IMPORTANT NOTE: please do NOT write on the chart of accounts you received

EXERCISE 1

Required:
Record all journal entries that result from the following information in the accounts of
MONCHAN for the accounting years 20X5 and 20X6 (including end-of-period entries, if
needed). The closing date of the accounting year is December 31st and MONCHAN prepares its
financial statements in EUR.

05/03/20X5
MONCHAN repaired one piece of furniture under warranty. Material and personnel expenses
related to the repair (which have already been properly recorded in the accounts of MONCHAN)
amount to 760,00 EUR. At the end of the previous accounting period (i.e., on December 31,
20X4), the provision for warranty claims was set at 2.500,00 EUR.

JOURNAL ENTRY 05/03/20X5

No. Debit Credit Debit Credit

1 05/03/20X5
164/5 Provisions for other liabilities and charges 760,00
6381 @ Provisions for other … - Decrease 760,00
Repair under warranty

15/11/20X5
The accountant of MONCHAN makes an advance tax payment for an amount of 8.500,00 EUR
(C/A extract no. X5/185).

JOURNAL ENTRY 15/11/20X5

No. Debit Credit Debit Credit

2 15/11/20X5
6700 Belgian taxes … - Taxes due or paid 8.500,00
5500 @ Credit institutions – C/A 8.500,00
C/A extract no. X5/185
31/12/20X5
MONCHAN’s accountant decides to set the provision for warranty claims at 1% of sales. Sales
for accounting year 20X5 amount to 313.540,00 EUR. (Note that there was only one repair
under warranty during 20X5.)

MONCHAN’s accountant made an estimate of company taxes for 20X5. Based on this estimate,
MONCHAN will have to pay an additional 3.800,00 EUR to tax authorities.

Wages for the month of December are as follows:

Gross wages: 15.600,00 EUR
Contributions for social security:
Employees: 2.230,00 EUR
Employer: 1.070,00 EUR
Advance tax payments: 4.190,00 EUR

JOURNAL ENTRIES 31/12/20X5

No. Debit Credit Debit Credit

3 31/12/20X5
6380 Provisions for other … - Increase 1.395,40
164/5 @ Provisions for other liab. and charges 1.395,40
EOP entry – adjustment provision
4 31/12/20X5
6702 Belgian taxes on … - Estimated taxes 3.800,00
4500 @ Estimated taxes – Belgian taxes … 3.800,00
Estimate company taxes
5 31/12/20X5
620 Remuneration and social benefits 15.600,00
621 Employer’s contribution for social insurance 1.070,00
453 @ Deducted advance tax payments 4.190,00
454 Public service for social security 3.300,00
455 Remuneration 9.180,00
Wage calculations December 20X5
JOURNAL ENTRIES 31/12/20X5 (continued)

No. Debit Credit Debit Credit

15/04/20X6
MONCHAN receives its tax demand, which states that MONCHAN will have to pay 2.840,00 EUR
to tax authorities.

JOURNAL ENTRY 15/04/20X6

No. Debit Credit Debit Credit

1 15/04/20X6
4500 Estimated taxes – Belgian taxes on profits 3.800,00
4520 @ Taxes due – Belgian taxes … 2.840,00
7710 Regularization of estimated taxes 960,00
Tax demand 20X5

EXERCISE 2

Required:

1. Record all journal entries that result from the following information in the accounts of
MONCHAN for accounting year 20X5 (including end-of-period entries, if needed). The
closing date of the accounting year is December 31st.
2. What balances are to be found in the financial statements of 20X5 related to this loan
(i.e., mention the appropriate figures related to the loan in the selected pages of the
blank financial statements attached at the end of this exam).

01/05/20X2
Enterprise MONCHAN obtains a loan for an amount of 360.000,00 EUR from its banker. The
loan will be repaid over a 6-year period on an annual basis (i.e., each year 60.000,00 EUR will
be repaid and these repayments are made on 30/04). Interests are payable in arrear on annual
basis (i.e., together with the repayments of the loan). An annual interest rate of 3,85% applies
to the loan.
JOURNAL ENTRIES 20X5

No. Debit Credit Debit Credit

1 01/01/20X5
492 Accrued charges 6.160,00
6500 @ Interests 6.160,00
Reversal adjusting entry interests
2 30/04/20X5
42 Current portion of … 60.000,00
6500 Interests 9.240,00
5500 @ Credit institutions – C/A 69.240,00
C/A extract no. …
3 31/12/20X5
6500 Interests 4.620,00
492 @ Accrued charges 4.620,00
Adjusting entry interests
4 31/12/20X5
173 Credit institutions 60.000,00
42 @ Current portion … 60.000,00
Reclassification ST part loan
EXERCISE 3

Required:

1. Record all journal entries that result from the following information in the accounts of
MONCHAN for accounting years 20X5 and 20X6 (including end-of-period entries, if
needed). The closing date of the accounting year is December 31st.
2. What balances are to be found in the financial statements of 20X5 related to this
tangible fixed asset (i.e., mention the appropriate figures in the selected pages of the
blank format of the financial statements attached at the end of this exam).

