Test ACC106 August 2016

PART A

This part consists of 10 multiple-choice questions. Choose the most suitable answer and
write it in the answer booklet provided.

1. Which of the following statement does not describe a sole proprietorship?

A. The business is registered under the Business Registration Act 1957.

B. The owners are between 1 to 20 persons.
C. The financial records are not required to be published.
D. The owner are personally liable for business debts.
(1 mark)

2. Which of the following is Current Liability?

A. Mortgage Loan
B. Product Patent
C. Account Payables
D. Account Receivables
(1 mark)

3. Aifaa buys goods from Daniel for RM5,500. She returns half of the goods on 15 August.
Which of the following journal entry to record for the return of the goods in Daniels
books?

A. Dr Account Payables: Daniel Cr Return Outwards

B. Dr Return Inward Cr Account Receivables: Aifaa
C. Dr Account Payables: Aifaa Cr Return Outwards
D. Dr Return Inward Cr Account Receivables: Daniel
(1 mark)

4. Calculate the LIABILITY for the accounting equation below:

Capital RM85,000 Expenses RM45,224
Revenue RM75,500 Asset RM166,000

A. RM50,724
B. RM51,224
C. RM111,276
D. RM371,724
(1 mark)

5. Which of the following statements defined Non-Current Asset?(ASSETS THAT CANNOT

CONVERT TO CASH EASILY) (LESS TRANSACTION)

A. Asset with no physical substance.

B. Asset that either cash or those that can be converted into cash within one year.
C. Fund supplied by the owner to the business for the acquisition of assets.(CAPITAL)
D. Asset acquired or bought not for resale but to be used in operations of the business
with useful lives of more than one year.
 (1 mark)

6. Accounting policy or method once adopted should be followed in the subsequent periods
to allowed comparison to be made, is based on the __________ concept.

A. Materiality
B. Consistency
C. Accrual accounting
D. Business entity
(1 mark)

7. The Statement of Profit or Loss is prepared with the main purpose of:

A. To show the cash movements of the business

B. To show the financial transactions entered into by the business
C. To show the financial performance of the business (NET PROFIT/NET LOSS)
D. To show the financial position of the business.
(1 mark)

8. Which of the following journal entries correctly records the credit purchase of plant and
equipment?

A. Dr Purchase Account Cr Plant and Equipment.

B. Dr Cash Cr Plant and Equipment.
C. Dr Plant and Equipment Cr Account Payable.
D. Dr Plant and Equipment Cr Cash.
(1 mark)

9. "For accounting purpose, the proprietor of enterprise is always considered to be

separated and distinct from the business which he or she controls or owns". From the
following accounting concepts, which concept that refers to the above statement?

A. Going Concern concept

B. Money Measurement concept
C. Historical Cost concept
D. Business entity concept
(1 mark)

10. How should discounts which are allowed to customers for early settlement be treated
when the statement of profit or loss is prepared?

A. As an expense deducted from gross profit.

B. As an expense included in cost of sales.
C. As a deduction from the value of sales.
D. As a deduction from the value of discount received.
(1 mark)
(Total: 10 marks)
PART B

QUESTION 1

Starlight Enterprise established in July 2016, is a business that provide lighting solutions to
match the customer home dcor, offices, restaurants and many more. The business is selling
variety types of lamps, ceiling lights, ceiling fans, wall lights and outdoor lights with a unique and
attractive design. The business also provides services such as repair services, consultancy
services and delivery services. Encik Adib Zaim the owner, brought into the business a cash of
RM40,000 and a used van costing RM70,000. He also applied for a loan of RM100,000 from
ABC Bank which was approved and used as capital in the business.

Required:

a. State TWO (2) characteristics possessed by Starlight Enterprise.

(2 marks)

b. Identify TWO (2) assets and TWO (2) revenues from the above information.
(2 marks)

c. Calculate the initial capital of Starlight Enterpise.

