plz solve this question asap!

[darenatto]

Dear all,
i m having difficulty in these questions.ur help in this regard will b highly appreciated.i have to submit this assignment tomorrow.my email [email protected]

Q1A car was purchased for $12000 on 1 april 1997 and has been depreciated at 20% each year straight line,assuming no residual value.the company policy is to charge full year’s depreciation in the year of purchase and no depreciation in the year of sale.the car was traded in for a replacement vehicle on 1 august 2000 for an agreed figure of $5000.
What was the profit or loss on the disposal of the vehicle for the year ended 31 december 2000?

Q2There is $100 in the cash till at the year end at F ltd,but the accountant has discovered that some cash has been stolen.At the beginning of the year there was $50 in the cash till n debtors were $2000.Total sales in the year were $230,000.Debtora at the end of the year were $3000.Cheques banked from credit sales were $160,000 and cash sales of $50000 have been banked.
How much cash was stolen during the year?

Q3A ltd has an item in stock which cost $1000 n can be sold for $1200.however,before it can be sold it will require to be modified at a cost of $150.the expected selling cost of the item are an additional $100.
How should this item be valued in stock?

Q4The net profit percentage in a company is 12% and the asset turnover ratio is 2.what is the return on capital employed?

Q5The following information was extracted from the balance sheet of Z ltd at 31 dec 2002
2002 2001
stock $ 100,000 $140,000
debtors 150,000 130,000
trade creditors 125,000 115,000
other creditors 60,000 75,000

what figure should appear as part of the cash flow statement for the year ended 31 dec 2002?

Q6On 1 oct 2002,the debtors balance at G ltd was 80,000.a summary of the transactions in the month of oct is set out below
Cheques received $100,000
Contra creditors 6,000
Sales 90,000
Returns inwards 4,000
Discounts allowed 10,000
The debtors balance at 31 oct was?

Q7The following information relates to NBV ltd for the year ended 31 july 2003.


direct materials 160,000
direct labour 200,000
prime cost 360,000
carriage outwards 80,000
depreciation of delivery vehicles 30,000
factory indirect overheads 450,000
increase in work-in-progress stock 75,000
decrease in stock of finished goods 55,000

what would b the factory cost of goods completed for the year ended 31 july 2003?

Q8Information from the Balance sheet of a company is as follows

31 august 2003 31 august 2002
stock 20,000 14,000
trade 16,000 18,000
debtors 12,000 10,000
48,000 42,000
trade creditors 14,000 17,000
34,000 25,000

company is preparing the cash flow statement for the year ended 31 august 2003.in relation to the items above,what should be the net adjustment to operating profit in order to determine the net cash flow from operating activities?

Adeduct $1,000
Bdeduct $2,000
Cdeduct $7,000
Dadd back $1,000

[kamranACA]

Q1A car was purchased for $12000 on 1 april 1997 and has been depreciated at 20% each year straight line,assuming no residual value.the company policy is to charge full year’s depreciation in the year of purchase and no depreciation in the year of sale.the car was traded in for a replacement vehicle on 1 august 2000 for an agreed figure of $5000.
What was the profit or loss on the disposal of the vehicle for the year ended 31 december 2000?

SUGGESTED ANSWER

Straight line method is to be used. I assume that accounting year starts from january and ends in december. This way depreciation will be charged for 1997, 1998 and 1999. No depreciation will be charged for 2000 as it is the deletion year where no depreciation has to be charged as per company's policy.

Three years depreciation comes to 7,200$ (@2400$ per year).

Written down value as per record would be = 12000$ - 7200$ = 4800$

The car was finally sold during year 2000 at 5,000$.

Gain on disposal would be = Sale value at disposal - written down value at disposal
= 5,000$ - 4800$
= 200$

Note

-There is no information about the fair value of vehicle traded against this car.
-IAS 16 does not allow charging full year's depreciation in the year of addition and nil depreciation in the year of deletion.

[kamranACA]

Q2There is $100 in the cash till at the year end at F ltd,but the accountant has discovered that some cash has been stolen.At the beginning of the year there was $50 in the cash till n debtors were $2000.Total sales in the year were $230,000.Debtora at the end of the year were $3000.Cheques banked from credit sales were $160,000 and cash sales of $50000 have been banked.
How much cash was stolen during the year?

SUGGESTED ANSWER

It is assumed that cash plus credit total sales = 230000$ (in which break up of cash sales and credit sales is not known.)

We calculate credit sales by following reconciliation


Closing debtors = 3,000$
Add
Total cheques received against credit sales = 160,000$

Less
Opening debtors = 2,000$

=
Credit sales = 161,000$


NOW,

After knowing credit sales we can calculate cash sales as under

Cash sales = Total sales - credit sales

= 230,000$ - 161,000$

= 69,000 $


Now cash stolen can be determined by following reconciliation

Opening cash in hand/till = 50$

Add Cash sales = 69,000$

Less Cash deposited against cash sales = 50,000$

Less Closing cash in hand/till = 100$

=

Cash stolen = 18,950$

THEREFORE CASH STOLEN IS EQUAL TO 18,950$.

[kamranACA]

Q3A ltd has an item in stock which cost $1000 n can be sold for $1200.however,before it can be sold it will require to be modified at a cost of $150.the expected selling cost of the item are an additional $100.
How should this item be valued in stock?

SUGGESTED ANSWER

Stocks /inventories have to be valued at lower of cost or net realisable value (NRV).

NRV means the estimated selling price less costs incidental/necessary to make such sales.

In above case, historical cost of the item = 1000$

NRV is as under

Selling price is expected = 1,200$

Less
Modification cost to be incurred to fetch above sale pric = 150$
and,
Additional selling costs to make the sale = 100$

=

NRV = 950$


Since inventories have to be valued at lower of Cost or NRV, therefore NRV in above case is lesser than the cost i.e. 950 $ against 1000 $ cost.

