DIM1353 PRINCIPLES OF ACCOUNTING 2

Answer any FIVE (5) questions out of six (6) questions in the answer booklet.
Each question carries 20 marks. [100 MARKS]

QUESTION 1
Johnson has purchased a new machine to help speed up his production line. The machine cost
RM52,000 and is expected to last for five years. The machine has RM2,000 scrap value at the end
of its useful life.

Required:
You are required to calculate the depreciation of the machine, showing clearly the balance
remaining in the account at the end of each five years under:
(a) Straight line method (10 marks)
(b) Reducing balance method using 20% rate. (10 marks)

QUESTION 2
PART A
The trial balance of Tong Garden Enterprise was shortage on the credit side by RM4,274 at 31
December 2023 and a suspense account was opened to make it balance. Subsequent investigation
had found the following errors:
i. A Purchase account had under-cast by RM500.
ii. A Sales account had under-cast by RM3,400.
iii. The rent received account had been undercast by RM400.
iv. Discount received RM487 had been entered on the debit side in the account.
v. Purchases of lorry by cheque of RM43,000 had been completely omitted from the books.

Required:
(a) Prepare the journal entries necessary to correct the errors and omission. (10 marks)
(b) Prepare the Suspense Account. (5 marks)

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DIM1353 PRINCIPLES OF ACCOUNTING 2

PART B
The following information is from Tenby Tennis Club for the year ended 31 December 2023.

Balances as at Balances as at
1.1.2023 31.12.2023
RM RM
Subscriptions in arrears 140 230
Subscriptions paid in advance 180 260

During the year, cash receipts in respect of subscriptions amounted to RM3,220.

Required
Construct the subscriptions account for the Tenby Tennis Club for the year ended 31 December
2023. (5 marks)

QUESTION 3

The following information relates to Sales ledger control account and Purchase ledger control
account for the year ended 30 June 2023.

The opening balances as at 1 July 2022 were:

Sales ledger RM 14,300 (Dr)

RM 610 (Cr)

Purchase Ledger RM 350 (Dr)

RM 21,900 (Cr)

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DIM1353 PRINCIPLES OF ACCOUNTING 2

RM
Credit purchases 300,500
Credit sales 570,300
Cash sales 42,501
Cash Purchase 22,000
Discount received 3,800
Discount allowed 4,100
Return outward 2,620
Return inward 3,120
Bad debts 2,453
Cheque payment to supplier 297,420
Customer cheque dishonoured 530
Cheque received from debtors 482,780
Provision for doubtful debts 600
Amount paid in error to a supplier and refunded by him 5,320
Set-off balance Purchases ledger to Sales ledger 2,341
Debit balances in Purchase ledger as at 30 June 2023 511
Credit balance in Sales ledger as at 30 June 2023 150

Prepare:
(a) Sales Ledger Control Account (10.5 marks)
(b) Purchase Ledger Control Account (9.5 marks)

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DIM1353 PRINCIPLES OF ACCOUNTING 2

QUESTION 4
Following is the data for a factory for the year ended 31 December 2023.
RM
Inventory as at 1 January 2023:
- Raw materials 27,300
- Work in progress 6,500

Direct expenses 12,340

Direct labour 43,000
Factory utilities 17,300
Rent: Factory ¾, Office ¼ 12,000
Indirect labour 15,000
Purchases of raw materials 250,000
Factory equipment at cost 200,000

Additional information:
(a) Inventory as at 31 December 2023:
- Raw materials: RM20,320
- Work in progress RM6,890
- Finished goods RM25,400

(b) Direct labour accrued RM500.

(c) Depreciation of factory equipment is 20% on cost.

Required
From the data above, construct a manufacturing account for the year ended 31 December 2023.
(20 marks)

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DIM1353 PRINCIPLES OF ACCOUNTING 2

QUESTION 5
Danial, Ganesh, and Wong are partners. For the first year of trading, ended 31 December 2023,
the partners earned profit of RM100,500.
They shared profit and losses in the ration of Danial 2/5, Ganesh 2/5, and Wong 1/5.
The information of partnership is as follow:
Capital Drawing
Danial RM30,000 RM8,000
Ganesh RM30,000 RM12,000
Wong RM15,000 Nil

Following are the terms of partnerships:

- Interest on capital is at 8% per annum.
- Wong is an active partner and is paid salary of RM 36,000 annually.
- Drawings are charged interest at 6% per annum.

Required:
(a) Prepare the Profit & Loss Appropriation Account (10 marks)
(b) Current account for each partner. (8 marks)
(c) Capital account for each partner. (2 marks)

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DIM1353 PRINCIPLES OF ACCOUNTING 2

QUESTION 6
The following information is from ARFA Sdn. Bhd for the year ended 31 December 2023.

RM
Issued share capital – ordinary shares at RM1 each 500,000
Authorised share capital – ordinary shares of RM1 each 1,000,000
Loan notes 40,000
Building at cost 630,000
Motor vehicle at cost 74,000
Fixtures at cost 9,200
Retained profits 32,000
Non-current assets replacement reserve 30,000
Inventories 21,400
Account Receivables 10,300
General Reserve 50,000
Account Payable 13,700
Provision of Depreciation – Buildings 40,000
Provision of Depreciation – Motor vehicle 41,000
Provision of Depreciation – Fixtures 5,100
Bank 26,900

Required:
Prepare the Financial Position for ARFA Sdn. Bhd as at 31 December 2022.
(20 marks)

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