BUSINESS ADMINISTRATION

DEPARTMENT
HOA LAC
MIDTERM
SUBJECT: PRINCIPLES OF ACCOUNTING (ACC101)
Duration: …….. minutes

STUDENT INFORMATION
Name: Roll number:
Room Class:
No:

Question 1 (9 marks)

Fast Forward Ltd opened for business on 1 May 2018. Here is its trial balance
before adjustment on 30 June 2018.
Fast Forward Ltd
Unadjusted trial balance
As at 30 June 2018
Debit Credit
Cash $3920
Prepaid insurance 1600
Supplies 256
Machineries 25500
Building 50000
Accounts payable $3900
Rent revenue received in 5300
advance
Salaries payable 15000
Share capital 45000
Rent revenue 13676
Salaries expense 1600
Water expense 1000
Advertising expense 400
$83876 $83876
Other data:
1. Insurance expired at the rate of $135 per month, and is an annual
premium commencing on 1 May 2018
2. An inventory of supplies shows $60 of unused supplies on 30 June
3. Annual depreciation is $1100 on the building and $1562.5 on machineries
(hint: company uses straight line method to calculate depreciation
expense)
4. $1760 of the rent revenue received in advance pertains to June. The
remainder pertains to July.
Require:
 a. Journalise the adjusting entries on 30 June (3 marks)
b. Do closing process (2 marks)
c. Prepare the income statement as at 30 June 2018 (2 marks)
d. Prepare the balance sheet as at 30 June 2018 (2 marks)

Question 2 (1 mark)

On May 1st, JB HiFi Company completed a credit sale for $2900, the
merchandise cost $1100. Term of 2/10, n/90 and the account was paid in
full at the end of discount period.
Journalise the transaction with description