Level III

Project 3
Unit of com
Process payroll
Payroll data for muktar trading for the month hidar 30, 2005 is persecuted below. The
company pays salary at employee’s bank account every month.

Name of employee Position Basic Allowance Over Time

salary

0 Aster kebede Cashier 3,400 450 180

1

0 Susina ayele Manager 6,700 650 360

2

0 Hirut taye Supervisors 8,000 850 190

3

0 Getu tadesse Accountant 1,500 1000 560

4

Additional information
 Allowance is not taxable for employees
 All employees are permanent and worked hours per week.
 Employer and employees are expected to contribute basic 11% and 7% to
pension
 The employer pays birr 20 for bank for each employee every month
Task 1: prepare payroll document/register sheet as of hidar 30, 2005.
Task 2. Calculate pension contribution, income taxes and services charges.
Task 3. Pass accessary journal entries
 Project 4
Unit of competency covered: balance cash holdings
The following data pertain
1. Balance per bank statement dated march 31,2006 is br.8900
2. Balance of the cash account on the company’ book is br.8918
3. The br. 2600 deposit of march31 was not shown on the bank statement.
4. Of the checks recorded cash disbursement in march, some checks totaling br.
2100 have not yet cleared the bank
5. Service and collection charge, br. 20
6. The bank erroneously charge the Nun company account for br. 400 checks of
another company.
7. The bank credit’s the company’s account with br. 2000 proceeds of non-
interest bearing note collected for the company.
8. A customer’s check for br. 150 marked NSF.
9. As directed the bank paid and charge to the company account a br. 1015 non-
interest bearing note of Nou Company. The has not yet recorded this payment.
10.A cash receipt of br. 263 was recorded in cash receipt journal as br.236.
11.The bank credited the company account for br.40 on interest earned on the
company’s checking account.

Instructions

Task1. Prepare bank reconciliation for Nun Company, at March 31.

Task2. Prepare necessary journal entries

Task 1
Nun Company
Bank reconciliation
March 31, 2006

Balance bank------------------------br. 8900 Deposit in transit-----br.2600

Add Error--------------------br. 400
Subtotal -----------------------------br.3000 Note collection------br. 2000
Error ------------------br. 27
Interest----------------br. 40
Subtotal ------------------------------br.2067
Less Less
Outstanding check-----------------br.2100 Service charge ----------br. 20
NSF-------------------------br.150
Adjusted balance-------------------br.9800 Note payable-------------br.1015
Balance depositor------------------br.8918 Subtotal ------------------------------br.1185
Add Adjusted balance-------------------br.9800

Task 2 Journal Entries

1. Note receivable 2. Error
Cash--------2000 Cash --------------27
Note Receivable------2000 Note Receivable---------27
3. Interest 4. Service Charge
Cash ------40 miscellaneous expense-----20
Interest revenue------40 cash ---------------------------20
5. NSF 6. Note payable
Account payable-------150 note payable -----------1,015
Cash------------------------150 cash ---------------------1,015
Project 1
On Hamle 1, 2003 MOFED notify the release of br. 285,000 budget to your organization as working
capital. You organization will receive one bank advice at end of each day from bank for daily transfer
credited your bank account for check payment.

On the other day, your organization issued a check of br.150, 000 supplies, br. 100,000 for purchase
of stationary, br. 35,000 for purchase of tiers.

Task1. Record expenditure and transfer to bank account.

 1. Record the entry for the expenditure at notification date and check issuing day.
2. Record the transfer up on the receipt of the bank credit advice.

Task2. Analyzing and journalizing transactions for company

Suppose Addis Company sells products with term of sale 2/10, n/30 FOB destination. The following
transactions occurred during the year 2015:

1. On march 30, DAT company purchase a product from the company amounted to br. 230,000
2. On April 23, XY Company purchases a machine for br. 500,000.Transportion cost is br.5,000 and
insurance premium is br. 10,000
3. On April 6, DAT Company paid 1/4th of its purchase of March 30.
4. On April 30, XY Company paid 3/4th of its purchase of April 23.
5. On April 20, DAT Company paid the remaining balance of its purchase on account.
6. On May 20, XY Company paid the remaining balance of its purchase on account.

Task3. Preform bank reconciliation

Instruction: indicate the following reconciling items to the correct position in the bank
reconciliation

1. Check printing charge

2. Outstanding checks
3. A deposit in transit.
4. Interest earned during the month by the company.
5. Non- sufficient fund.
6. Bank service charges for June.
7. The bank erroneously records the check of another company to XY Company.
8. The company’s accountant overlooked record one deposit made to bank.
XY Company

Bank reconciliation

June 30
Balance per bank statement------xxx Balance per company book -------------xxx
Add (1) Add (3)
Less (2) Less(4)
Adjusted cash balance -------------xxx Adjusted cash balance -------------------xxx

Project 1
On Hamle 1, 2003 MOFED notify the release of br. 285,000 budgets to your organization as
working capital. You organization will receive one bank advice at end of each day from bank for
daily transfer credited your bank account for check payment.

On the other day, your organization issued a check of br.150, 000 supplies, br. 100,000 for
purchase of stationary, br. 35,000 for purchase of tiers.
Task1. Record expenditure and transfer to bank account.

1. Record the entry for the expenditure at notification date and check issuing day.

2. Record the transfer up on the receipt of the bank credit advice.

Task2. Analyzing and journalizing transactions for company

Suppose Addis Company sells products with term of sale 2/10, n/30 FOB destination. The following
transactions occurred during the year 2015:

1. On March 30, DAT company purchase a product from the company amounted to br. 230,000

2. On April 23, XY Company purchases a machine for br. 500,000.Transportion cost is br.5,000
and insurance premium is br. 10,000

3. On April 6, DAT Company paid 1/4th of its purchase of March 30.

4. On April 30, XY Company paid 3/4th of its purchase of April 23.

5. On April 20, DAT Company paid the remaining balance of its purchase on account.

6. On May 20, XY Company paid the remaining balance of its purchase on account.

Task3. Preform bank reconciliation

Instruction: indicate the following reconciling items to the correct position in the bank
reconciliation

A. Checks written not cleared the bank

B. bank service charge

C. deposit made on June 30 that did not reach the bank.

D. upon reviewing cash receipts it was discovered that the clerk had neglected to post one

Deposit to cash account

E. Non- sufficient fund (NSF)

F. the bank erroneous of debited check of another company to the bank account.

G. The company’s accountant was credited for interest earned during the year.

Task 3 Project 1

XY Company
Bank reconciliation
 June 30

Balance per bank statement------xxx Balance per company book -------------xxx

Add (1) C,F Add (3) D,G

Less (2) A Less(4) B,E

Correct cash balance---------------xxx Adjusted cash balance -------------------xxx

Journal Entries
D = sales G = interest
Cash -----------xxx cash --------xxx
Sales--------------xxx interest income-------xxx
B = Service charge E =NSF
Miscellaneous expense-----xxx A/receivable ------xxx
Cash -------------------------xxx Cash ------------------xxx

Task 1 Project 1
1. Supplies exp. ---------150,000
Stationary exp. ------100,000
 Tires exp. ---------------35,000
Cash at bank ------------285,000
2. Transfer
Cash at bank ------------285,000
Transfer bank ------------285,000
Task 2.
Seller buyer
1.March 30, Addis co. March 30, DAT Company
A/Rec. –DAT CO. ---------230,000 purchase ------230,000
Sales ------------------------230,000 A/pay. Addis Co. ---------230,000
2.April 23, Addis co. April 23,XY Company
A/Rec. XY-Co. 500,000 purchase ---------500,000
Sales--------500,000 A/pay. Addis C----------500,000
Transportation ---------50,000
Insurance ----------------10,000
Cash------------------15,000
3. April 6, Addis co. April 6, DAT Company
Cash-----------------56,350 Paid amount 230,000 x 1/4 =57,500
Sales discount-------1,150 Count the day March 30, 31 1, 2, 3,4,5,6 = 8day
A/Rec-DAT Co. ---------- 57,500 pay before 10 day (2/10 n/30)
Discount = 57,500 x 2% = 1,150.00
A/pay Addis Co. -------57,500
Cash ------------------------------56,350
Purchase discount -------------1,150

4. April 30, Addis co. April 30, XY Company

Cash-----------------367,500 Amount paid = 500,000 x ¾ = 375,000
Sales discount-------7,500 Count the day April 23, 24, 25, 26, 27, 28, 29, 30
= 8day
A/Rec. XY Co ----------375,000 Pay before 10 day (2/10 n/30)
Discount =375,000 x 2% = 7,500
A/pay Addis Co. ------------375,000
Cash ---------------------------367,500
Purchase discount ------------7,500
5. April 20, Addis co. April 20, DAT Company
Cash --------172,500 remaining amount = 230,000 – 57,500
A/Rec. XY Co. -----172,500 172,000
A/pay. Addis Co. ------172,500
Cash------------------172,500
6. May 20, Addis co. May 20, XY Company
Cash --------125,000 remaining amount = 500,000 – 375,000
A/Rec. XY Co. -----125,000 125,000
A/pay. Addis Co. ------125,000
Cash------------------125,000
 Project Two
Task 1: record transaction and post to the necessary account

Date Transactions

Hamle 8 A check no.55 for br. 5000 is written as advance payment for uniforms and clothing
to Akaki Garment for the sub agency. The total costs are agreed at br.7000

Hamle 10 The following checks are written for payment:

a. Check No.89 br. 600 for electricity
b. Check No.78 br. 300 for telephone bill
c. Check No.65 br. 300 for water and post

Hamle 14 Br. 2000 is paid to purchaser to buy tires for the organization cars

Hamle 18 The purchaser submits an invoice for the br. 1950 and goods receiving note (GRN)
and refunds the balance of br.50 in cash to the cashier to settle the above
transaction.

Hamle 19 ABC governmental enterprise advertises for the bidders which are capable of
supplying office furniture and are instructed to submit cash of Bid security amount
br. 2000 each (assuming that the bidders are 10 in number, record the payment of
the bid security by the bidders)

Hamle 23 Bank credit advice is received for amounts totaling br.7250 for the notes collected
by bank.

