SEMESTER A222

BKAN1013 BASIC ACCOUNTING

TUTORIAL 2 (TOPIC 4)
SUBMISSION DEADLINE: 6/6/2023

PART A: STRUCTURED QUESTIONS

1. Which of the following best describes adjusting entries?

A. Entries made to correct errors in the accounting records
B. Entries made to update accounts at the end of an accounting period
C. Entries made to record business transactions during the period
D. Entries made to close temporary accounts

2. Which accounts are typically involved in adjusting entries?

A. Assets and liabilities
B. Revenues and expenses
C. Equity and dividends
D. Income and expenses

3. When are adjusting entries usually recorded?

A. At the beginning of the accounting period
B. Throughout the accounting period
C. At the end of the accounting period
D. Adjusting entries are not necessary in accounting

4. Which of the following is an example of an adjusting entry?

A. Recording the sale of a product
B. Paying rent for the current month
C. Accruing unpaid salaries at the end of the period
D. Depositing cash into the bank account

5. How do adjusting entries affect the financial statements?

A. They have no impact on the financial statements
B. They increase both assets and liabilities
C. They only affect the income statement
D. They ensure that revenues and expenses are properly reported

6. What is the purpose of preparing an adjusted trial balance?

A. To determine the net income or net loss for the period
B. To verify that total debits equal total credits after adjusting entries
C. To calculate the ending balance of each account
D. To record closing entries for temporary accounts

7. Which accounts are included in the adjusted trial balance?

A. Only temporary accounts
B. Only permanent accounts
C. Both temporary and permanent accounts
D. Only revenue and expense accounts

8. How are accounts ordered in the adjusted trial balance?

A. Alphabetically by account name
 B. By the account numbers assigned to each account
C. By the account balances, starting with the largest
D. In the order they appear on the financial statements

9. If the adjusted trial balance shows total debits of $50,000 and total credits of $52,000, what
does it indicate?
A. The accounting records contain errors
B. There is a net loss of $2,000 for the period
C. The trial balance is in balance
D. Additional adjusting entries are needed

10. What is the next step after preparing the adjusted trial balance?
A. Closing temporary accounts
B. Preparing financial statements
C. Posting adjusting entries
D. Reconciling bank statements

PART B: STRUCTURED QUESTIONS

The unadjusted trial balance of GIGAMA Enterprise as at 31 December 2022 is as follows:

GIGAMA Enterprise
Unadjusted Trial Balance
31 December 2022
Debit Credit
RM RM
Cash 70,330
Accounts receivable 9,700 +7000
Office supplies 3,550 -2000
Prepaid insurance 6,720 -2240
Motor vehicle 120,000
Salaries payable 5,000 +5000
Accounts payable 13,800
Capital 105,000
Revenue 168,900 +7000
Salaries expense 60,700 + 5000
Other operating expenses 21,700
292,700 292,700

The followings are information related to year-end adjustments.

1. Salaries accrued on 31 December 2022 were RM5,000.
2. Insurance premium expired during the year were RM2,240. Ins exp dt 2240
3. Office supplies on hand on 31 December 2022 were RM1,550. Offi exp dt 2000
4. Unbilled customer at the end of the year amounted to RM7,000.
5. Motor vehicle is purchased on 1 July 2022. It is estimated that the vehicle has
expected useful life of 20 years and has RM10,000 scrap value. The business uses
straight line method to depreciate Depreciation
the asset. dt + 2750 Accumulated kt +2750
REQUIRED:

(a) Prepare the Statement of Profit or Loss and Other Comprehensive Income of
GIGAMA Enterprise for the year ended 31 December 2022.

(b) Prepare the Statement of Changes in Equity of GIGAMA Enterprise for the year
ended 31 December 2022

(c) Prepare the Statement of Financial Position of GIGAMA Enterprise as of 31

December 2022.
 GIGAMA Enterprise
Statement of Profit or Loss and Other Comprehensive Income
for the year ended 31 December 2022.
Descriptions Balance (RM)
Revenue （168,900 + 7,000） 175,900

(-) Expenses
Salaries Expense (60,700 + 5,000) 65,700
Other Operating Expenses 21,700
Insurance Expense 2,240
Office Expense 2,000
Depreciation Expense – Motor Vehicle 2,750
(94,390)
Net Income 81,510

GIGAMA Enterprise
Statement of Changes in Equity for the year ended 31 December 2022
Descriptions Balance (RM)
GIGAMA Enterprise, Capital, 1 Jan 2022 105,000
(+) Net Profit 81,510
GIGAMA Enterprise, Capital, 31 Dec 2022 186,510
 GIGAMA Enterprise
Statement of Financial Position as of 31 December 2022
Descriptions Balance (RM)
Assets
Non-Current Asset
Motor vehicle 120,000
(-) Accumulated Depreciation Expense - Motor Vehicle (2,750)
117,250
Current Asset
Cash 70,330
Account Receivable (9,700 +7,000) 16,700
Office Supplies (3,550 – 2,000) 1,550
Prepaid Insurance (6,720 – 2,240) 4,480
93,060
Total Asset 210,310

Equity and Liabilities

Owner’s Equity
Capital 186,510

Liabilities
Salaries Payable(5,000 + 5,000) 10,000
Account Payable 13,800
23,800
Total Owner Equity and Liabilities 210,310