(1 mark)
(Total: 5 marks)

QUESTION 2

Turkish Delights owned by Puan Salihah is a caf selling different Turkish cuisine in Kuala
Lumpur. The following are the business transactions for the month of July 2016.

Date Transaction:
July Puan Salihah deposited her personal savings RM 50,000 into the business
1 bank account .

5 Bought office furniture worth RM20,000 on credit from Ikea Berhad.

6 Purchase goods worth RM10,000 and paid by cheque To Puan Edith.

Received trade discount RM500.

8 Bought goods from JB Mill Bhd amounted RM21,000 on credit.

13 Credit sales of RM10,000 to Ayman Enterprise.

14 Puan Salihah withdrew goods worth RM400 for her personal use.
 15 Returned defective unit to JB Mill valued at RM1,000 because of wrong
specification.
17 Paid JB Mill Bhd for the amount due by cheque.

23 Paid salaries to workers amounting RM2,000 by cheque

30 Ayman Enterprise made payment by cheque .

Required:

Note: Use the following format:

Example: Sept 28 received commission RM800 cash.

Date Accounting Effects Journal entry

Asset Expenses Liability Revenues Owners Debit Credit
Equity

Sept Increase Increase Cash Commission

28 RM800 received
RM800

a. Identify the effects (increase or decrease) on asset, expenses, liability, revenues and
owners equity for each of the transaction above.
(10 marks)

b. Show the accounts to be debited and credited for each of the transactions above.
(10 marks)

(Total: 20 marks)
QUESTION 3

Below is the trial balance of Sutra Enterprise for the year ended 31 March 2016:

Debit (RM) Credit (RM)

Account receivables and payables(SOFP) 15,000 20,000
Bank overdraft(SOFP) 2,000
Capital as at 1 Jan 2015(SOFP) 451,720
Carriage inwards(SOPL) 1,200
Carriage outwards(SOPL) 2,000
Cash(SOFP) 12,000
Drawings (SOFP) 1,700
Fines and penalties(SOPL) 1,000
Fixed deposit(SOFP) 80,000
Fixture and fittings(SOFP) 50,000
Interest on bank overdraft(SOPL) 120
Interest on fixed deposit(SOPL)(REVENUE) 4,000
Interest on loan(SOPL) 12,500
Land and building(SOFP) 500,000
Long term loan(SOFP) 250,000
Patents(S0FP) 100,000
Purchases and sales(SOPL) 270,000 350,000
Rental received(SOPL) 6,000
Return inwards and outwards(SOPL) 35,000 27,000
Salaries and wages(SOPL) 17,500
Stock(SOPL) 8,000
Utilities(SOPL) 4,700
1,110,720 1,110,720

Stock as at 31 March 2016 is RM10,000.(SOPL)(SOFP)

You are required to prepare:

a) Statement of Profit and Loss and Other Comprehensive Income for the year ended 31
March 2016. (Key answer: Net profit RM44,980)
(8 marks)

b) Statement of Financial Position as at 31 March 2016. (Key answer: RM767,000)

(7 marks)

(Total : 15 marks)
 Test ACC106 - February 2017
PART A

This part consists of 10 multiple-choice questions. Choose the most suitable answer and
write it in the answer booklet provided.

1. Which of the type of business organization has the following characteristics:

No separate legal entity from its owner
The owner personally liable for the debt of the business
Owned by 2 20 persons

A. Public company
B. Private company
C. Sole proprietorship
D. Partnership
(1 mark)

2. The owners equity will decrease when

A. A business incurred net loss

B. The owner transfer in RM500 from his personal account to business account
C. The owner paid the supplier with his own cash
D. The business obtained net profit

(1 mark)
3. The sales journal is
A. Used to record all sales
B. Used only to record credit sales Commented [H1]: Suggestion: credit sales of inventory OR
C. Used to record cash payment credit sales of goods
D. All of the above
(1 mark)

4. Which of the following statements are INCORRECT?

Debit Credit
A. Bought motor van by cheque Motor Van Bank
B. Sold inventories on credit Accounts Payable Sales
C. Took cash out of business for private use Drawing Cash
D. Paid general expenses by cheque General expenses Bank

(1 mark)
5. What are the effects to the accounting equation when the business sold goods on
credit?