Hamle 25 The cashier requests petty cash replenishment by providing invoices for br. 200 of
miscellaneous, br. 1910 of gasoil and br.860 of perdiem and the remaining balance
of br.11 out of her petty cash amount br.3000. Record the transaction including the
replenishment.

Hamle 30 The company returned the bid security bond to the bidders which did not fulfill the
bidding requirements by accepting only three of the bidders at all after the bidding
process is completed.
Project Three/ prepare financial reports
Task 1 prepares income statement in good form for June 2009 which is the first month of the
operation. Ignore taxes.
Assume on June 1, 2009, ABC company, VAT registered company, was started with br. 100,000
invested by the owners as contributed capital. On June 30, the accounting record contains the
following amounts;
Accounts payable , br. 100 Office supplies br. 800
Account Receivable, br. 3,900 Rent expense br. 1,500
Cash br. 2,500 Salary expense br. 2,000
Contributed capital br. 50,000 Supplies expense br.100
Consulting fees earned br.10,500 Telephone expense br. 200
Dividends declared br. 2,100 Office equipment br. 24,100

Project Two
Hamle 8 Hamle 10
Prepaid uniform---------5,000 Electric Exp. -------600
Cash -----------------------5,000 Telephone Exp. ----300
Water Exp. ----------300
Cash -----------------------1,200
Hamle 14 Hamle 18
A/Rec. purchaser---2,000 invoice GRN =1,950, cash =50
Cash ------------------- 2,000 Tries (Maintenance Exp.)---------1,950
Cash----------------------------------------50
A/Rec. purchaser ---------------2,000
Hamle 19 Hamle 23
Cash--------20,000 Cash-------------7,250
Bid pay. ---------- 20,000 N/Rec. ---------------------7,250
2000 x 10 br. = 20,000
Hamle 25 Hamle 25
Miscellaneous Exp. ------200 OR Miscellaneous Exp. ------200
Gasoil Exp. ---------------1,910 Gasoil Exp. ---------------1,910
Perdiem exp. ---------------860 Perdiem exp. ---------------860
Petty Cash -------------2,970 Cash short/ over ------------19
Petty Cash -------------2,989

Hamle 30
Bid pay. ------------14,000
Cash ----------------14,000

Project Three
Task1
ABC Company
Income Statement
For the month ended June 30,2009
Revenue
Consulting fees earned------------------------------------------------------ br.10, 500
Less Expense
Salary Expense -------------br.2 000
Rent expense----------------br.1, 500
Supplies Expense-----------br. 100
Telephone Expense -------br. 200
Total Expense -------------------------------------------------------------------br. (3,800)
Net income------------------------------------------------------------------------br.6, 700
 Project 1
The financial records of Alem Tsege Share Company Shows the following data as of
sene 30, 2003
Sales ------------------------------------------------200,000.00
Sales return and allowance ----------------------4,000.00
Sales discounts --------------------------------------6,000.00
Costs of goods sold---------------------------------40,000.00
Operating expense ---------------------------------30,000.00
Interest expense --------------------------------------3,000.00
Assume that entertainment and uncollectible accounts expense includes Br.2, 000
and 6,000 respectively. The company expected to pay 30% of business profit tax
during the year. The doard of director declared that 60% of income after income tax
to be distributed to shareholders as dividend.
Task 1.1 prepares income statement for tax purpose as of sene 30, 2003
Task 1.2 calculates business profit tax for the year?
Task 1.3 calculate dividends for the year
Task 1.4 calculates dividend income tax for the year
Task 1.5 calculate net dividends
 Task 1.1
Alem Tsege Share Company
Income Statement
Sene 30, 2003
Sales ----------------------------------------------------------------------200,000.00
Less Sales return and allowance ----------------------4,000.00
Sales discounts --------------------------------------6,000.00
Net sales-----------------------------------------------------------------190,000.00
Less Costs of goods sold------------------------------------------------ (40,000.00)
Gross profit ---------------------------------------------------------------150,000.00
Less Operating expense ------------------------------------------------ (30,000.00)
Less Interest expense ---------------------------------------------------- (3,000.00)
Income before tax --------------------------------------------------------117,000.00
Add non doubtful exp. -------------------------------------------------------8,000.00
Income before tax----------------------------------------------------------125,000.00
Business tax (125,000 *30%) ------------------------------------------- (37,500.00)
Net income -------------------------------------------------------------------87,500.00

Task 1.2
125,000.00 X 30% = 37,500
Task 1.3
87,500.00 – 8,000 = 79,500
79,500 x 60% = 47,700.00
Task 1.4
47,700.00 x 10/100 = 4,770
Task 1.5
47,700 - 4,770 = 42,930.00

Project 2
Assume that ABC agriculture enterprise engaged in import and export trade activities. The enterprise has at
its bank account Br.1, 500,000 at the beginning of the month. The enterprise received at the bank account
from its customers USD 30,000 and EURO 100,000. The enterprise import materials at FOB value USD 50,000
Br.20, 000, 60,000 and 80,000 for insurance, transport (freight) and customs duty respectively.
Buying Selling
USD 19.5 20
EURO 26 26.5
Required
Task 2.1 calculate the total cost of materials assuming that the enterprise charged 3% by the bank services
Task 2.2 calculate the total amount of fund transferred to the enterprise account BIRR
Task 2.3 calculate the cash balance available at the enterprise bank account assume that there is no
withdrawal except payment for purchase during the month
Task 2.1 paid amount
500,000*20% = 1,000,000
1,000,000*3% = 30,000
Total cost 1,000,000 + 30,000 + 20, 000 + 60,000 + 80,000 = 1,190,000
Task 2.2 Total fund transfer
30,000*19.5 = 585,000
100,000*26 = 2,600,000
Total fund transfer = 585,000 + 2,600,000 = 3,185,000

Task 2.3 Current cash balance (ending balance) = beginning balance + fund transfer - paid amount
Current cash balance = 1,500,000 + 3,185,000 – 1,190,000 = 3,495,000
Project 3

Zona trading engaged in importing commercial vehicles from abroad and sold the vehicles with after
sales service. On March 1, 2015 the company’s cash balance indicates a bank account balance of br.
12,250,075. During the month the company also imported 20 units of vehicles from German at FOB
value of Euro 40,000 and br. 31,800.00 for insurance and br.88, 200.00 for freight cost.
The following exchange rate and tax rates are applicable:
Buying selling
Euro 21.57 22
VAT, 15%, Excise tax -30%, Custom duty-35%, withholding tax-3% and sur. Tax, 10%
Required
1. Calculate the total cost of imported vehicles before duty and tax payable assuming that the
enterprise charged 1.5% for service charge on FOB value by bank
2. Calculate total duty and tax payable at the time of import
3. Based on the above data, determine the account balance in bank at end of the month.
4. Determine total cost of each imported vehicles
 Task 1. Total cost of imported vehicles before duty and tax payable
FOB value Euro 40,000 x 22 ------------------------------------880,000.00
Insurance-----------------------------------------------------------------31,800.00
Freight cost--------------------------------------------------------------88, 200.00
CIF ------------------------------------------------------------------------1,000,000.00
Service charge (880,000.00 x 1.5 %) ------------------------------13,200.00
Total cost each vehicle ----------------------------------------------1,013,200.00
Task 2. Total duty and tax payable at the time of import
Custom duty = 1,000,000 x 35% = 350,000.00
Excise tax = (1,000,000 + 350,000) x 30% = 405,000.00
VAT = (1,000,000 +350,000 +405,000) x 15% = 1,755,000 x 15% = 263,250.00
Sure tax = (1,000,000 +350,000 +405,000+263,250) x 10% = 201,825.00
Withholding = 1,000,000 x 3% = 30,000
Total duty & tax payable= 350,000 + 405,000 + 263,250 + 201,825 + 30,000 + 13,200 = 1,263,275.00
Task 3. Determine the account balance in bank at end of the month
Total Paid cash amount = CIF + Duty & tax pay. = 1,000,000.00 + 1,263,275.00 =
2,263,275.00
 Ending balance = beginning balance – Total paid cash amount
12,250,075.00 – 2,263,275.00 = 9,986,800.00
Task 4. Determine total cost of each imported vehicles
Paid cash amount each vehicles = Total paid cash amount - VAT – Withholding
20 unit vehicles
(2,263,275 -263,250 – 30,000)÷20 = 1,970,025÷20 = 98,501.25 OR
2,263,275.00 ÷ 20 = 113,163.75

Project 4
Given:
The following data relates to ABC Company’s for the month of Ginbot 2007. The accountant of the company
prepares payroll and details about basic salary, overtime and other deductions for the month of ginbot 2007are
given below;

s/n Name of employee Basic Transport House Overtime

salary allowance allowance Earnings
01 Daniel 1400 600 850
02 Selam 2500 800 700
03 Goitom 13000 450 600
04 Meseret 5000 1200 750 20hr.(holiday)
05 Habtom 4600 20hr.(holiday)
06 beshatu 5800 20hr.(1.25)
Additional information
1. All employees are permanent and worked 40 hours per week
2. Transport allowance of all employees not taxable
3. Desert allowance is 20% of basic salary for all employees(not taxable)
4. Pension contribution is 7% and 11%
Task 1. Prepare payroll register sheet for the month Ginbot 30, 2007
Task 2. Show all necessary journal entries required on Ginbot 30, 2007

Project 3
Assume that you are an employee of commercial bank of Ethiopia and assigned in credit
section in order to process customers credit application and handle foreign currency
requests. Accordingly, you are required to perform the following tasks;
Task 3.1. kaki flour factory plc. is a manufacturing company which has established for the production
and
Distribution of flours. The PLC wants to establish a credit relationship with your bank. But
before that, the PLC wants to necessary information about your section. What information
do you provide for the PLC?
Task 3.2. The PLC has fulfilled the required documents and your bank approved a manufacturing
loan of br. 1,000,000 to be repaid in one year at lump sum repayment with an annual
interest rate of 9.5%. Calculate the total amount (principal plus interest) to be repaid by the
PLC.
Task 3.3.the PLC also required 10,000 US Dollar from your bank for importing spare parts to its
factory machinery. Calculate the amount of money that is required by the PLC in terms of
Ethiopian Birr’s
Buying Selling
USD 22 22.60
EURO 25 25.90

