FINAL EXAMINATION (Online)

TRIMESTER 2, 2022
Guideline

General Information:

1. See Exam timetable.

2. Exam is Turnitin submission. Similarity rate must not be
exceeded 20%.
3. Download the Exam guideline from Moodle.
4. You need to download all resources from Moodle. It would be
closed on Friday 29/07/2022.
5. Get all weekly resources ready so that when I will discuss
exam hints, you can write notes.

6. Assessment 1 and assessment 2 results are published. This is the

first time publish the results before exam. You need to count your
marks and decide how much you need for exam to pass the unit. But
I would prefer everyone to think two assessments marks are zero,
so that you can achieve 50 marks out of 100 marks in exam. This will
help you to get D / HD in the unit. There is an exam passing rule in
this unit, see page 7 of subject outline: “To pass this subject student
must accumulate 50 marks out of 100 marks in the final exam”.
First page of the online exam

STUDENT ID

STUDENT NAME

Note: do not forgot to write student Id and student name in exam in the above box.
SUBJECT NAME: Accounting Systems and Processes

SUBJECT CODE: MCR004A

TIME ALLOWED: 2 Hours

PERMITTED MATERIALS:

• This is an Open Book exam.

INSTRUCTIONS FOR STUDENTS:

• You do not require a separate answer booklet. Please type your responses in the
space provided.
• Type your full name and ID at the top of this page.
• This exam consists of two sections:
• Section A has THREE theory questions and is worth 30 marks.
• Section B has FIVE computational questions and is worth 70 marks.
• Total marks for this exam is 100.
• This exam is worth 60% of the total grade for this subject.
What you have learned during the semester:
2.5 Subject Contents and Schedule

Teaching Topic Required Reading and Required Activity, Tutorial and

Week / Date Learning Outcomes Assessment Questions
Week 1 Introduction to Accounting and Chapter 1, & Chapter 13 Each week, your lecturer will set
the conceptual framework and LO - a activities/questions/ case studies that
accounting regulation. will be discussed in tutorials.

Week 2 The recording processes Chapter 2 Each week, your lecturer will set
LO - b activities/questions/ case studies that
will be discussed in tutorials.

Week 3 Accrual accounting concepts Chapter 3 Each week, your lecturer will set
LO - c activities/questions/ case studies that
will be discussed in tutorials.

Week 4 Inventories Chapter 4 Each week, your lecturer will set

LO - d activities/questions/ case studies that
will be discussed in tutorials

Week 5 Recording and analysis inventory Chapter 5 Each week, your lecturer will set
LO - e activities/questions/ case studies that
will be discussed in tutorials.
Assessment 1 Group Report
Moodle forum post due (15%)
Week 6 Accounting information systems Chapter 6 Each week, your lecturer will set
LO - f activities/questions/ case studies that
will be discussed in tutorials

Week 7 Reporting and analysing cash Chapter 7 Each week, your lecturer will set
and receivables LO - g activities/questions/ case studies that
will be discussed in tutorials.

Week 8 Reporting and analysing non- Chapter 8 Each week, your lecturer will set
current assets LO - h activities/questions/ case studies that
will be discussed in tutorials

Week 9 Reporting and analysis liabilities Chapter 9 Each week, your lecturer will set
LO - i activities/questions/ case studies that
will be discussed in tutorials.
Assessment 2
MYOB project Completion
Moodle forum post due (25%)
Week 10 Reporting and analysing equity Chapter 10 Each week, your lecturer will set
LO - j activities/questions/ case studies that
will be discussed in tutorials.

Week 11 Financial statements analysis Chapter 12 Each week, your lecturer will set
and decision making LO - k activities/questions/ case studies that
will be discussed in tutorials.
The Computational exercises you have done
in class:
Week 2 William Business / Mohan Consultant (HW)

Transaction analysis
Journal
Ledger posting
Ledger balancing
Trial balance
Statement of financial performance (Income
statement)
Statement of financial position (balance sheet)

Week 3 William Business / Mohan Consultant (HW)

Trial balance
Statement of financial performance (Income
statement)
Statement of financial position (balance sheet)

Balance day adjustment: Ewok Ltd

Week 4 Ten column worksheets: Ewok Ltd

Week 5 Inventory Records: PSA5.3 Modelmania Ltd
PSA5.3: Zoom Ltd
Week 6 Identification of General journal and special
journals
Week 7 Bank Reconciliation William associates, Sunny
Barger
Petty cash (Bill Ltd) HW
Week 8 Depreciation methods PPT exercise
Week 9 Problem 9.1Cling on ltd (9.2, 9.7 HW) Liabilities
Week 10 Share issue exercise 1, 2, 3
HW: 10.1 Sports ltd, 10.9: dividend, 10.10
Week 11 Financial statements analysis: exercise 1 & 2
HW: 12.6, 12.8, 12.9

Note: All the above weekly class exercises

and homework exercises must need to
practice for the final examination

Final Exam guideline 0222: Accounting Systems & Processes August 2022 online Page 4 of 10
Additional practices for exam: Theory Component:

1. Three types of business (sole trader, partnership and company with advantage
and disadvantage) legal form.
2. Corona virus impact on global financial markets, accounting implications for
example interruption of production. Need to identify more as many as. Need to
do research.

