Accounting Level IV Coc

Project One
Odaa PLC
Post-Closing Trial Balance
December 31, 2018

Account Title Debit Credit

Cash 200,000

Account Receivable 90,000

Allowance for uncollectable A\C 4,500

Supplies 60,000

Prepaid Rent 62,000

Office equipment 110,000

Accumulated depreciation – office equipment 33,000

Account payable 100,000

Tola, Capital 384,500

Total 522,000 522,000

The following transaction were occurred during the year 2018

Jan 05: Purchased supplies on account Br 40,000.

Mar 12: Provide service on account Br 200,000.

Apr 17: Collect accounts receivables of Br 190,000.

May 21: Paid account payable of Br 90,000.

Jun 18: Account receivable of Br 500 determined to be uncollectable (written-off).

Jul 20: Provide service to cash customer Br 150,000.

Aug 27: Total salary paid during the year was Br 90,000 (income tax and pension
contribution).

Dec 30: Paid rent of Br 36,000 for the next 12 months.

The following additional information for adjustments on December 31, 2018 was obtained
1. Bad debt expense was estimated to be Br 2,500.
2. Depreciation expense was Br 21,000 for the year.
3. Supplies on hand at the end of the year was Br 19,000.
4. Prepaid rent expired during the year was Br 72,000.
Task 1.1 Record the above journal entries.
Task 1.2 Prepared unadjusted trial balance on December 31, 2018.
Task 1.3 Record the above adjusting entries.
Task 1.4 Prepare adjusted trial balance on December 31, 2018.
Task 1.5 Prepare income statement for the year 2018 (use proclamation PLC determine business
profit tax).
Task 1.6 Prepare balance sheet on December 31, 2018 (don’t forget to report profit tax payable).

Project Two
On December 31, 2018 the cash account of BURKA PLC shows a balance of Br 128,200
and on the same date the statement received from the bank revered a balance Br 135,000.
The following additional information was also identified while cross checking the ledger of the
bank statements:
1. Outstanding checks amounts
 Check no. 213 Br 2,200
 Check no. 213 Br 1,300
 Check no. 213 Br 2,000
2. Deposit transit were Br 10,100.
3. Collection from notes receivables by the bank was Br 14,100 (Br 13,650 principal and Br
450 interest).
4. A check for Br 2,500 received from customer on account was send to the bank for deposit
but returned with the statement marked NSF.
5. A check for Br 3,600 issued to pay for purchase of supplies was wrongly recorded as Br
6,300 in general journal.
6. A check for Br 3,500 issued to pay for supplies account was erroneously recorded by the
bank was Br 5,300.
7. The bank service charge the month was Br 200.
Task 2.1 Prepare bank reconciliation statements December 31, 2018.
Task 2.2 Prepare the necessary journal entries.
 Project Three
Assume SHEGER Sole Proprietorship has the following dates related to payroll for the month of
meaziya 2011 E.C.
Transportation Over Time
S\N Employees Name Basic Salary
Allowance Duration Hours
01 Amante Dida 9,200 1,000 Up to 10pm 12

02 Bilal Kedir 6,750 950 Public Holiday 10

03 Kebeki Chala 3,200 550 From 10pm – 6am 9

04 Almaz Deme 2,300 500 Weekend 8

Additional information’s
 There are 160 monthly norms working hours.
 Assume the pension contribution is 7% and 11% by employees and employer respectively.
 Over times are paid based on labor proclamation no. 42/11
 All allowance above 1,000 are taxable.
 All employees are members of labor union and contribute 2% of their basic salary.
Task 3.1 Prepare the payroll register for the month meaziya 2011.
Task 3.2 Record payment of salary on Ginbot 15, 2011.
Task 3.3 Record the payroll tax expenses.
Task 3.4 Record the payment of tax to the tax authority and payment of pension to pension fund.

Project Four
Abdisa Trading PLC is a merchandise business which buy and resales different types of
consumption goods. The following data is obtained from its records for the year 2018.

Quantity (Unit) Unit Cost (Birr)

Beginning Inventory 15,000 150

Purchase – January 20,000 160

Purchase – March 35,000 165

Purchase – May 22,000 170

Purchase - November 30,000 175

At the end of the year physical count shows that 25,000 unit on hand. The selling price per unit
was birr 220 during the year. Moreover, the company was incurred to operating expense of Br
4,000,000.
Required: - Assuming the company is using periodic LIFO inventory methods determine
Task 4.1 Total sales revenue for the year.
Task 4.2 Cost of ending inventory on December 31, 2018.
Task 4.3 Cost of goods sold for the year.
Task 4.4 Gross profit for the year.
Task 4.5 Taxable income for the year.
Task 4.6 Business profit tax for the year.
Project Five
The following represents the beginning inventory of ADAMA FURNITURE COMPANY
for the month of January 2018. The financial statement is needed as part of the firm’s application
for a line of credit. The necessary accounting data are not maintained properly, however you fund
the following incomplete information.
 Finished goods inventory, beginning .........................4,000
 Work in process inventory, beginning .......................3,400
 Raw material inventory, beginning ............................3,100
 Sales for the period ............................85,000
 Direct labor cost .................................35,000
The following estimated data were also available:
Factory overhead cost average 30% of conversion cost.
Material purchase for the period amounts Br 24,000.
Prime cost average 80%of cost goods manufactured.
Gross profit on sales averages 25%.
Cost of goods available for sales amount Br 80,000.
Selling and distribution costs are Br 11,230.
General administrative expenses are Br 9,500.
Task 5.1 Calculate raw material ending cost.
Task 5.2 Working process ending cost.
Task 5.3 Finished goods ending cost.
Task 5.4 Prepare cost of goods manufactured statements.
Task 5.5 Prepare functional income statement.
Project Six
The following data is available to prepare as part of beginning budget for ADAMA
STEAL FACTORY for the year 2019. Adama steal factory for the year 2019 consorting the
fifty-year operation and is preparing to build its operational budget for the year coming year
(2019). The budget will detail each quarters activity and the activity for the year in total. The
operational budget is based on the following information.
1. Fourth quarter sales for 2018 are Br 56,000 units.
2. Unit sales by quarter for 2018 are project are follows
 First quarter ................65,000
 Second quarter ...........70,000
 Third quarter ..............75,000
 Fourth quarter.............90,000
Selling price is Br 400 per unit 85% of sales are on cash basis and 15% of sales are on
credit basis. Credit sales are collected in the following quarter.
3. There is no beginning inventory of finished goods and the company is planning the
following ending finished inventory for each quarter.
 First quarter ................13,000
 Second quarter ...........15,000
 Third quarter ..............20,000
 Fourth quarter.............10,000
4. Each units uses five hours (5 hrs) of direct labor and three unit of direct materials labors
are paid Br 10 per hour and one units of material costs Br 80.
5. There are 65,700 units of direct materials as of January 1, 2019. At end of each quarter
Adama steal factory plans to have 30% raw material needed for next quarters unit sales.
On December 31, 2019. Adama steal factory will end with the same level of inventory of
January 1, 2019.
6. Adama steal factory buys the material on account. Half of the purchases are paid in the
quarter and the remaining half in the following quarter. Wage and salary paid at end of
each month.
Task 6.1 Prepare sales revenue budget.
Task 6.2 Prepare production budget in unit.
Task 6.3 Direct material usage budget in unit and costs.
Task 6.4 Direct labor budget.