Project 5
Habtamu, Soliyana, and Hanan are partners and share income and losses in the ratio of 5:3:2. The
decided to liquidate the partnership on sene 30, 2007. After temporary accounts are closed the
following permanent accounts have a balance on sene 30, 2007
Accounts Balance
Cash 10,000
Non cash assets 100,000
Liabilities 26,000
Habtamu 25,000
Soliyana 30,00
Hanan 29,000
Consider the following assumptions:
a. All non-cash assets were sold for br. 150,000.00
b. All non-cash assets were sold for br. 70,000.00
Required:
1. Prepare statement of partnership liquidation
2. Record the necessary journal entries.
a.1 Gain = non cash – sold 150,000 – 100,000 = 50,000.00
50,000 x 5/10 = 25,000
50,000 x 3/10 = 15,000
324,000 x 2/10 =10,000

Habtamu, Soliyana, and Hanan - partnership

Statement of partnership liquidation

Sene 30, 2007

Description Cash Non Cash Liability Habtamu - Soliyana - Hanan -
Capital Capital Capital

Balance 10,000 100,000 26,000 25,000 30,000 29,000

Realization non cash Asset 150,000 100,000 - 25,000 15,000 10,000

Balance 160,000 0 26,000 50,000 45,000 39,000

Payment of liability 26,000 - (26,000) - - -

Bal. 134,000 0 0 50,000 45,000 39,000

Final cash bal. to partner (134,000) - - (50,000) (45,000) (39,000)

Bal. 0 0 0 0 0 0

a.2. Task Journal Entries

1. Realization of non-cash asset
Cash ------------------------------150,000
Non cash asset--------------------------100,000
Gain realization-------------------------50,000

2. Distribution of loss to partners

Gain = non cash – sold 150,000 – 100,000 = 50,000.00

50,000 x 5/10 = 25,000
50,000 x 3/10 = 15,000
50,000 x 2/10 =10,000

Gain on realization------------------------50,000
Habtamu-capital ---------------------25,000

Soliyana-capital -----------------------15,000

Hanan-apital --------------------------10,000

3. Payment of liability

A/pay. ------------26,000
Cash -----------------------26,000
4. Final cash payments
Habtamu-capital -------------------50,000
Soliyana-capital --------------------45,000
Hanan-apital------------------------39,000
Cash -----------------------------------------134,000

b.1 loss = non cash – sold 70,000 – 100,000 = 30,000.00

 30,000 x 5/10 = 15,000
30,000 x 3/10 = 9,000
30,000 x 2/10 = 6,000

Habtamu, Soliyana, and Hanan - partnership

Statement of partnership liquidation

Sene 30, 2007

Description Cash Non Cash Liability Habtamu - Soliyana - Hanan -

Capital Capital Capital

Balance 10,000 100,000 26,000 25,000 30,000 29,000

Realization non cash Asset 70,000 100,000 - (15,000) (9,000) (6,000)

Balance 80,000 0 26,000 10,000 21,000 23,000

Payment of liability (26,000) - (26,000) - - -

Bal. 54,000 0 0 10,000 21,000 23,000

Final cash bal. to partner (54,000) - - (10,000) (21,000) (23,000)

Bal. 0 0 0 0 0 0
b.2. Task Journal Entries
1. Realization of non-cash asset
Cash ------------------------------70,000
Loss on realization--------------30,000
Non cash asset--------------------------100,000
2. Distribution of loss to partners
Loss = non cash – sold 70,000 –100,000 = 30,000.00
30,000 x 5/10 = 15,000
30,000 x 3/10 = 9,000
30,000 x 2/10 = 6,000

Habtamu-capital --------------25,000

Soliyana-capital ----------------15,000

Hanan-apital ----------------10,000

Loss on realization--------------------30,000
3. Payment of liability

A/pay. ------------26,000
Cash -----------------------26,000
4. Final cash payments
Habtamu-capital -------------------10,000
Soliyana-capital --------------------21,000
Hanan-apital------------------------23,000
Cash -----------------------------------------54,000
Project 4

Unit of competency covered: prepare financial report

Give

The financial records of Zelalem Manufacturing Company show the following data on December 31,
2014.

Gross sales -----------------------------------------------3,210,000

Beginning merchandising Inv. ---------------------------78,000

Ending merchandising Inv. -----------------------------248,000

Interest Expense --------------------------------------------64,000

Deprecation exp. --------------------------------------------78,000

Sales return & allowance-----------------------------------48,000

Repair & maintain Exp. -------------------------------------22,000

R&D Expenditure ------------------------------------------- 35,000

Lease payment ------------------------------------------------52,000

Management salary ----------------------------------------240,000

Material purchase -----------------------------------------2,425,000

Advertising Exp. -----------------------------------------------258,000

Required:

1. Calculate profit tax assuming the company is expected to pay 30%

2. Prepare income statement for the year.
Task 4.2

Gross sales ------------------------------------------------------------------------------------------3,210,000

Less Sales return & allowance--------------------------------------------------------------------- (48,000)

Net sales----------------------------------------------------------------------------------------------3,162,000

Less cost of goods sold

Beginning merchandising Inv. --------------78,000

Material purchase --------------------------2,425,000

Available for sales --------------------------2,503,000

Less Ending merchandising Inv. ------------248,000

Cost of goods sold ------------------------------------------------------------------------------------ (2,255,000)

Gross profit ------------------------------------------------------------------------------------------------907,000

Less expense

Interest Expense --------------------------------------------64,000

Deprecation exp. --------------------------------------------78,000

Repair & maintain Exp. -------------------------------------22,000

R&D Expenditure ------------------------------------------- 35,000

Lease payment ------------------------------------------------52,000

Management salary ----------------------------------------240,000

Advertising Exp. -----------------------------------------------258,000

Total operation Exp. ---------------------------------------------------------------------------------- (749,000.00)

Income before tax --------------------------------------------------------------------------------------158,000.00

Less profit tax (158,000 x30%) ------------------------------------------------------------------------- (47,400.00)

Net income ------------------------------------------------------------------------------------------------- 110,600.00

Task 4.1
 Profit ta x 158,000 x30% = 47,400.00

Project.1
Waliya capital goods finance plc. Is financial institutions in Ethiopia engaged in providing financial
activities for micro and small enterprise. The company has four staffs. For the month of megabit 2,
2007 the accountant prepare payroll and process the payment through bank account for each
employee. The following information used to prepare the payroll.
No Employee name Basic salary Over time
1 Zelalem Tesfahun Br. 600 Br. 150
2 Fikady Haile Br. 1000 Br.500
3 Soliyana Daniel Br. 3000 Br.300
4 Ayana Berga Br. 5000 Br. 200

Addition information
1. Credit association paid is 5% of basic salary
2. The company paid allowance 10% of basic salary for each employee
3. Allowance of each employee is taxable
4. Pension contribution is 11% employer and 7% from employee
5. All employee are permanent
6. Bank service charge for each employee is 10 birrs paid by employer
Task 1. Prepare payroll document for the month of megabit 2007
Task 2. Determine income tax, pension, credit association, service charge and net pay
Task 3. Record the necessary payroll entries for the month of megabit 2007
 Project.2
The following information pertains to ADA research and development plc.
- Balance per bank statement dated march 31,2015, is birr 4,204 balance of each account on the
company book as of march 31,2015, is birr 2,855
- Birr 500 receipt of march 31 did not appear on the bank statement
- The following checks issued by ADA research and development plc did not appear in the march’s
bank statement
 Ck. No 20 br. 300
 Ck. No 21 br. 250
 Ck. No 22 br. 238
- A note of br. 1,200 and interest of br. 25 were collected by the bank for ADA research and
development PLC and included with the bank statement as credit memo, and br. 150 debit
memo, for NSF, checks.
- Service and collection charge for the month were br.50
- Cash payment to supplies on account of br. 148 was erroneously recorded by depositor as
br. 184
Task 1 prepare bank reconciliation as of march 31, 2015
Task 1. Prepare the necessary journal entries.

ADA research and development plc.

Bank Reconciliation
March 31, 2015

Balance Bank statement------------------------- 4,204.00 Balance Depositor book record--------------------2,855.00

Add: Deposit in transit ----------------------------------- 500.00 Add: notes receivable------1,200.00
Interest--------------------25.00
Less: outstanding checks Errors --------------------- 36.00
Ck. No 20 br. 300
Ck. No 21 br. 250 Subtotal---------------------------------------------------------- 1,261.00
Ck. No 22 br. 238 Less: NSF CHECKS-------------- 150.00
Subtotal -----------------------------------------------(788.00) service charge----------- 50.00
Subtotal -----------------------------------------------------------(200.00)
Adjusted Balance ------------------------------------3,916.00 Adjusted Balance --------------------------------------------- 3,916.00

Task 2.
1. Note rec.
Cash --------------1,225.00
N/Rec. -------------------------1,200.00
Interest income ------------------25.00
 2. Error
Cash -------------------36.00
A/pay. -----------------------36.00