3. Understanding and meaning if the following statements:

a. Statement of financial performance
b. Statement of financial position
c. Statement of owners’ equity

4. Understanding overstatement & understatement of assets, liabilities, and profit.

5. GAAP 10 principles:
a. The accounting entity concept.
b. The going concern principle.
c. The cost principle.
d. The monetary principle.
e. Conservatism principle.
f. Working capital.
g. Full disclosure principle.
h. Accounting period
i. Accrual Accounting
j. Cash Accounting

6. Definition of internal control and briefly discuss the characteristics of an effective

internal control system beginning with competent, reliable, and ethical personnel.

7. Difference between perpetual inventory systems and periodic inventory systems.

8. Develop the following definitions:

o Debt financing
o Recognition criteria
o Drawings
o Prudence
o Expense recognition
o Liability
o Depreciation expense
o Qualitative characteristics of financial information
o Materiality
o Income recognition provision

9. Importance of adjusting entries.

10. Purpose and function of accounting

Final Exam guideline 0222: Accounting Systems & Processes August 2022 online Page 5 of 10
Additional practices for exam: Computational exercises:

1. Understanding Debit and credit principles in transaction, Journal entries, ledger concept
and trial balance.

2. Understanding Accounting equation.

Example: Wages of $8000 are owing to employees for work already performed.

Assets = Liability + Equity

↑ Accrued wages 8000 ↓ Wages 6,000

3. Understanding sales transaction and credit terms with journal entry

Sample Exercise: A credit sale is made on 10 July for $6000, terms 2/10, n/30. On 12
July, $600 of goods are returned for credit. Give the journal entry on 19 July to record
the receipt of the balance due within the discount period.

4. Understanding three depreciation methods: Straight line, reducing (diminishing) balance

and unit of production method.

5. Understanding Cost of Sales, Gross profit, expenses, and net profit

6. A credit sale is made on 10 June for $1000, terms 2/10, n/30. On 12 June, $100 of
goods is returned for credit. Give the journal entry on 19 June to record the receipt of the
balance due within the discount period.

Sales $1000 – Return $100 = $900 – discount ($900 x 2%) > 18 = 882

ENTRY:
DR Cash $882
DR Sales discount $18
CR Accounts receivable $900

7. Understanding Accounts receivable journal entries

Sample Exercise:

On 30 April, Navana Ltd estimated that $12,000 of its receivables were likely to be
uncollectable given the debtor was in serious financial difficulty. The company recorded
this amount as an additional to Allowance for Impairment.

On 11 October, Navana Ltd determined that the debt was uncollectable and wrote it off.

On 12 November, the debtor unexpectedly paid the amount previously written off.

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 Required:

Prepare the journal entries on 30 April, 11 October, and 12 November

8. If equity at the beginning of the accounting period was $250,000 and at the end of the
period $150,000 and profit made by the business during the period were $60,000.
Calculate the amount of Drawings that were made during the period.

Equity at start $ 250,000

Profit for the year 60,000

330,000

Less equity at end 150,000

Drawings $180,000

9. A company disposed of a piece of equipment for $20,500 on 30-06-2008. This equipment

was purchased for $60,000 on 1-07-2005 with a usual life of 6 years. Prepare the journal
entry(s) recording this transaction.

30/6/2008
Accumulated Dep dr 30000, Equipment cr 30000

Workings: 60000 /6 = 10000 x 3 years (2005 to 2008) = 30000 Depreciation

Original entry was: Depreciation Dr, Accumulated Dep Cr.

As equipment is disposed, need to close accumulated dep.

30/6/2008
Cash Dr 10500, loss on sale dr 9500 and equipment cr 20000

Workings: After three years, equipment carrying amount is: 60000 – 30000 =
30000
Disposal value 20500
Loss on sale: 30000 – 20500 = 9500

10. Inventory Records:

FIFO, LIFO, Average, COGS, Highest ending inventory

Sample exercise is Class practice

More sample exercise:

Final Exam guideline 0222: Accounting Systems & Processes August 2022 online Page 7 of 10
 William Store bought and sold a line of dolls of inventory and has the following
records relating to its December 2018 inventory:

Date Item Quantity Unit Cost

(units)
1st July. Beginning inventory 15 $12
3rd July. Sale 8
9th July. Purchase 16 $14
11th July. Sale 12
15th July. Purchase 18 $20

Required:

William Store uses the perpetual inventory system, compute the cost of goods
sold under: (Hints: PSA5.3 Modelmania Ltd & PSA5.3: Zoom Ltd)
i. FIFO
ii. LIFO
iii. Average Cost
iv. Which method results in the highest cost of goods sold?

