Test 1 Acc117

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CONFIDENTIAL AC/DEC2023/ACC117/106

UNIVERSITI TEKNOLOGI MARA


TEST 1

INTRODUCTION TO FINANCIAL ACCOUNTING /


COURSE : INTRODUCTION TO FINANCIAL ACCOUNTING AND
REPORTING
COURSE CODE : ACC117 / 106
EXAMINATION : DECEMBER 2023
TIME : 1 HOUR 30 MINUTES

INSTRUCTIONS TO CANDIDATES

1. This question paper consists of three (3) parts:


Part A (10 Questions)
Part B (10 Questions)
Part C (1 Question)

2. Answer ALL questions in the Question Paper.

3. Fill in the details below:

Name:
UiTM Student Card No:
Group:
Name of Lecturer:

DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO


This test paper consists of 6 printed pages
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CONFIDENTIAL AC/DEC2023/ACC117/106

PART A

State whether each of the following statement is TRUE or FALSE.

1. Accounting process includes the process of analysing and interpreting the information
recorded in the books of accounts. FALSE

2. The accounting process involves recording non-quantifiable economic events. FALSE

3. Accounting primarily protects the interest of outsiders dealing with organization in


various capacities. TRUE

4. A business organisation as a separate legal entity is a sole proprietorship. FALSE

5. It is on the basis of going concern concept that the assets are always valued at market
value. TRUE

6. According to money measurement concept, the efficiency of the top management of the
business must be clearly recorded in the books of accounts. FALSE

7. Faithful presentation means the accounting information recorded must be neutral,


complete and free from errors. TRUE

8. The comparison of the results of one accounting period with that in the past is possible
when the business maintains consistency in adopting accounting policies. TRUE

9. The sum of the assets and liabilities of a business always equals to the investment of a
business owner. FALSE

10. When an owner withdraws cash from the business, the transaction affects both assets
and owners’ equity. TRUE

(Total: 10 marks)

PART B

Choose ONE (1) most appropriate answer.

1. The accounting cycle starts with the _______.

a) preparation of ledger accounts


b) preparation of trial balance
c) analysis of business transaction
d) preparations of adjusting entries

2. All the followings are characteristics of a sole proprietorship, EXCEPT ______.

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CONFIDENTIAL AC/DEC2023/ACC117/106

a) owner has unlimited legal liability


b) owner has control of the business
c) owner and the business are separate legal entity
d) None of the above

3. In accounting and bookkeeping, the term POSTING refers to ______.

a) the transfer of information from ledger to trial balance


b) the transfer of entries from journal to ledger
c) the preparation of financial statement from trial balance
d) None of the above

4. The following would be considered an internal user of accounting information for


Media Perdana Sdn. Bhd. EXCEPT ________?

a) president of the company


b) production Manager
c) merchandise inventory Clerk
d) president of the employees’ labour union

5. Companies not disclosing an imminent bankruptcy would violate ______


concept.

a) business entity concept


b) going concern concept
c) monetary unit concept
d) historical cost concept

6. According to _____ concept, assets are recorded at their original purchase price.

a) materiality
b) historical cost
c) going concern
d) monetary

7. Switching accounting principles and methods every year would violate _____
characteristic.

a) timeliness
b) verifiability
c) comparability
d) understandability

8. Each item in financial statements must be able to demonstrate its accuracy of


information with evidence. This statement follows ________ characteristic.
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faithful presentation
CONFIDENTIAL AC/DEC2023/ACC117/106

a) timeliness
b) verifiability
c) comparability
d) understandability

9. If the assets of a business are RM100,000 and the owners’ equity is RM20,000 the
value of the liabilities will be ________.

a) RM100,000 ASSETS - OWNER'S EQUITY = LIABILITIES


b) RM80,000
c) RM120,000
d) RM20,000

10. A debit entry could lead to __________.

a) an increase in assets or decrease in expenses


b) an increase in revenues or an increase in liabilities
c) a decrease in revenues or decrease in assets
d) a decrease in liabilities or an increase in expenses

(Total: 10 marks)

PART C

Given below is the extract of business transactions of Bertam Indah Pharmacy for the month
of September 2023:

September Transactions

2 The owner brought in additional cash of RM12,000 and RM3,000


refurbished desktop into the business.

5 Purchased 500 boxes of Influenza test kit from Nia Medicare Sdn. Bhd.
worth RM10 per box, on credit.

7 A cheque of RM2,000 was received from Mega Kulim Pharmacy for the
invoice issued in August 2023.

9 Made cash sales of RM2,500.

12 Received cash of RM300 for returning faulty pharmaceutical product to


Noni Pharma Sdn. Bhd.

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CONFIDENTIAL AC/DEC2023/ACC117/106

15 Received dividend of RM1,000 by cheque from Bank Islam.

17 Renewed business registration by cash RM200. This is to be recorded


under miscellaneous item.

20 Purchased RM3,000 of disposable gloves from 3M Distributors by cash.

22 Purchased two display cabinets for a total of RM2,200 from One Furniture.
Issued a deposit of RM1,000 by cash and the balance is to be paid on next
month.

25 Made credit sales of RM6,000 to Alpro Pharma.

26 Paid Nia Medicare Sdn. Bhd. for the invoice received on 5 September
2023 by cheque.

28 Return of defect goods from Alpro Pharma worth RM100.

30 Paid utility bills RM300 by cash

31 The owner took hand sanitisers worth RM200 from the pharmacy as a
lucky draw gift for her personal donation.

Required:

a. Illustrate the effects (increase/decrease) of asset, liability, owner's equity, income and
expense of the above transactions.
(15 marks)

b. Show the journal entry (debit or credit) of the above transactions.


(15 marks)

(Total: 30 marks)

Use the table provided below to answer Part C


a. Effects b. Journal Entries

Date Increase Decrease Debit Credit

owner's equity
2/9 assets

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CONFIDENTIAL AC/DEC2023/ACC117/106

expense
5/9 liability

7/9 assets

9/9 assets

12/9 assets expense

15/9 assets

17/9 owner'
equity
20/9 expense owner's
equity
22/9 expense owner'
liability equity
25/9 assets

26/9 assets liability

28/9 revenue
assets
30/9 owner'
equity

31/9 assets

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CONFIDENTIAL AC/DEC2023/ACC117/106

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