3. NSF

A/Pay. ----------------150.00
Cash------------------------150.00

4. Service charge

Miscellaneous Exp. ------------ 50.00

Cash -------------------------------50.00

Project.1 preparing financial reports and controlling accounts

1. The following trial balance of x company as of December 2014 don’t balance of number of reasons

Accounts description Debit Credit

Cash 3,752.00
Account receivables 5,683.00
Supplies 1,457.00
Prepaid insurance 100.00
Equipment 14,600.00
Notes payable 13,000.00
Account payable 2,960.00
x-capital 10,042.00
x-drawing 3,500.00
Sales 38,200.00
Wages expense 21,400.00
Rant expense 4,500.00
Advertising expense 200.00
Utility expense 900.00
Total 56,092.00 64,202.00
Reasons for trial balance in balance
A. The balance of cash was overstated by 1,000.00. less from cash 1,000.00
B. The cash respite of 210.00 was posted as debit to cash of 120.00. + to cash 90
C. Debit of 2,000.00 for a withdrawal by owner was posted as a credit to capital account.
to x drawing less to capital 2000 (+ x drawing)
D. The balance of 1,200.00 advertising expense was entered as 200.00 in the trial balance.
+1000 to advertising
E. A debit of 450.00 to account receivable account was not posted but posted correctly to
subsidiary ledger account +450 A/R
F. A return of 310.00 of defective supplies was erroneously posted as 130.00 credits to supplies.
less 180 from supplies
G. The balance of notes payable was overstated by 3000.00. less to N/P
H. An insurance policy acquired at a cost of 200.00 was posted as a credit to prepaid insurance.
 + 400p/insurance
I. Miscellaneous expense with a balance of 1,060.00 was omitted from trial balance
J. A credit of 710.00 in account payable was over looked during general ledger account and
subsidiary ledger reconciliation. +710 to A/P
K. A debit of 650.00 to account receivable was posted correctly but not posted to subsidiary ledger
customer account. not need to show trial balance
Additional information’s for adjusting entries
a. Inventory of supplies as of December 31,2014 shows 277.00
Supplies expense-------------------1000
Supplies-------------------------1000
b. Insurance expired for the period of 2014 is 350.00
Insurance expense -----------------350
Prepaid insurance -----------------350
c. Doubt full account for the period is 2% of the balance of account receivable = 6133 x 2% =
122.66

Doubtful account expense -----------------------122.66

Allowance doubtful account (A/R) -----------------------122.66

Required
Task1.1 Prepare adjusted trial balance as of December 31, 2014 as in interim financial report.
Task1.2 Record the necessary adjusting entries for the period and determine the balance of
each account
Task1.3 Prepare financial reports (INCOME STAMENT & BALANCE SHEET) as of December 31,
2014
Income Statement ------------------------ 7,667.34
Balance Sheet ----------------------------- 23,879.34
Owner Equity ------------------------------10,209.34

Task 1
After correction
X Company
Trial balance
December 31, 2014

Account Title Debit Credit

Cash 2,842.00
A/Receivable 6,133.00
Supplies 1,277.00
Prepaid insurance 500.00
Equipment 14,600.00
Note Payable 10,000.00
Account Payable 3,670.00
x-capital 8,042.00
x-drawing 5,500.00
Sales 38,200.00
Wages expense 21,400.00
Rant expense 4,500.00
Advertising expense 1,200.00
Miscellaneous expense 1,060.00
Utility expense 900.00
Total 59,912.00 59,912.00

A. Inventory of supplies as of December 31, 2014 shows 277.00

Supplies expense-------------------1000
Supplies-------------------------1000
B. Insurance expired for the period of 2014 is 350.00
Insurance expense -----------------350
Prepaid insurance -----------------350
C. Doubt full account for the period is 2% of the balance of account
Receivable = 6133 x 2% = 122.66
Doubtful account -----------------------122.66
Doubtful account expense (A/R) -----------------------122.66
X Company
Adjusted Trial balance
December 31, 2014

Account Title Debit Credit

Cash 2,842.00
A/Receivable 6,133.00
Allowance for doubtful 122.66
Supplies 277.00
Prepaid insurance 150.00
Equipment 14,600.00
Note Payable 10,000.00
Account Payable 3,670.00
x-capital 8,042.00
x-drawing 5,500.00
Sales 38,200.00
Wages expense 21,400.00
Rant expense 4,500.00
Uncollectable Expense 122.66
Supplies Expense 1,000.00
Insurance Expense 350.00
Advertising expense 1,200.00
Miscellaneous expense 1,060.00
Utility expense 900.00
Total 60,034.66 60,034.66

X Company
Income statement
For the year ended December 31, 2014

Revenue
Sales -------------------------------------------------------------------------------- Br. 38,200.00
Expense
Wage exp.------------------------------------------------------------ 21,400.00
Uncollectable -----------------------------------------------------------122.66
Rent Exp.---------------------------------------------------------------4,500.00
Adverting Exp.--------------------------------------------------------1,200.00
Supplies Exp.----------------------------------------------------------1,000.00
Insurance Exp.-----------------------------------------------------------350.00
Miscellaneous Exp.--------------------------------------------------1,060.00 (Br.30,532.66)
Utility Exp.---------------------------------------------------------------900.00 Br. 7,667.34
Total Expense --------------------------------------------------------------------
Net Income -----------------------------------------------------------------------

Ending capital = Beginning + net income –drawing

8,042.00 +7,667.34 – 5,500 = 10,209.34
X Company
Balance Sheet
December 31, 2014
Asset Liability & capital

Cash ---------------------------------------2,842.00 Liability

A/Receivable --------6,133.00 Note Payable --------------------10,000.00

Less Allowance ------- (122.66) -----6,010.34 Account payable ------------------3,670.00
Supplies ------------------------------------277.00 Total Liability ---------------------- 13,670.00
Prepaid insurance -----------------------150.00 Capital
Equipment ----------------------------14,600.00 x-capital ----------------------------10,209.34
Total Asset-----------------------------23,879.34 Total Liability & capital----------23,879.34
Project 2 reconciliation of accounts and cash
The accounts assistance of Xyz Company prepares the following bank reconciliation
for the month of March 31, 2015, but the reconciliation is not correct
XZY Company
Bank Reconciliation
March 31, 2015

Cash Ledger balance march 31.2015 69,316.66

Deposit in transit march 31,2015 8,197.66
9,200.00 notes receivable and 47.00 9,245.93
interest collected by bank march
31,2015 LESS 1.07 service charge 18,280.04
 bank service charge 10.88
Check in payment of account
payable and paid by bank as 91.73 825.57
recorded in the cash payment
journal as 917.30
SUB TOTAL 87,596.70
Less outstanding checks
CK. No. 413 185.22
CK. No. 419 216.25 1,862.96
CK. No. 420 220.24
CK. No. 421 426.56
NSF CHECKS 814.69
Computed bank statement balance 85,733.74
march 31,2015
Un-reconciled balance (14,320.54)
Bank balance as march 31, 2015 71,413.20
Required

Task2.1 prepare corrected bank reconciliation for the month of March 31, 2015

Task2.2 record the necessary journal entries

Task2.3 what are the possible steps and supporting documents to record the above journal entries

Task 1
XZY Company
Bank Reconciliation
March 31, 2015
Balance Bank statement--------------71,413.20 Balance Depositor book record---------69,316.66
Add: Deposit in transit -----------------------------------8,197.66 Add: notes receivable------9,200.00
Interest----------------------47.00
Less: outstanding checks Errors ----------------------825.57
CK. No. 413---------185.22
CK. No. 419---------216.25 Subtotal----------------------------------------------------------10,072.57
CK. No. 420---------220.24 Less: NSF CHECKS---------------814.69
CK. No. 421---------426.56 service charge------------11.95
Sub total -----------------------------------------------(1,048.27) Subtotal -----------------------------------------------------------(826.64)
Adjusted Balance ------------------------------------78,562.59 Adjusted Balance ---------------------------------------------78,562.59

Task 2

1. Note Receivable
Cash ----------------9,200.00

Note Receivable ---------9,200.00

2. Interest
Cash --------------------47.00
Interest income --------47.00
3. Payment of liability
Cash -----------825.57
A/payable -----------------825.57
4. NSF
A/Rec. -----------------814.69

Cash----------------------------814.69

5. Service charge
Miscellaneous Exp. ---------------11.95
Cash--------------------------------------11.95

Task 3
The Possible Supporting Documents
 Bank Advice
 Cash payment journal
 Check register
 Bank deposit slip
 Debit memo
 Credit memo
 Bank statement
 Payment Vouchers(Journal Vouchers)
 Other relevant documents

Steps
 Identify Transactions
 Record the date
 Record the amount
 Record debit part
 Record credit part
 Check the accuracy of numbers with previous cares
 Prepare payment (Journal Vouchers)
 Approval of voucher
 Other relevant procedure
Task 2: prepare annual accounts,

ABC Company is completing its accounting cycle at end of the annual accounting period, June 30, 2010. On
this date the following four adjusting entries must be made. Use the following list of accounts for ease
reference.

Cod Account title Co Account title

e de
A Cash I Unearned rent
B Note receivable J Rent expense
C Interest receivable K Wage expense
D Equipment L Depreciation expense
E Accumulated depreciation M Interest expense
F Note payable N Interest revenue
G Interest payable O Rent revenue
H Wages payable P Some other account not listed
Transaction Debit s Credits
1 On June 1, 2010 the company collected br. 9000 rent revenue in
advance for some warehouse space temporarily rented to a customer
(credited n full to unearned rent). The rent was collected for June, July
and August.
2 Office supplies purchased during 2010 amounted to br. 5000 which
were debited in full to office supplies during the year. The yearend
inventory count of office supplies on hand 600. The beginning
inventory of office supplies was br.800
3 On May 1, 2010, the company signed a br. 50,000 interest bearing
note payable. It was for one year and specified 12 percent annual
interest payable at the maturity date of the note.

a. Perform financial calculation and journalize adjusting entries.

b. Prepare a balance sheet for Abebe and His family Company on June 30, 2010, using the following list
of accounts:

Accounts payable, br. 4,000 Abebe, capital br. ----------

Accounts receivable, br. 3,500 Salaries payable br. 2,000

Cash br. 6,000 Supplies br. 2,500

Equipment br. 7,000 Automobile br. 4,500

Note payable br. 6,500

Task 2, a, Journal entry June 1

1. Calculation June 30, rent revenue cash----------9,000.00

Unearned rent (I) -----------3,000.00 unearned rent -------9,000.00
Rent Revenue (O) -------------------------3,000.00 (liability)
2. Calculation = supplies used =( 800 + 5,000 ) – 600 = 5,200 9,000/3 month = 3,000
Supplies expense (P) ----------------5,200.00
Supplies (P) -------------------------------5,200.00
3. Calculation interest incurred for the two month
Interest = 50, 000 x 2/12 x12/100 = 1,000
Interest expense (M) --------------1,000.00
A/payable (G) ------------------1,000.00

Task 2.b.

