Accounting Answers

Show the journal entries necessary to correct the following errors:

(a) A sale of goods £412 to T More had been entered in T Mone’s account.

(b) The purchase of a machine on credit from J Frank for £619 had been completely omitted from our books.

(c) The purchase of a computer for £550 had been entered in error in the Office Expenses account.

(d) A sale of £120 to B Wood had been entered in the books, both debit and credit, as £102.

(e) Commission received £164 had been entered in error in the Sales account.

(f ) A receipt of cash from T Blair £68 had been entered on the credit side of the cash book and

the debit side of T Blair’s account.

(g) A purchase of goods £372 had been entered in error on the debit side of the Drawings

account.

(h) Discounts Allowed £48 had been entered in error on the debit side of the Discounts Received

account.

​Aug​2​Sold goods to Mwereka Traders in the amount of shs. 850,000 on account, invoice No. 331.

​​3​Sold goods to Pata Potea in the amount of shs. 145,000 for cash.

​​9​Sold goods on credit to Akika in the amount of shs. 4,350,000 invoice no. 332.

​​12​Collected amount due from Mwereka Traders.

​​15​Sold goods to Dalali Kombo on account for shs. 1,500,000 invoice no. 333.

​​18​Miscellaneous cash sales for the day amounted to shs. 333,000.

​​22​Collected amount due from Akika.

​​25​Collected the amount due from Dalali Kombo.

​​27​Sold goods on credit to Chekanao Enterprises in the amount of shs. 4,000,000 invoice No. 334.

​​28​Sold goods on account to Tatunane Motors amounting to shs. 750,000 invoice no. 335.

​Required:

​Using a Sales Journal and a Cash Receipts Journal as illustrated in the chapter record the preceding transactions for the month of August 200X; and post to the respective ledgers.

Below are the values of Inventory transactions relating to PESAKULANGA Business in the month of November 2019. Applying the FIFO Method of inventory accounting; Calculate the values in Dollars for Both Cost of goods sold and Closing inventory for the year ended

Food for thought 16:

(a) Differentiate between Stock Taking and Stock Control               

(b) From the following Table calculate the closing inventory value in TZS in trade that would be shown in the financial statements under a periodic method using FIFO system at the end of the trading period.                                   

Beginning Inventory were 10Units at a cost price of TZS 120 each​

Transaction Type

Number of Units

Unit Cost (TZS)

Purchased

60

1,350

Sold

40

Purchased

70

1,430

Sold

40

Sold

50

Purchased

60

1,510

An accountant has debited an asset account for $35000 and credited a revenue account for $50000. What can be done to complete the recording of the transaction?

Credit another asset account for $15000.

Nothing further can be done.

Credit a shareholders’ equity account for $15000.

Debit another asset account for $15000.

Which of the three documentation methods (BPDs, flowcharts, and DFDs) would be most useful to management? To company accountants? To external auditors? To a software engineer developing a new system? For each person, explain your answer. Write a 100 word response.

The text uses only a limited set of the many symbols that can be used to draw a BPD. If you could add five symbols to those listed in the text, what five processes or activities would you want the symbols to represent? Write a 100 word response.

John, age 10, found an old baseball glove while exploring an old shed on the property of his new home. His Father, Jerome took the glove to a dealer in baseball memorabilia who verified the glove belonged to Babe Ruth. Jerome sold the glove for $75,000.

• What tax issues should Jerome consider? Write a paragraph
• Is John the owner of the glove? Should he be taxed on the proceeds? Write a paragraph
• Does John giving the glove to Jerome constitute an assignment of income? Write a paragraph

The profit after tax for Barstead for the year ended 30 September 2009 was $15 million. At 1 October 2008 the company had in issue 36 million equity shares and a $10 million 8% convertible loan note. The loan note will mature in 2010 and will be redeemed at par or converted to equity shares on the basis of 25 shares for each $100 of loan note at the loan-note holders’ option. On 1 January 2009 Barstead made a fully subscribed rights issue of one new share for every four shares held at a price of $2·80 each. The market price of the equity shares of Barstead immediately before the issue was $3·80. The earnings per share (EPS) reported for the year ended 30 September 2008 was 35 cents. Barstead’s income tax rate is 25%. Required: Calculate the (basic) EPS figure for Barstead (including comparatives) and the diluted EPS (comparatives not required) that would be disclosed for the year ended 30 September 2009

Sales (40,000 units @ Br. 25 each) ............                   Br. 100,000

Less: Variable Costs..............................                               70,000

Contribution Margin .............................                             30,000

Less: Fixed Costs .................................                              18,000

Net Profit ..........................................                                       12.000

1. The sales needed to earn a profit of 20% on sales

Latesha​, a single​ taxpayer, had the following income and deductions for the tax year 2021.

Compute Latesha's taxable income and federal tax liability for 2021 ​(round to dollars and ignore the qualified business income deduction and​ self-employment taxes for this​ problem).

Salary $100,000

Business income $25,000

Interest income from taxable bonds $10,000

Interest income from tax-exempt bonds $5,000

Total income from whatever source derived $140,000

Minus: Exclusions, as provided in the tax law

 Interest income from tax-exempt bonds -($5,000)

Gross income $135,000

Minus: Deductions for Adjusted gross income

 Business expenses $?

Adjusted gross income (AGI) $?

Minus: Deductions from AGI:

 Account name? $?

Account name? $?

Taxable income $?

Tax $?