MONCHAN owns a machine for which the following information is found in its (accounting)
records:

Cost of acquisition machine = 52.000,00 EUR

Date of acquisition machine = January 1, 20X3
Estimated residual value = 2.000,00 EUR
Estimated useful life = 5 years
Depreciation method = declining balance

Because of an economic downturn, MONCHAN decides to no longer use the machine (i.e.,
discontinuation) on December 31, 20X5. At this date, the realization value of the machine
equals 20.000,00 EUR.

On May 15, 20X6, the machine is sold to another company for a price of 21.500,00 EUR
(excluding 21% VAT).

JOURNAL ENTRIES 20X5

No. Debit Credit Debit Credit

1 31/12/20X5
6302 Depreciation on TFA 10.000,00
239 @ Machines – Acc. depreciation 10.000,00
Annual depreciation machine
2 31/12/20X5
260 Other TFA – Cost of acquisition 52.000,00
239 Machines – Acc. depreciation 43.280,00
230 @ Machines – Cost of acquisition 52.000,00
269 Other TFA – Acc. depreciation 43.280,00
Discontinuation machine
JOURNAL ENTRIES 20X5 (continued)

No. Debit Credit Debit Credit

JOURNAL ENTRIES 20X6

No. Debit Credit Debit Credit

1 21/05/20X6
416 Other amounts receivable 26.015,00
269 Other TFA – Acc. depreciation 43.280,00
260 @ Other TFA – Cost of acquisition 52.000,00
451 VAT due 4.515,00
7630 Gain on disposal TFA 12.780,00
Sales invoice no. …
Nr.
FINANCIAL STATEMENTS
BALANCE SHEET
Notes Codes Period
ASSETS
FORMATION EXPENSES ........................................ 6.1 20 .................................
FIXED ASSETS ....................................................... 21/28 .................................
Intangible fixed assets ................................................................. 6.2 21 .................................
Tangible fixed assets ................................................................... 6.3 22/27 .................................
Land and buildings ................................................................. 22 .................................
Plant, machinery and equipment ............................................. 23 .................................
Furniture and vehicles............................................................. 24 .................................
Leasing and other similar rights .............................................. 25 .................................
Other tangible fixed assets ...................................................... 26 8.720,00
Assets under construction and advance payments .................. 27 .................................
6.4/
Financial fixed assets .................................................................. 6.5.1 28 .................................
Affiliated enterprises .............................................................. 6.15 280/1 .................................
Participating interests ....................................................... 280 .................................
Amounts receivable .......................................................... 281 .................................
Other enterprises linked by participating interests ..................
6.15 282/3 .................................
Participating interests ....................................................... 282 .................................
Amounts receivable .......................................................... 283 .................................
Other financial assets .............................................................. 284/8 .................................
Shares ............................................................................... 284 .................................
Amounts receivable and cash guarantees ......................... 285/8 .................................
C 3.1
Previous period
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18.720,00
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Notes Codes Period
CURRENT ASSETS ................................................. 29/58 .................................
Amounts receivable after more than one year .......................... 29 .................................
Trade debtors .......................................................................... 290 .................................
Other amounts receivable ....................................................... 291 .................................
Stocks and contracts in progress................................................ 3 .................................
Stocks ..................................................................................... 30/36 .................................
Raw materials and consumables ....................................... 30/31 .................................
Work in progress .............................................................. 32 .................................
Finished goods .................................................................. 33 .................................
Goods purchased for resale ............................................... 34 .................................
Immovable property intended for sale .............................. 35 .................................
Advance payments............................................................ 36 .................................
Contracts in progress .............................................................. 37 .................................
Amounts receivable within one year .......................................... 40/41 .................................
Trade debtors .......................................................................... 40 .................................
Other amounts receivable ....................................................... 41 .................................
6.5.1/
Current investments ................................................................... 6.6 50/53 .................................
Own shares ............................................................................. 50 .................................
Other investments and deposits .............................................. 51/53 .................................
Cash at bank and in hand........................................................... 54/58 .................................
Deferred charges and accrued income ...................................... 6.6 490/1 .................................
TOTAL ASSETS ............................................................... 20/58
C 3.1
Previous period
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Nr.
Notes Codes Period
EQUITY AND LIABILITIES
EQUITY ................................................................. 10/15 .................................
Capital .......................................................................................... 6.7.1 10 .................................
Issued capital .......................................................................... 100 .................................
Uncalled capital1 .................................................................... 101 .................................
Share premium ............................................................................ 11 .................................
Revaluation surpluses ................................................................. 12 .................................
Reserves ....................................................................................... 13 .................................
Legal reserve........................................................................... 130 .................................
Reserves not available ........................................................... 131 .................................
In respect of own shares held............................................ 1310 .................................