Abebe & His family

Balances sheet
June 30, 2010

Asset Liability
Cash -------------------------6,000.00 Note payable ----------------------6,500.00
A/Rec. ----------------------3,500.00 A/payable --------------------------4,000.00
Supplies --------------------2,500.00 Salary payable ---------------------2,000.00
Automobile----------------4,500.00 Total liability 12,500.00
Equipment -----------------7,000.00 Capital
Abebe capital -----------------------
Total Asset ---------------23,500.00 Total liab. & capital ----------------

Abebe’s Capital = 23,500.00 – 12,500.00 = 11,000.00

 Project 4/ Calculate Taxes, fees and charges and foreign currency calculation

Instruction under this project the candidate is expected to perform this task based on the
information provided
Dejene trading imported 40 units of 1300cc vehicles from china with the following cost detail for
each motor vehicle
 Invoice imported cost of 33,000 USD = 33,000 x 40 x 20.30 = 26,796,000.00
 Freight charges paid from Djibouti to Addis Ababa 3,000.00 ETB = 3,000 x 40 = 120,000.00
 Insurance paid to Ethiopia insurance corporation 500.00 ETB = 500 x 40 = 20,000.00

Dejene Trading sells 35 units of vehicles to Ministry of education to distribute to universities throughout the country
at a unit price of 750,000 ETB, for each motor vehicle VAT inclusive. Ministry of education is Tax withholding agent for
Ethiopian revenue and customs authority (ERCA) (WITHHOLDING TAX and VAT) and assume that imported motor
vehicles are VAT exempted

35 x 750,000 = 26,250,000.00

(MOE) Ministry of education has cash shortage until the end of the second fiscal year and request COMERCIAL BANK OF
ETHIOPIA credit facility of 20 million birr to be paid within two years at equal installment semi-annually at interest rate
of 18%. (Exchange rate 1 USD 20.30 ETB).

REQUIRED

Task 4.1 Determine Excise tax (30%), VAT (15%) and Custom duty Tax (35%) liabilities payable by dejene trading.

Task 4.2 Determine the amount of cash paid by MOE and record entries for the transaction by MOE

Task 4.3 Assume you are an employee Commercial Bank of Ethiopia. Show How to handle the credit application of
ministry of education (MOE).

 Keeping data, credit assessment, gather information

 Check and verify application detail
 Sub meet assessment and decisiono
 Task 4.1

Custom duty = Fob cost + freight + insurance x 35%

Excise tax = Fob cost +freight + insurance x 30%

Cost of invoice = 33,000 x20.30------------------ 669,900.00

Fright cost = -----------------------------------------------3,000.00

Insurance = ---------------------------------------------------500.00

Total cost (each vehicle) ----------------------------673,400.00

Total cost (40 vehicles) 673,400.00 x 40 -----26,936,000.00

Custom duty = (26,936,000.00) x 35% = 9,427,600.00

Excise tax = 26,936,000 + 9,427,600

36,363,600 x 30% = 10,909,080.00

No VAT (exempted)

Task 4.2 (MOE)

VAT inclusive selling price = 35 x 750,000 = 26,250,000.00

VAT = 26,250,000.00 x 15 /115 = 3,423,913.04

Before VAT = 26,250,000.00 - 3,423,913.04 = 22,826,086.96

Withholding tax = 22,826,086.96 x 2% = 456,521.74

Cash paid MOE (Net pay) = 22,826,086.96 – 456,521.74 = 22,369,565.22

Journal entries

Motor vehicles ---------------------26,250,000.00

Vat payable -----------------------------------------3,423,913. 04

Withholding ---------------------------------------------456,521.74

Cash --------------------------------------------------22,369,565.22

Payment of payables

VAT payable --------------------------------3,423,913.04

Withholding tax pay---------------------------456,521.74

Cash -------------------------------------- 3,880,434.78

 Task 4.3

 Handling credit applications includes(consist  Preparing & forwarding

of) recommendations to application
 Checking and verifying application details accept or reject application
 Gathering information required to  Maintaining application records
support application  Ensure the application is correct or not correct
 Verifying information provided by  Do some financial calculations on the accuracy
applicant of accuracy of request
 Submitting assessment & decisions  Explain the method of payments and the
 Forming the decisions to rejects or interest rate they will pay
accept application  Submit the application for the right person for
approval & authorization
 Other possible procedures

Task 4.4
Given
1. Loan = 20,000,000.00
Semi-annual PYT = 20,000,000.00/4 = 5,000,000.00 per half year

2 Year

Semi-annually

Interest rate = 18%

Loan repaid at end of the year =5,000,000.00 + 5,000,000.00 = 10,000,000.00

2. Interest repaid at end of the year 1 = 1,800,000.00 + 1,350,000.00 = 3,150,000.00

PYT1= Interest = PRT

1st half I = 20,000,000.00 x 6/12 x 18% =1,800,000.00

Outstanding BAL. = 20,000,000.00 - 5,000,000.00 = 15,000,000.00

2nd I = PRT
15,000,000.00 x 6/12 x 18% = 1,350,000.00

Total interest = 1,800,000.00 + 1,350,000.00 = 3,150,000.00

Outstanding bal. 15,000,000.00 – 5,000,000.00 = 10,000,000.00

Principal = 10,000,000.00

1,800,000.00 + 1,350,000.00 + 10,000,000.00 = 13,150,000.00

 Project one

Assume on November 1, 2016, ABC Company’s accounting record contains the following accounts

Cash Br, 40,000.00

Account Receivable 22,000.00
Office equipment 10,500.00
Account payable 7,000.00
Genet capital 65,500.00
The following transactions occurred during the month 2016:

November 1, The Company paid six months office rent amounted to br. 6,000 starting from November 1,
2016.

10. purchased stationary office supplies for br.4, 500 on account.

17. Provide services to DAT plc. br.15, 000 cash.

17. Genet, owner of the business has withdrawn br.800 for personal consumption.

20. Provide services to DAT plc. br.15, 000 on account.

22. Paid salary of br.3, 500 for its employees

27. Partially collected br. 6000 from DAT plc. For service rendered.

The month end inventory count of office supplies showed br.3, 600 of supplies on hand,
Instructions:

Task 1. Record the journal entries for the above transactions.

Task 2. Post entries to T-account (don’t forget to include beginning balance)

Task 3. Prepare unadjusted trial balance

Task 4. Prepare adjusting entries

Task 5. Prepare adjusted trial balance, on November 30, 2016

Task 6. Prepare income statement and balance sheet

Task7. Prepare post-closing trial balance.

Task.1 journal entries

Nov.1. prepaid rent --------------6,000.00

Cash ------------------------------6,000.00
Nov.10. office supplies -------------4,500.00

A/pay. ---------------------------4,500.00

Nov.17. cash ----------------15,000.00

Service -----------------15,000.00

Nov. 17. Genet drowning ----------800.00

Cash -------------------------------------800.0

Nov.20. A/Receivable -------------15,000

Service ------------------------15,000

Nov. 22. Salary exp. --------------3,500

Cash -----------------------------3,500

Nov.27. cash ----------6,000.00

A/Rec.---------------6,000.00
 Task.3

DAT plc.

Unadjusted trial balance

November 30, 2016

Description Debit Credit

Cash 50,700
Account Receivable 31,000
Prepaid rent 6,000
Office supplies 4,500
Office equipment 10,500
Account payable 11,500
Genet capital 65,500
Genet drowning 800
Service 30,000
Salary exp. 3,500
Total 107,000 107,000

Task 4. Adjusting entries

1. Rent used = 6,000/6months = 1,000

Rent Exp. ----------1,000

Prepaid -----------1,000

2. office supplies used = 4,500 – 3,600 = 900

Office supplies exp. -----------900

Office supplies ------------------------900

 Task.5 adjusted trial balance

DAT plc.

Adjusted trial balance

November 30, 2016

Description Debit Credit

Cash 50,700
Account Receivable 31,000
Prepaid rent 5,000
Office supplies 3,600
Office equipment 10,500
Account payable 11,500
Genet capital 65,500
Genet drowning 800
Service 30,000
Salary exp. 3,500
Rent exp. 1,000
Office supplies exp. 900
Total 107,000 107,000

Task 6. Prepare income statement and balance sheet

DAT plc.

Income statement

For the month ended November 30, 2016

Description Debit Credit

Revenue
Service 30,000

Salary exp. 3,500

Rent exp. 1,000
Office supplies exp. 900
Total expense (5,400)
Net Income 24,600
 DAT plc.

Balance Sheet

November 30, 2016

Asset liability & capital

Cash-----------------------50,700 Account payable----------------11,500

A/Rec. ---------------------31,000 Capital

Prepaid rent---------------5,000 Genet capital -----------------------89,300

Office supplies ------------3,600

Office equipment---------10,500

Total Asset ---------------100,800 Total liability & capital--------------100,800

Ending Genet capital = Genet capital + Net income - Genet drowning

65,500 +24,600 – 800 = 89,300

Task7. Prepare post-closing trial balance.

Closing entry

1. Revenue closing

Service Revenue -----------30,000

Income summary-------------------30,000

2. Expense closing
Income summary-------------5,400
Salary exp. -----------------3,500
Rent exp. -------------------1,000
Office supplies exp. -------- 900
3. Closing drowning
Genet capital ---------------------800
Genet Drowning------------------------800
4. Closing income summary
Income summary---------------24,600
Genet capital ----------------24,600
 Post-closing trial balance

DAT plc.

Post-closing trial balance

November 30, 2016

Description Debit Credit

Cash 50,700
Account Receivable 31,000
Prepaid rent 5,000
Office supplies 3,600
Office equipment 10,500
Account payable 11,500
Genet capital 89,300
Total 100,800 100,800
Project two bank reconciliation

The cash in bank account for Zola Company at January 1, 2014 indicated a balance of br. 4,004. The
cash receipts journal showed a balance of br.2867 and the check register of payment for January
balance br. 2860. The bank statement indicated a balance of br. 5857 on January 31. Comparison of
the bank statement and accompanying canceled checks and memorandums with the records
revealed the following reconciling items:

8, Checks outstanding br.1, 600

9, A deposit of br.500 representing receipts of June 30, did not appear on the bank statement.