Accordingly, this item will be valued at 950$.

The difference of 50 $ between cost and NRV will be charged to profit and loss account as part of cost of sales.

[kamranACA]

Q4The net profit percentage in a company is 12% and the asset turnover ratio is 2.what is the return on capital employed?

SUGGESTED ANSWER

Net profit ratio = Net profit / Total sales

Asset Turnover ratio = Total sales / Total assets

Now,

Return on capital employed = Net profit ratio x Asset turnover ratio

= 12% x 2
= 24%

Return on capital employed is 24 %.


Note

It is not told in question that whether the profit was before or after interest. Further, it was also not mentioned that whether the asset turnover ratio was calculated on NET ASSETS or TOTAL ASSETS.

Assumption

I assumed that if asset turnover ratio is based upon total assets then the profit taken for net profit ratio was also before all interest charges.

Regards,

Kamran.

[kamranACA]

Q5The following information was extracted from the balance sheet of Z ltd at 31 dec 2002
2002 2001
stock $ 100,000 $140,000
debtors 150,000 130,000
trade creditors 125,000 115,000
other creditors 60,000 75,000

what figure should appear as part of the cash flow statement for the year ended 31 dec 2002?

SUGGESTED ANSWER
2002

(Increase)/decrease in current assets

stock 40,000$
debtors (20,000$)

Increase/(decrease) in current liabilities

trade creditors 10,000$
other creditors (15,000$)

NET CASH FLOW = 15,000$

THERE WOULD BE A POSITIVE CASH FLOW OF 15,000$ IN CASH FLOW STATEMENT.

[kamranACA]

Q6On 1 oct 2002,the debtors balance at G ltd was 80,000.a summary of the transactions in the month of oct is set out below
Cheques received $100,000
Contra creditors 6,000
Sales 90,000
Returns inwards 4,000
Discounts allowed 10,000
The debtors balance at 31 oct was?

SUGGESTED ANSWER

Opening balance = 80,000$
Add
Sales net of sales return {90,000-4000) = 86,000$

Less

Cheques received = 100,000$
Contra creditors = 6,000$
Discount allowed = 10,000$

=

Closing balance of debtors as at 31 October = 50,000$

THE CLOSING DEBTORS WOULD BE OF 50,000$.

[kamranACA]

Q7The following information relates to NBV ltd for the year ended 31 july 2003.

direct materials 160,000
direct labour 200,000
prime cost 360,000
carriage outwards 80,000
depreciation of delivery vehicles 30,000
factory indirect overheads 450,000
increase in work-in-progress stock 75,000
decrease in stock of finished goods 55,000

what would b the factory cost of goods completed for the year ended 31 july 2003?

SUGGESTED ANSWER

FACTORY COST OF COMPLETED GOODS

Direct materials 160,000

Add

Direct labour 200,000

Add

Factory indirect overheads 450,000

Less

Increase in work-in-progress stock (75,000)

Add

Decrease in stock of finished goods 55,000

=

FACTORY COST OF COMPLETED GOODS 790,000

THEREFORE,

FACTORY COST OF COMPLETED GOODS IS 790,000 (CURRENCY UNITS ARE NOT KNOWN).

NOTES

-FOLLOWING ARE SELLING/PERIODIC COSTS AND WILL BE CHARGED TO PROFIT AND LOSS ACCOUNT DIRECTLY. THESE CANNOT BE ABSORBED IN STOCKS VALUES.

Carriage outwards 80,000
Depreciation of delivery vehicles 30,000


-PRIME COST IS THE TOTAL OF DIRECT LABOUR AND DIRECT MATERIAL COST, THEREFORE, IT WAS ALSO NOT RELEVANT BECAUSE BOTH COMPNENTS ARE SEPARATELY TAKEN IN THE ANSWER.

[kamranACA]

Q8Information from the Balance sheet of a company is as follows

31 august 2003 31 august 2002
stock 20,000 14,000
trade 16,000 18,000
debtors 12,000 10,000
48,000 42,000
trade creditors 14,000 17,000
34,000 25,000

company is preparing the cash flow statement for the year ended 31 august 2003.in relation to the items above,what should be the net adjustment to operating profit in order to determine the net cash flow from operating activities?

Adeduct $1,000
Bdeduct $2,000
Cdeduct $7,000
Dadd back $1,000

CLARIFICATION REQUIRED

YOUR QUESTION IS NOT CLEAR AS SOME FIGURES SO NOT SHOW THE NOMENCLATURE OF THE BALANCES.

However, it is very simple to solve this question. Note down the tip.

You have to calculate differences of balances from 31 august 2002 to 31 august 2003. Some differences would show increase and some would show decrease in balances. For example if year 2002 balance is less and year 2003 balance is higher, an increase is shown. And if year 2002 balance is more and year 2003 balancea decrease will be shown.

TIP IS AS UNDER

- For assets all increases will be deducted and all decreases would be added.

- For liabilities all decreases will be added and all increases will be deducted.

THE NET FIGURE OF ALL THE ABOVE WILL BE THE NET CASH FLOW FIGURE.

hope you will be benefited from these solutions.

Regards,

Kamran.

[Cool Lioness]

Mr. kamran did this guy Darenatto thanked you for your efforts or not?

[kamranACA]

Dear,

This never happens in Pakistan so I dont ever expect it.

I normally dont answer such questions as in my view this forum is not created for these purposes. We should discuss professional issues in various sub-forums except GENARAL. These answers were just to accomodate his assignment in emergency.

Regards,

Kamran.