ACTIVITIES FOR ADDITIONAL KNOWLEDGE

CHAPTERS 1.1 / 1.2 & 1.3

TASK 1
1. Identify financial legislation that affects business organizations in your country.
2. Choose one charity in your local area. Consider how this charity meets its
financial requirements and complies with current financial legislation

TASK 2
Clark, a farmer, orders three new tractors direct from the manufacturer on 3 March. The
tractors are delivered to him on 19 March and his payment to the manufacturer is
received in full settlement on 1 April.
On what date should this sale be recorded by the tractor manufacturer? On what date
has the profit from the sale been realised? Give reasons for your answers.

TASK 3
Identity the accounting concept that applies to each of the following scenarios. Explain
your reasoning.

1. Mr Janis, a sole trader, has taken goods originally costing $450 from his retail
shop for his own personal use.
2. Pendle Delivery Service has good industrial relations and would like to record
this in the final accounts at a value of $25,000.
3. Dewar Decorating Supplies have purchased two doormats costing $5 each. They
are expected to last for a number of years and the business thinks it should
record them under non-current assets in the final accounts.
4. Prior to completing the final accounts for the local greengrocer shop, the
accountant has asked the owner, Mr Smithers, to prove that his business is likely
to continue for many years to come.
5. Mrs. Rogero, who owns a local retail store, would like to change the depreciation
method she uses for her fixtures and fittings. The change of method will increase
her net profit.
Finance For Managers : Anton Christon