10, The bank had collected br. 1030 on an interest –bearing note left for collection. The face of the
note was br. 1000.

11, a cheque for br. 470 returned with the statement had been incorrectly charged by bank as br.
740.

12, a check for br. 148 returned with the statement had been recorded erroneously in the check
register as br. 184. The check was for the payment of on account for suppliers

13, bank service charges for June amounted to br. 50.

Required:

1. Prepare bank reconciliation for the month of January 31,2014

2. Record the necessary entries.

Bal. Depositor book of record -----------4,004.00

Add; cash receipts --------------------- 2,867.00

Loss; ------------------------------------------ (2,860.00)

Ending Bal. Depositor book of record 4,011.00

 Task 1
Zola Company
Bank Reconciliation
January 31, 2014

Balance Bank statement-------------- 5,857.00 Balance Depositor book record---------4,011.00

Add: Deposit in transit ---------- 500.00 Add: notes receivable------1,000.00
Errors -------------------------270.00 Interest----------------------30.00
Subtotal ------------------------------------------------- 770.00 Errors ---------------------- 36.00
Less: outstanding checks---------------------------- (1, 600)
Subtotal----------------------------------------------------------1,066.00
Less:
service charge------------50.00
Subtotal -----------------------------------------------------------(86.00)
Adjusted Balance --------------------------------------- 5,027.00 Adjusted Balance ---------------------------------------------
5,027:00

Task 2.
1. Note rec.
Cash --------------1,030.00
N/Rec. -------------------------1,000.00
Interest income ------------------30.00
2. Error
Cash -------------------36.00
A/pay. -----------------------36.00

3. Service charge
Miscellaneous Exp. ------------ 50.00
Cash -------------------------------50.00
Project 2
Unit of com
Process payroll
The following Payroll data relates to XY Company for the month of Hidar 30, 2008E.C

Name of employee Basic Allowance Over Time

salary

0 Mamo Hailu 2,500 900 4(2), 4(2.5),

2(1.25)
1

0 Selam kebede 5,000 1000 6(2)

2

0 Hirut taye 10,000 1200 8(2.5)

3

0 Mola tadesse 12,500 1400 -

4

Additional information
 All employees agreed to pay one month salary to be paid for one year for Abay.
Dam.
 All employees are exempted tax Allowance up to 400 birr.
 All employees are permanent and worked 40 hours per week.
 Employer and employees are expected to contribute basic 11% and 7% to
pension
Task 1: prepare payroll document/register sheet as of hidar 30,2005.
Task 2. Pass accessary journal entries
 Preject2: Bank reconciliation Give the following:

a. Company BB’s bank statement dated December 31, 2013 shows a balance of br. 65,040.00. The
company’s cash records on the same date show a balance of br. 37,820.00.
b. Following checks issued by the company to its customers are still outstanding:
No. 846 issued on Nov 29 13,200.00
No. 875 issued on Dec 26 5,000.00
No. 878 issued on Dec 29 4,000.00
No. 881 issued on Dec 31 2,060.00
Total 24,260.00
c. A deposit of br. 9,040.00 made on December 31 does not appear on bank statement.
d. A check of br. 20,400.00 was returned by the bank with bank statement as non-sufficient found (debit
memorandum).
e. A safe deposit rent br. 260 and service charge br.140.
f. A CK.no 555 for 10,160.00 to x-company for settlement of accounts payable recorded in cash payment
journal as br. 18,460.00.
g. The bank collected a note receivable of br. 24,500 (note receivable br. 24,000 and interest br. 500) on
behalf of the company.
Task 1. Prepare bank reconciliation Task 2. Pass the necessary journal entries.
Task 1
BB’s Company
Bank Reconciliation
December 31, 2013

Balance Bank statement----------------------- 65,040.00 Balance Depositor book record------------ 37,820.00

Add: Deposit in transit --------------------------------- 9,040.00 Add: notes receivable------24,000.00
Less: outstanding checks Interest---------------------500.00
No. 846 issued on Nov 29 ---- 13,200.00 Errors------------------- 8,300.00
No. 875 issued on Dec 26 ----- 5,000.00 Subtotal-----------------------------------------------32,800.00
No. 878 issued on Dec 29----- 4,000.00
No. 881 issued on Dec 31 ------ 2,060.00
Less: NSF --------------------20,400.00
subtotal -------------------------------------- (24,260.00) Rent ex---------------------260.00
service charge----------- 140.00
Subtotal ----------------------------------------------- (20,800.00)
Adjusted Balance -------------------------------------- 49,820.00 Adjusted Balance ---------------------------------- 49,820.00

Task 2.
1. Note rec.
Cash --------------24,500.00
N/Rec. -------------------------24,000.00
Interest income -----------------500.00
2. Error
Cash -------------------8,300.00
A/pay. -----------------------8,300.00
3. Service charge
Miscellaneous Exp. ------------ 140.00
Rent exp. -------------------------260.00
Cash -------------------------------400.00
4. NSF
A/Rec. ------------------ 20,400.00
Cash -------------------------------- 20,400.00
Project 3 prepare financial report

The accounts in the ledger of BB Company, with the unadjusted balance on December 31, 2010, the end of the fiscal year
are as follows:

BB Company

Unadjusted trial balance

December 31, 2010

Cash Br. 87,500.00

A/Rec. 192,300.00

Merchandise inventory 290,500.00

Prepaid insurance 25,380.00

Store supplies 16,500.00

Store equipment’s 179,000.00

Accumulated dep.-equip. 50,600.00

A/payable 89,480.00

Salaries payable

Capital stock 360,000.00

Retained earnings 162,890.00

Dividends 120,000.00

Income summary

Sales 1,890,000.00

Purchase 1,220,000.00

Sales salary exp. 154,800.00

Advertising exp. 49,600.00

Depreciation exp.

Store supplies exp.

Miscellaneous exp. 8,800.00

Office salaries exp. 79,690.00

Rent exp. 80,000.00

Utility exp. 32,200.00

Tax exp. 17,000.00

Insurance exp.

General exp. 7,200.00

Other income 7,600.00

Data needed for yearend adjustments are as follows;

1. Merchandise inventory on December 31 br. 301,000.00

2. Insurance expired during the year, br. 12,800.00
3. Store supplies inventory on December 31 br. 4,300.00
4. Depreciation for current year, br. 38,400.00
5. Accrued salaries on December 31
a. Sales salaries br. 5,600.00
b. Office salaries br. 2,600.00

Task 1. Prepare the necessary adjusting entries.

Task 2. Prepare income statement and balance sheet.

Task 1. 1. Adjusted entries

1.1. Remove beginning inventory

Income summary ---------------290,500.00
Merchandise inventory -------------------290,500.00
1.2. Inter ending inventory
Merchandise inventory -------------------301,000.00
Income summary ---------------301,000.00
2. Insurance = 25,380 -12,800 = 12,580
Insurance expense ---------------12,800
Prepaid insurance ------------------------12,800
3. Store supplies used = 16,500 – 4,300 =12,200
Store Supplies exp. -----------------------12,200
Store Supplies----------------------------------12,200
4. Dep. Exp. ------------------------38,400
Accumulation exp. -------------------38,400
5. Accrual 1st action 2nd amount
Sales salary exp. ------------5,600
Office salary exp. ----------2,600
Salary payable -------------8,200

This is multiple income statement Task 2.

BB Company
 Income statement

For the year ended December 31, 2010

Revenue

Sales--------------------------------------------------------------------------------------------------1,890,000

Less cost of goods sold

Beg. Inventory ------------------------290,500

Add: purchase ---------------------1,220,100

M.I. Available for sale ------------1,510,600

Less Ending Inventory ---------------301,000

Cost of goods sold------------------------------------------------------------------------------- (1,209,600)

Gross profit ------------------------------------------------------------------------------------------680,400

Less Operation Exp.

Sales salary exp. -------------------- 160,400.00

Advertising exp. ---------------------- 49,600.00

Depreciation exp. ----------------------38,400.00

Store supplies. --------------------------12,200.00

Miscellaneous exp. ----------------------8,800.00

Office salaries exp. ---------------------82,290.00

Rent exp. -----------------------------------80,000.00

Utility exp. --------------------------------32,200.00

Tax exp. ------------------------------------17,000.00

Insurance exp. ---------------------------12,800.00

General exp. -------------------------------7,200.00

Total Exp. ---------------------------------------------------------------------------------------------- (500,890.00)

Income ---------------------------------------------------------------------------------------------------- 179,510.00

Add: Other Income -----------------------------------------------------------------------------------------7,600.00

Net income -------------------------------------------------------------------------------------187,110.00

Ending Retained = Beginning Retaining + Net income - dividend

 = 162,890.00 + 187,110.00 - 120,000.00 = 230,000.00
BB Company
Balance Sheet

December 31, 2010

Asset Liability & Capital

Current Asset liability

Cash ------------------87,500 A/pay.-------------------------------89,480

A/Rec. --------------192,300 salary pay.---------------------------8,200

M.I -------------------301,000 Total lib. ----------------------97,680.00

Pre. Insurance ------12,580 Capital

Store sup. -------------4,300 Capital stock ---------------------------------360,000

Current Asset---------------------------597,680.00 Retained earnings-----------------------------230,000

Fixed Asset Total Capital ---------------------------------590,000.00

Equipment --------179,000

Less Accum. Dep. ----89,000

Fixed Asset------------------------------90,000.00

Total Asset -----------------------------687,680.00 Total Liability & Capital-------------687,680.00

Project 4 partnership liquidation

Given:
WXY- Company
 Balance sheet

July 29, 2012

Assets Liabilities
Cash--------------------------------------------br.40,000.00 A/Payable ------------------------------------br. 380,000.00
Capital
Noncash ----------------------------------------680,000.00 W, capital ---------------------------------------140,000.00
X, capital ----------------------------------------100,000.00
Y, capital ----------------------------------------100,000.00
Total assets --------------------------------------720,000.00 Total lib. & capital------------------------------720,000.00

 Between July 3 & July 29, the noncash assets were sold for br. 356,000 and share income
or loss 5:3:2
 Assume the partner with the capital deficiency forced to pay his or her deficiency to the
partnership, and the liabilities are paid.
Task 1. Prepare statement of partnership liquidation.
Task 2. Prepare the necessary Journal entries for liquidation.

