1 - Financial Reports

This document presents a completed accounting assessment for the FNS40610 Certificate IV in Accounting. The assessment comprises four parts, each contributing to the overall grade. Part 1 focuses on balance day adjustments, requiring answers to questions about the matching principle, prepayments, accrued expenses, accrued revenue, revenue received in advance, allowance for doubtful debts, depreciation, and perpetual inventory systems. The assessment also includes a portfolio of evidence drawn from the textbook 'Accounting: A practical approach' by Pearson. Further parts of the assessment involve creating balance day adjustment journal entries, closing entries, trading and profit and loss accounts, an income statement, and a balance sheet. The final parts involve completing a worksheet for final reports (10 column) and maintaining an asset register, covering depreciation and disposal of non-current assets. The student demonstrates understanding of key accounting concepts and the ability to apply them in practical scenarios.

ASSESSMENT 1
Student name: Student number:
Trainer/Assessor: Term/Year:
BSBFIA401A Prepare financial reports FNS40610 Certificate IV in Accounting
Due date: Date submitted:
Assessment 1: Portfolio of Evidence Elements: All
Performance Criteria: All
Instructions to the Students
Students must keep a copy of this assessment.
Plagiarism/Cheating is a serious offence. If a student is found plagiarising/cheating, it may
result in a penalty of suspension/cancellation of student’s enrolment.
I declare that this assessment is my own work. The material in this has not been submitted in
any other formal course of study.
Student signature: Date:
Penalty for late submission: 10% off mark per day that it is late. After three (3) days
overdue it’s a zero mark, unless there are special extenuating circumstances.
Students to retain this section as proof of Assessment
Student name: Student number:
BSBFIA401A Prepare financial reports Assessment 1: Portfolio of Evidence
Student signature: Trainer/Assessor signature:
Date:
FNS40610
Certificate IV
in Accounting

Macquarie Institute
FNS40610 Certificate IV in Accounting
BSBFIA401A Prepare financial reports
Introduction
This written assessment has been designed to assess the criteria associated with the
competency BSBFIA401A Prepare financial reports. To achieve competency in this unit, a
person must be able to demonstrate:
 preparing financial reports
 applying the Australian Accounting and Auditing Standards
 applying double-entry principles.
This competency is part of the award FNS40610 Certificate IV in Accounting.
Instructions
You must successfully complete all parts of this assessment. Your assessor will be marking
you against a competency checklist to ensure you have met the requirements of each of the
relevant competencies. You will be informed should you be deemed not yet competent by
your assessor and require re-assessment. If you feel the decision made by your assessor
was in fact incorrect please refer to your student handbook for information on the
assessment appeals process and the steps you are required to undertake.
Assessment rules
 Assessment must be typed in 12 font size.
 Assessment must be in the students own words, if the internet is used for
research, a reference list must be listed as an appendix at the end of the
assessment.
 No copying from other students.
 Failure to adhere to these rules will result in penalties.
Penalty for late submission
10% off mark per day that it is late. After three (3) days overdue it’s a zero mark, unless there
are special extenuating circumstances.
Assessment 1 - Version 1.3 Page 2 of 5
Last Updated: January 2013

Macquarie Institute
FNS40610 Certificate IV in Accounting
BSBFIA401A Prepare financial reports
Overview of Assessment 1 (25%)
This assessment is made up of 4 parts:
Part Weighting Due Date
1. Balance day adjustment. Questions.
Portfolio of evidence
5%
From the exercise 13.9. Accounting. A practical
approach. Pearson :
2. Balance day adjustment journal entries.
Closing entries.
Trading and Profit and loss accounts.
Income statement
Balance Sheet.
Portfolio of evidence
10%
From the exercise 12.7. Accounting. A practical
approach. Pearson :
3. Worksheet for final reports (10 Column)
Portfolio of evidence
5%
From the exercise 15.35. Accounting. A
practical approach. Pearson :
4. Maintain asset register.
Depreciation and disposal of non-current
assets.
Portfolio of evidence
5%
On the following pages you will find various types of information. The symbols below will be
used throughout this project to represent the different types of information.
 A description of the task to be competed A document or piece of additional information that will assist you
complete the task
 Questions that require an answer.
Assessment 1 - Version 1.3 Page 3 of 5
Last Updated: January 2013

Macquarie Institute
FNS40610 Certificate IV in Accounting
BSBFIA401A Prepare financial reports
Part 1. Balance day adjustment . Questions. (10%)
 Task Description
In this activity you will be required to write your answers to the questions.
 Task 1
1. What do we mean by the ‘matching principle’ in accounting?
Matching concept relates to the matching up of the Revenue and assigned cost. The
principle was laid in order to justify the match between the expenditure incurred in a
particular accounting year and the revenue derived from the same. For every
expenditure incurred, a justifiable match should be found is known as the “Matching
Principle”
2. Give an example of a prepayment.
Prepayment means payment in advance. For eg. Loan prepayment. A Term loan has
a defined maturity period. Any payment made against the loan repayment schedule in
advance, is Prepayment.
3. Give an example of an accrued expense.
For Eg. Insurance premium payment. The expense of premium is once a year, but the
same can be bifurcated to Accrued expense which pertains upto the year end and
prepaid which pertains to the period over and above the last date of accounting year
4. Give an example of accrued revenue.
Accured income is that kind of income which has arisen and accepted by the user. For
Eg. Interest accrued on Fixed Deposit. The fixed deposit interest is not paid at the
accounting year end. However, the interest pertaining to the accounting period can be
termed as Interest Accrued.
5. Give an example of revenue received in advance.
Advance received from Customers is a type of advance revenue received.
6. Why do businesses establish allowance for doubtful debts?
Not all customer dues have good reliability. It is prudent for the business to judge
whether the particular customer dues are realizable or not. Accordingly, provision on
doubtful debt / dues should be made in the accounts
7. Why do organisations calculate depreciation?
Depreciation helps the organization to decide the life of the asset and the need to
replace the same. It is a charge made to the Profit and Loss statement which indicates
the actual value of the asset used over the year. It is the wear and tear of the asset
which needs to be adequately worked out and charged to revenue accounts.
8. List two advantages of installing a perpetual inventory system.
Assessment 1 - Version 1.3 Page 4 of 5
Last Updated: January 2013

Macquarie Institute
FNS40610 Certificate IV in Accounting
BSBFIA401A Prepare financial reports
As the name suggests, perpetual inventory system means constant updation of
inventory movement. Two advantages:
a. Balance remains real time updated. Physical stock and book stock always matches
b. Easy reconciliation and transaction scrutiny is possible in perpetual system. It
becomes a good control measure.
Part 1. Checklist
Before you hand in these assessment tasks, use the checklist below to make sure you have
completed all the tasks and have included all relevant information.
 Written answers for Task 1, Questions 1-8.
Assessment 1 - Version 1.3 Page 5 of 5
Last Updated: January 2013