Other ................................................................................. 1311 .................................
Untaxed reserves ..................................................................... 132 .................................
Available reserves ................................................................... 133 .................................
Accumulated profits (losses)............................................. (+)/(-) 14 .................................
Investment grants........................................................................ 15 .................................
Advance to associates on the sharing out of assets 2 .................
19 .................................
PROVISIONS AND DEFERRED TAXES ..................... 16 .................................
Provisions for liabilities and charges ......................................... 160/5 .................................
Pensions and similar obligations ............................................. 160 .................................
Taxation .................................................................................. 161 .................................
Major repairs and maintenance ............................................... 162 .................................
Environmental obligations ...................................................... 163 .................................
Other liabilities and charges ................................................... 6.8 164/5 .................................
Deffered taxes .............................................................................. 168 .................................
1 To deduct from issued capital.
2 To deduct from other components of equity.
C 3.2
Previous period
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Nr.
Notes Codes Period
AMOUNTS PAYABLE............................................. 17/49 .................................
Amounts payable after more than one year .............................. 6.9 17 .................................
Financial debts ........................................................................ 170/4 .................................
Subordinated loans ............................................................ 170 .................................
Unsubordinated debentures ............................................... 171 .................................
Leasing and similar obligations ........................................ 172 .................................
Credit institutions .............................................................. 173 120.000,00
Other loans ........................................................................ 174 .................................
Trade debts .............................................................................. 175 .................................
Suppliers ........................................................................... 1750 .................................
Bills of exchange payable ................................................. 1751 .................................
Advances received on contracts in progress ............................ 176 .................................
Other amounts payable ............................................................ 178/9 .................................
Amounts payable within one year .............................................. 6.9 42/48 .................................
Current portion of amounts payable after more than one year
falling due within one year 42 60.000,00
Financial debts ........................................................................ 43 .................................
Credit institutions .............................................................. 430/8 .................................
Other loans ........................................................................ 439 .................................
Trade debts .............................................................................. 44 .................................
Suppliers ........................................................................... 440/4 .................................
Bills of exchange payable ................................................. 441 .................................
Advances received on contracts in progress ............................ 46 .................................
Taxes, remuneration and social security .................................
6.9 45 .................................
Taxes ................................................................................. 450/3 .................................
Remuneration and social security ..................................... 454/9 .................................
Other amounts payable ............................................................ 47/48 .................................
Deferred charges and accrued income ....................................... 6.9 492/3 .................................
TOTAL LIABILITIES .................................................. 10/49
C 3.2
Previous period
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180.000,00
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60.000,00
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Nr. C 6.3.2

Codes Period Previous period

PLANT, MACHINERY AND EQUIPMENT

Acquisition value at the end of the period ............................................... 8192P xxxxxxxxxxxxxxxxx 52.000,00

Movements during the period

Acquisitions, including produced fixed assets .......................................
8162 .................................
Sales and disposals ................................................................................ 8172 .................................
Transfers from one heading to another ........................................ (+)/(-) 8182 -52.000,00

Acquisition value at the end of the period ............................................... 8192 0,00

Revaluation surpluses at the end of the period ........................................ 8252P xxxxxxxxxxxxxxxxx .................................

Movements during the period

Recorded................................................................................................ 8212 .................................
Acquisitions from third parties ............................................................. 8222 .................................
Cancelled ............................................................................................... 8232 .................................
Transfers from one heading to another ........................................ (+)/(-) 8242 .................................

Revaluation surpluses at the end of the period ........................................ 8252 ..................................

Depreciation and amounts written down at the end of the period .........
8322P xxxxxxxxxxxxxxxxx 33.280,00

Movements during the period

Recorded................................................................................................ 8272 10.000,00
Written back .......................................................................................... 8282 .................................
Acquisitions from third parties .............................................................. 8292 .................................
Cancelled owing to sales and disposals ................................................. 8302 .................................
Transfers from one heading to another ........................................ (+)/(-) 8312 -43.280,00

Depreciation and amounts written down at the end of the period .........
8322 0,00

NET BOOK VALUE AT THE END OF THE PERIOD ............. (23) ..................................