Loss = non cash – sold 680,000 – 356,000 = 324,000.00

324,000 x5/10 = 162,000
324,000 x 3/10 = 97,200
324,000 x 2/10 = 64,800

WXY- partnership
Statement of partnership liquidation

July 29, 2012

Description Cash Non Liability W-Capital X-Capital Y-Capital
Cash
Balance 40,000 380,000 380,000 140,000 100,000 100,000
Realization non cash 356,000 380,000 - (162,000) (97,200) (64,800)
Asset
Balance 396,000 0 380,000 (22,000) 2,800 35,200
Payment of liability (380,000) - (380,000) - - -
Bal. 16,000 0 0 (22,000) 2,800 35,200
Cash Pay. By W- 22,000 - - 22,000 - -
partner
Bal. 38,000 0 0 0 2,800 35,200
Final cash bal. to (38,000) - - - (2,800) (35,200)
partner
Bal. 0 0 0 0 0 0

Task 2.Journal Entries

5. Realization of non-cash asset
Cash ------------------------------356,000
Loss realization-----------------324,000
Non cash asset--------------------------380,000
6. Distribution of loss to partners
Loss = non cash – sold 680,000 – 356,000 = 324,000.00

324,000 x5/10 = 162,000

324,000 x 3/10 = 97,200

324,000 x 2/10 = 64,800

W-capital --------------162,000

X-capital ----------------97,200

Y-capital ----------------64,800

Loss on realization------------------------324,000

7. Payment of liability

A/pay. ------------380,000
Cash -------------------------380,000
 8. Payment of cash by w-partners
W-capital---------22,000
Cash ---------------22,000
9. Final cash payments
X- Capital -------------------2,800
Y- Capital -----------------35,200
Cash ---------------------------------38,000

Project 5 Dividend
Ato Dejene Assefa is a shareholder of Merkato Company. He owned 300,000 shares
of br. 300 par values common. Merkato Company declares and paid br.0.20 per
share.
1. How much dividend paid to Ato Dejene?
2. How much tax is paid to tax authority?
3. How much money ato Dejene receive after tax?
4. Who is liable to pay tax to the authority?
Task 1.
Dividend =300,000 x 0.20 = 60,000.00
Task 2.
Dividend tax = 60,000 x 10% = 6,000.00
Task 3.
Net dividend = 60,000 – 6,000.00 = 54,000.00
Task 4
Merkato Company is liable to pay tax to the authority
 Project 3 process payroll

Zelalem trading has the following Employees information’s for the month of June 2015.

Name of Basic salary Allowance Overtime hours Duration of

Employees worked overtime hours
worked
Gutahun Dessie 3,150.00 1,000.00 4hrs Public holiday
Menbere 4,320.00 1,000.00 8hrs Week end
Mequanent
Yesahreg Retta 5,230.00 1,000.00 6hrs 10:00Pm - 6:00Am
Belay Takele 1,890.00 800.00 9hrs Public holiday
Alhegn Bantie 2,230.00 800.00 10hrs 6፡00Am – 10:00PM

Additional information

 All employees are permanent and expected to work 40hts per week
 Transportation allowance is not Taxable
 40% of allowance is for housing allowance and the remaining is for transportation allowance
 10% of basic salary is deducted for credit and saving association from all employees
 15% of basic salary is deducted from alehegn Bantie to be paid to ERCA for cost sharing
REQUIRED

Task 3.1 prepare payroll register sheet for the month of June 30, 2015

Task 3.2 Record the necessary journal entries for the month of June 2015

Task 3.3 Record journal entries for the payment of payroll liability

Task 3.4 Zelaem Trading makes salary payment to employees by bank and you assigned to prepare bank
transfer letter but the bank letter for yesharege is not correct and she complains this issue for correction. How
can you handle this complain & resolve the problem.
Task 3.4

 Check the amount with the payroll register sheet

 Check the amount with the bank transfer letter
 Make sure that the amount & ensure the complaint is correct or not correct
 Meet your supervisor
 Prepare another bank letter to be signed by the person who have the authorization to sign bank letters
 Meet the bank
 Discuss with bank staffs who is responsible to handle this issues
 respond complain
 Using effective communication
 refer complain
 I will exercise judgment to resource customs service
 Identify issues
 Face to face, internet , Email ,telegram

Project 4 Calculate Taxes, fees and charges and foreign currency calculation
Instruction under this project the candidate is expected to perform this task based on the
information provided
Dejene trading imported 40 units of 1300cc vehicles from china with the following cost detail for
each motor vehicle
 Invoice imported price 33,000 usd = 33,000 x 40 x 20.30 = 26,796,000.00
 Freight charges paid from Djibouti to Addis Ababa 3,000.00 ETB = 3,000 x 40 = 120,000.00
 Insurance paid to Ethiopia insurance corporation 500.00 ETB = 500 x 40 = 20,000.00
 Dejene Trading sells 35 units of vehicles to Ministry of education to distribute to universities though the country at a
unit pries of 750,000 ETB for each motor vehicle VAT inclusive. Ministry of education is Tax withholding agent for
Ethiopian revenue and customs authority (WITHHOLDING TAX and VAT) and assume that imported motor vehicles are
VAT exempted

35 x 750,000 = 26,250,000.00

Ministry of education has cash shortage until the end of the second fiscal year and request COMERCIAL BANK OF
ETHIOPIA credit facility of 20 million birr to be paid within two years at equal installment semiannually at interest rate of
18%. (Exchange rate 1 USD 20.30ETB).

REQUIRED

Task 4.1 Determine Excise tax (30%), VAT (15%) and Custom duty Tax (35%) liabilities payable by dejene trading.

Task 4.2 Determine the amount of cash paid by Moe and record entries for the transaction by Moe

Task 4.3 Assume you are an employee Commercial Bank of Ethiopia. How to handle the credit application of ministry of
education.

 Keeping data, credit assessment, gather information

 Check and verify application detail
 Sub meet assessment and decision
 Maintain application record and measure document

Task 4.4 Determine the loan and interest expense paid at the end of the first year

Task 4.1

Custom duty = Fob cost + freight + insurance x 35%

Excise tax = Fob cost +freight + insurance x 30%

Cost of invoice = 33,000 x20.30 = 669,900.00

Fright cost = ------------------------ 3,000.00

Insurance = -------------------------- = 500.00

Total cost (each vehicle) ---------------- = 673,400.00.00

Total cost (40 vehicles) 673,400.00 x 40 = 26,936,000.00

Custom duty = (26,936,000.00) x 35% = 9,427,600.00

Excise tax = (26,936,000 + 9,427,600) x 30% = 10,909,080 33,000 USD x 20.30 = 669,900

Vat = (35 x 750,000) x 15% /1.15 = 3,423,913.04 669,900 x 40 unit = 26,769,000

26,250,000.00 - 3,423,913.04 = 22,826,086.96

Task 4.2 (MOE)

Vat inclusive selling price = 35 x 750,000 = 26250,000.00

26,250,000.00 x 15% /1.15 = 3,423,913.04

Before VAT = 26,250,000.00 - 3,423,913.04 = 22,826,086.96 = price

Withholding tax = 22826,086.96 x 2% = 456,521.74

Journal entries

Motor vehicles ---------------------26,250,000.00

Vat payable -----------------------------------------3,423,913. 04

Withholding ---------------------------------------------456,521.74

Cash --------------------------------------------------22,369,565.22

Payment of payables

VAT payable --------------------------------3,423,913.04

Withholding tax pay-------------------------456,521.74

Cash -------------------------------- 3,880,434.78

Task 4.3

 Handling credit applications includes  Ensure the application is correct or not correct
 Checking and verifying application details  Do some financial calculations on the accuracy
 Gathering information required to support of request
application  Explain the method of payments and the
 Verifying information provided by applicant of interest rate they will pay
accuracy  Submit the application for the right person for
 Submitting assessment & decisions approval & authorization
 Maintaining application records  Other possible procedures

Task 4.4
3. Loan = 20,000,000 20,000,000/4 = 5,000,000 per half year

2 Year

Semi-annually

Interest rate = 18%

Loan repaid =5,000,000x 2 year = 10,000,000.00

4. Interest paid at the year 1

PYT1=
Interest = PRT
1st half I = 20,000,000 x 6/12 x 18% =1,800,000

Outstanding bal. = 20,000,000 - 5,000,000 = 15,000,000

2nd I = 15,000,000 x 6/12 x 18% = 1,350,000

Total interest =1,800,000 +1,350,000 = 3,150,000

Outstanding bal. 15,000,000 – 5,000,000 = 10,000,000

Principal = 10,000,000.00

1,800,000 + 1,350,000 + 10,000,000 = 13,150,000.00

Bank Reconciliation
Task 2.3
The Possible Supporting Documents
 Bank Advice
 Bank statement
 Payment Vouchers(Journal Vouchers)
 Other relevant documents
Steps
 Identify Transactions
  Check the accuracy of numbers with previous cares
 Prepare payment (Journal Vouchers)
 Approval of voucher
 Other relevant procedures

Project 3 process payroll

Task 3.4 Zelaem Trading makes salary payment to employees by bank and you assigned to prepare bank transfer letter
but the bank letter for yesharege is not correct and she complains this issue for correction. How can you handle this
complain resolve the problem.

 Check the amount with the payroll register sheet

 Check the amount with the bank transfer letter
 Make sure that the amount & ensure the complaint is correct or not correct
 Meet your supervisor
 Prepare another bank letter to be signed by the person who have the authorization to sign bank letters
 Meet the bank
 Discuss with bank staffs who is responsible to handle this issues
 respond complain
 Using effective communication
 refer complain
 I will exercise judgment to resource customs service
 Identify issues
 Face to face, internet , Email ,telegram

Project 4 Calculate Taxes, fees and charges and foreign currency calculation

Task 4.3 Assume you are an employee Commercial Bank of Ethiopia. How to handle the credit application of ministry of
education.