11. Understanding Income statement and statement of changes in equity and balance
sheet

Sample Exercise1:

On the 1 March 2013 Patrick set up a business as an accountant. Patrick has had several
years’ experience with a large CPA firm in Sydney and when he received a large inheritance
from a long lost relative, he decided now was the time to take the risk of being his own boss.
The following transactions occurred during his first month of operation.

1. Contributed $80,000 to the accounting practice.

1. Patrick agreed to rent a large office space from his good friend Bill

3. Patrick and his girlfriend spent the morning shopping for office furniture and equipment.
He managed to negotiate credit terms for 7 days and received a discount on the furniture
and equipment. The original price of was $29,500 but the invoice price is $25,000.

5 Purchased two computers, two printers and a modem for the business, paid $12,000
cash.

5 Paid $3000 for the first month’s rent on office space

7 Hire a personal assistance and agreed to pay $400 per week

9 Patrick completed a tax return for a desperate client and received $400 cash.

12 Paid for the office furniture and equipment

14 Paid his personal assistant $700

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25 Sent an invoice to a client for services rendered of $3475

21 Paid his personal assistant $300

30 Paid utilities expenses of $900

30 Withdraw from bank $1200 for personal use

Required:

a. Prepare the following statements for March;

An Income Statement

A Statement of Changes in Equity; and

A Balance Sheet

Sample exercise 2:

The trial balance of Susan Manufacturing Company at 30 June 2018 and the
data needed for the month-end adjustments follow:

Susan Manufacturing Company Limited

Adjusted Trial Balance

as at 30 June 2018
Account Debit Credit
Cash $ 7 000
Accounts receivable 18000
Prepaid rent 600
Supplies 800
Equipment 20000
Accumulated depreciation $ 5 000
Accounts payable 4000
Salary payable 1300
Unearned service revenue 1200
Capital 39500
Drawings 10000
Service revenue 15000
Salary expense 4 000

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 Rent expense 2000
Depreciation expense 800
Advertising expense 2500
Supplies expense 300
Total 66000 66000

Required
i) Prepare the statement of financial performance (income statement) for the
period ended 30 June 2018.
ii) Prepare the statement of changes in equity for the period ended 30 June
2018.
iii) Prepare the statement of financial position (balance sheet) as at 30 June
2018.

12. Understanding balance day adjustment entries.

Sample Exercise:
Prepare adjusting entries for Jolly Ltd as at 30 June for the following situations:
a. The Supplies account shows a balance of $1000, but a physical count shows only $400 if
supplies.
b. The company purchased a 1-year insurance policy for $6000 on 1 may, debiting Prepaid
Insurance.
c. On 1 June the company received $12000 from another entity which is renting a small
building from lasagne Ltd for 6 months. Lasagne Ltd credited Rent Revenue Received in
Advance.
d. Lasagne Ltd.’s accountant discovered that the company had performed services for a
client totalling $9000 but has not yet invoiced the client or recorded the transaction.
e. Lasagne Ltd pays employees $2500 per 5 day working week, and 30 June falls on a
Wednesday.
f. The company owns a van that cost $18,000 and has a useful life of 6 years (no residual
value). The company purchased the van in early April this year.

13. Financial statement analysis

The financial statements of Victor’s Natural Food include the following items:

Details Current Year ($) Preceding year ($)

Cash 25000 35000

Short term investments 10000 22000

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 Accounts receivables 55000 70000

Inventory 78000 68000

Prepaid expenses 12000 8000

Total current assets 180000 203000

Income statement:

Net credit sales 560000

Cost of sales 350000

Note: Current liability

$150000 for current year.

Required:

Calculate the following ratios for the current year:

a. Current ratio
b. Acid test ratio
c. Inventory turnover
d. Days in inventory
e. Day’s sales in accounts receivables
f. Goss profit margin

14. Fill in the missing items for each independent case. The cost of sales is 60 per cent
of revenue for each case. Show all workings.

Revenue – (cost of sales + other expenses) = Profit

Revenue Cost of Sales Other Expenses Profit

220000 63000
141000 35000
124500 15000
915000 86000
76200 32000

Total assets = Total liabilities + Share capital + Retained Earnings

Final Exam guideline 0222: Accounting Systems & Processes August 2022 online Page 11 of 10
 Total assets Total Liabilities Share capital Retained earnings
649000 150000 21000
641000 200000 181000
180000 75000 100000
645000 500000 50000
196000 400000 29000

Good Luck for Exam!

Final Exam guideline 0222: Accounting Systems & Processes August 2022 online Page 12 of 10