11
Nr. C 6.3.5

Codes Period Previous period

OTHER TANGIBLE FIXED ASSETS

Acquisition value at the end of the period ................................................ 8195P xxxxxxxxxxxxxxxxx ..................................

Movements during the period

Acquisitions, including produced fixed assets .......................................
8165 .................................
Sales and disposals ................................................................................. 8175 .................................
Transfers from one heading to another ......................................... (+)/(-) 8185 52.000,00

Acquisition value at the end of the period ................................................ 8195 52.000,00

Revaluation surpluses at the end of the period ........................................ 8255P xxxxxxxxxxxxxxxxx ..................................

Movements during the period

Recorded ................................................................................................ 8215 .................................
Acquisitions from third parties ............................................................... 8225 .................................
Cancelled ............................................................................................... 8235 .................................
Transfers from one heading to another ......................................... (+)/(-) 8245 .................................

Revaluation surpluses at the end of the period ........................................ 8255 .................................

Depreciation and amounts written down at the end of the period .........
8325P xxxxxxxxxxxxxxxxx ..................................

Movements during the period

Recorded ................................................................................................ 8275 .................................
Written back ........................................................................................... 8285 .................................
Acquisitions from third parties ............................................................... 8295 .................................
Cancelled owing to sales and disposals .................................................. 8305 .................................
Transfers from one heading to another ......................................... (+)/(-) 8315 43.280,00

Depreciation and amounts written down at the end of the period .........
8325 43.280,00

NET BOOK VALUE AT THE END OF THE PERIOD .............. (26) 8.720,00

12
Nr. C 6.9
STATEMENT OF AMOUNTS PAYABLE, ACCRUED CHARGES AND
DEFERRED INCOME
Codes Period

ANALYSIS BY CURRENT PORTIONS OF AMOUNTS INITIALLY PAYABLE

AFTER MORE THAN ONE YEAR
Amounts payable after more than one year, not more than one year
Financial debts .........................................................................................................................................
8801 ..................................
Subordinated loans ............................................................................................................................ 8811 .................................
Unsubordinated debentures ............................................................................................................... 8821 .................................
Leasing and other similar obligations ................................................................................................ 8831 .................................
Credit institutions .............................................................................................................................. 8841 60.000,00
Other loans ........................................................................................................................................8851 .................................
Trade debts ..............................................................................................................................................
8861 .................................
Suppliers............................................................................................................................................
8871 .................................
Bills of exchange payable .................................................................................................................. 8881 .................................
Advance payments received on contracts in progress .............................................................................. 8891 .................................
Other amounts payable ............................................................................................................................ 8901 .................................

Total amounts payable after more than one year, not more than one year ............................................
(42) .................................

Amounts payable after more than one year, between one and five years
Financial debts .........................................................................................................................................
8802 .................................
Subordinated loans ............................................................................................................................ 8812 .................................
Unsubordinated debentures ............................................................................................................... 8822 .................................
Leasing and other similar obligations ................................................................................................ 8832 .................................
Credit institutions .............................................................................................................................. 8842 120.000,00
Other loans ........................................................................................................................................8852 .................................
Trade debts ..............................................................................................................................................
8862 .................................
Suppliers............................................................................................................................................
8872 .................................
Bills of exchange payable .................................................................................................................. 8882 .................................
Advance payments received on contracts in progress .............................................................................. 8892 .................................
Other amounts payable ............................................................................................................................ 8902 .................................

Total amounts payable after more than one year, between one and five years ......................................
8912 .................................

Amounts payable after more than one year, over five years
Financial debts .........................................................................................................................................
8803 .................................
Subordinated loans ............................................................................................................................ 8813 .................................
Unsubordinated debentures ............................................................................................................... 8823 .................................
Leasing and similar obligations ......................................................................................................... 8833 .................................
Credit institutions .............................................................................................................................. 8843 .................................
Other loans ........................................................................................................................................8853 .................................
Trade debts ..............................................................................................................................................
8863 .................................
Suppliers............................................................................................................................................
8873 .................................
Bills of exchange payable .................................................................................................................. 8883 .................................
Advance payments received on contracts in progress .............................................................................. 8893 .................................
Other amounts payable ............................................................................................................................ 8903 .................................

Total amounts payable after more than one year, over five years ...........................................................
8913 .................................

13