 Keeping data, credit assessment, gather information

 Check and verify application detail
 Sub meet assessment and decision
 Maintain application record and measure document
 Ensure the application is correct or not correct
 Do some financial calculations on the accuracy of request
 Explain the method of payments and the interest rate they will pay
 Submit the application for the right person for approval & authorization
 Other possible procedures

Choose the best answer

1. If revenue is 85,000, expense is 70,000 and withdrawal is 20,00 what is net income or loss
a. 65,000 net income 85,000 -70,000 = 15,000 net income
b. 90,000 net loss
c. 15,000 net income
d. 15,000 net loss
2. Which one of the following is not external parties
a. Creditor
b. Investor
c. Government
d. Sales person
3. Which one is necessary to bank reconciliation
a. Balance of depositor and bank
b. Deduct of outstanding amount
c. Deposit in transit
d. Errors
4. If the liability is 90,000 and asset is equity of 3X what is the amount of asset and capital
a. 40,000 and 90,000
b. 95,000 and 120,000
c. 135,000 and 45,000
d. 90,000 and 45,000
5. Which one of the following is external parties
a. Owners
b. Government
c. Employee and trade union
d. Production managers
6. At the end of the fiscal year, the adjusting entry for accrued salaries was inadvertently omitted. The effect of the
error (assuming that it is not corrected) would be to
a. Understate net income for the year
b. Overstate net income for the year
c. Understate liabilities at the end of the year
d. All
7. Establish by estimating the amount of cash needed for disbursement of relative small amount during specific
period
a. Change in fund
b. Petty cash
c. Cash short and over
d. Fund transfer
8. The post-closing trial balance would include which one of the following account
a. Cash
b. Sales
c. Salary expense
d. All
9. Transaction the first account be recorded to a book of
a. Journal
b. Payment journal
c. Ledger
d. Receipts journal
10. Proprieties owned by business
a. Asset
b. Capital
c. Liabilities
d. Revenue

11. Assume that you have 500 euro in your hand what is the equivalent USD if exam rate for USD is br. 18 for euro
24 br.
a. 6,66.67 USD
b. 500 USD
c. 5,833.33 USD
d. 120.00 USD
12. The post-closing trial balance would include which one of the following account
a. Account receivable
b. Sales
c. Salary expense
d. Interest expense
13. Goods and document are examined in accordance with legislative requirements plus it needs bank permits base
on CBE directive this
a. To have principal legislative
b. Regulation declaration of tax
c. Internal control system
14. Payment of cash for settlement of purchase on account would be recorded by
a. Cash debit
b. A/p credit
c. A/p debit
d. A/R credit
15. Proprieties of owed by business
a. A/pay
b. Revenue
c. Liabilities
d. Income summary
16. Salary expense has a credit balance of br. 100,000 on beginning of period after revenue entries pasted before any
transaction to record the represents
a. Asset
b. Revenue
c. Liability
d. expense
17. maturity value 0.90 days 100,000
a. 9,000
b. 3,000
c. 103,000
d. 3.500
18. Before adjusting entry account receivable has a balance of br. 400,000 and allowance for doubtful account has to
5000 it estimated uncollectible account br. Is 17,000 the uncollectible expense is
a. 15,000
b. 5.000
c. 12,000
d. 400,000
19. One of the following account not closed on the end of the accounting fiscal period
a. Expense
b. Income summary
c. Revenue
d. Liability
20. Minor amount of money to replenish the company activity
a. Change fund
b. Petty cash
c. capital receipt journal
d. Cash receipt journal
21. Sales or purchase is recorded in which financial report
a. Income statement
b. Trial balance
c. Balance sheet
 d. Cash flow

22. Controlling account that summarize the balance of each customer is

a. Account payable
b. Merchandise inventory
c. Account receivable
d. Income summary
23. Which one of the following does not need journal
a. Note collected and bank service charge
b. Deposit in transit and outstanding checks
c. Non-sufficient fund
d. Interest revenue earned by the depositor
24. Which one is elated
a. Bank draft(cheque)
b. CPO payment
c. Term loan
d. Bank statement/payment
25. Secondary record from
a. Ledger
b. General journal
c. Trial balance
d. Balance sheet
26. The income statement debit balance was br. 65,000 credit balance was br. 90,000 and owners withdrawal were
br. 20,000 the amount of net income or net loss was
a. 20,000
b. 15,000
c. 5,000
d. 10,000
27. The adjustment of unearned revenue recorded the result will show
a. Over statement of liability
b. Over statement of revenue
c. Understatement of liability
d. Understatement of expense
28. Which one of the following are not characteristics of taxation;
a. It is compulsory lovey
b. It provides non proportional return or profit
c. It finances government activities
d. It is an illegal collection
29. Sets installment of financial condition for individual reported at
a. Cost
b. Estimated
c. Lower of cost or market
d. Market value
 Matching
Mutual agency -------------------------partnership
Indirect tax------------------------------sales tax
Visa card -------------------------------- credit card
Supervision ---------------------------- small team
Swot -------------------------------------used to improve business performing
Cash --------------------------------------liquid asset
System disine --------------------------keeping data
Credit memo ---------------------------deposit to the customer
Cheque /Cpo --------------------------- payment instrument
Ic ----------------------------------------bank advise

Performance measurement ---------------------------------- continues improvement

Accrued revenue ------------------------------------------------ account receivables

Percentage --------------------------------------------------------- formula

Corporation ------------------------------------------------------- retaining earning

Spread sheet ------------------------------------------------------- software application

Lead back ---------------------------------------------------------- related service and rescored

Indirect tax------------------------------------------------------------ sales tax

Communication ---------------------------------------------------- speaking to group

Balance sheet ------------------------------------------------------- business entity concept

Expense account -------------------------------------------------- freight in and out

Specific need to customer --------------------------------------- culture

Promotion ----------------------------------------------------------- press resale

Plan spread sheet ------------------------------------------------- automatic soft ware

Income summary close to ---------------------------------------capital

An amount associated with a business -------------------transaction costs

Increase in owner’s equity-----------------------------------net income

Economic resources owner by a business----------------- Asset

Incurred when one currency is exchange another-------- money measure

Revenue & Expense -------------------------------------------Temporary account

Biggest segment of the economy ------------------------------Equities

Money paid or workers -----------------------------------------wage

Business goal -----------------------------------------------------profitability

Allocating recorded costs b/n two accounting period -----unused supplies

Deduction form employee earning -------------------------Income tax

Organized & scheduled activities ----------------------work plan

Long-term liability ----------------------------------------Bond

A
B

1. Performance measurement a. press resale

2. Sales tax b. corporation
3. Income summary close to c. percentage
4. Promotion d. automatic software application
5. Expenses account e. fright in and out
6. Formula f. software application
7. Coaching and monitoring g. continues improvement
8. Spread sheet h. business entity
9. Plan spread sheet i. culture
10. Balance sheet j. consumer
11. Retained earnings k. related service and rescored
12. Complete l. providing assistance with problem-solving
13. Special need to customer m. capital
14. Method of communication n. speaking to group
15. Feedback o. source document
16. Ledger p. secondary book
17. Batch q. group of journal
18. Letter of credit r. customer is to be credited
19. Maintain quality document s. used to keep accurate date record
20. Double taxation t. customer is to be credited
 Task 4.1

Custom duty = Fob cost + freight + insurance x 35%

Excise tax = Fob cost +freight + insurance x 30%

Cost of invoice = 33,000 x20.30 = 669,900.00

Fright cost = ------------------------ 3,000.00

Insurance = -------------------------- = 500.00

Total cost (each vehicle) ---------------- = 673,400.00.00

Total cost (40 vehicles) 673,400.00 x 40 = 26,936,000.00

Custom duty = (26,936,000.00) x 35% = 9,427,600.00

Excise tax = (26,936,000 + 9,427,600) x 30% = 10,909,080 33,000 USD x 20.30 = 669,900

Vat = (35 x 750,000) x 15% /1.15 = 3,423,913.04 669,900 x 40 unit = 26,769,000

26,250,000.00 - 3,423,913.04 = 22,826,086.96

Task 4.2 (MOE)

Vat inclusive selling price = 35 x 750,000 = 26250,000.00

26,250,000.00 x 15% /1.15 = 3,423,913.04

Before VAT = 26,250,000.00 - 3,423,913.04 = 22,826,086.96 = price

Withholding tax = 22826,086.96 x 2% = 456,521.74

Journal entries

Motor vehicles ---------------------26,250,000.00

Vat payable -----------------------------------------3,423,913. 04

Withholding ---------------------------------------------456,521.74

Cash --------------------------------------------------22,369,565.22

Payment of payables

VAT payable --------------------------------3,423,913.04

Withholding tax pay-------------------------456,521.74

Cash -------------------------------- 3,880,434.78

 Task 4.3

 Handling credit applications includes

 Checking and verifying application details
 Gathering information required to support
application
 Verifying information provided by applicant of
accuracy
 Submitting assessment & decisions
 Maintaining application records
 Ensure the application is correct or not correct
 Do some financial calculations on the accuracy
of request
 Explain the method of payments and the
interest rate they will pay
 Submit the application for the right person for
approval & authorization
 Other possible procedures
 Task 4.4
5. Loan = 20,000,000 20,000,000/4 = 5,000,000 per half year

2 Year

Semi-annually

Interest rate = 18%

Loan repaid =5,000,000x 2 year = 10,000,000.00

6. Interest paid at the year 1

PYT1=
Interest = PRT

1st half I = 20,000,000 x 6/12 x 18% =1,800,000

Outstanding bal. = 20,000,000 - 5,000,000 = 15,000,000

2nd I = 15,000,000 x 6/12 x 18% = 1,350,000

Total interest =1,800,000 +1,350,000 = 3,150,000

Outstanding bal. 15,000,000 – 5,000,000 = 10,000,000

Principal = 10,000,000.00

1,800,000 + 1,350,000 + 10,000,000 = 13,150,000.00