A. Asset and Revenue increase

B. Asset and Revenue decrease
C. Asset increases and Revenue decreases
D. Asset decreases and Revenue increase
(1 mark)

6. Bookkeeping comprises of the below mentioned processes EXCEPT:

A. Classifying
B. Recording
C. Summarising
D. Interpreting
(1 mark)

7. Alissa Enterprise had a total assets of RM400,000 and owner's equity of RM208,000 at
the beginning of the year. During the year, assets increased by RM52,000 and liabilities
decreased by RM82,000. What is the amount of owner's equity at the end of the year?

A. RM370,000
B. RM342,000
C. RM338,000
D. RM178,000

(1 mark)

8. Which of the following would not be shown on a Statement of Financial Position?

A. Accounts Receivable
B. Accounts Payable
C. Sales
D. Cash
(1 mark)

9. The process of transferring transaction into the appropriate accounts is referred to as:
A. Closing.
B. Journalising.
C. Recording.
D. Posting
(1 mark)
 10. Farhan owes Radin Enterprise RM100. When he went to settles his debt(DISCOUNT
ALLOWED), he is only required to pay RM80. In the book of Radin Enterprise, what
does the difference of RM20 represent?

A. A trade discount of RM20.

B. A discount received of RM20.
C. A discount allowed of RM20.
D. A discount receivable of RM20.
(1 mark)

(Total: 10 marks)

PART B

QUESTION 1

Nazrul, Syukri, Aeinuddin and Firdaus are certified accountants and decided to open up a
business. They plan to set their business at Bandar Baru Tangkak and offer services such as
auditing, taxation, accounting and secretarial.

Required:
a. What is the type of business which Nazrul, Syukri, Aeinuddin and Firdaus can form
together?
(1 mark)

b. State TWO (2) disadvantages of this form of business organisation.

(2 marks)

c. Give TWO (2) external users of accounting information.

(2 marks)
(Total: 5 marks)
QUESTION 2

Sakina is the owner of Shuuzz Awesome, a shoe outlet in Bandar Baru, Segamat. The following
transactions relate to Shuuzz Awesome activities in the first month of its business:

Date Transactions
2017
Jan 1 Sakina contributed her personal computer worth RM3,000 and deposited
RM60,000 into the business bank account to commence the business.

2 Purchased shoe display racks worth RM6,000 from Display King Trading on
credit.

3 Issued a cheque for shoes purchased from Heels Enterprise worth RM5,000 and
were given RM250 trade discount.

10 Returned 10 pairs of shoes that were damaged costing RM500 to Heels

Enterprise.

15 The business made cash sales of RM4,500.

20 Sakina took RM50 cash and a pair of shoes worth RM120 for her own use.

27 Sold shoes RM1,050 on credit to Ana, a shoe retailer at the night market after
deducting a trade discount of RM150.

28 Paid by cheque 50% of the amount outstanding to Display King Trading.

30 Electricity bill for the month of RM200 was paid by cash.

Note: Use the following format:

Example: January 31 Paid shop rent for the month RM1,500 by cheque.

Date Asset Expense Capital Liability Revenue Journal entry

Jan Decrease Increase Dr. Rent expense
31 Cr. Bank

Required:

a. Identify the effects increase (+) or decrease (-) for each of the transaction given above.
(10 marks)

b. Give the journal entries for each of the transactions.

(10 marks)
(Total: 20 marks)
QUESTION 3

En Dan, the owner of Matt Dani Enterprise has the following accounts balances as at 31
December 2016.

Debit (DR) Credit (CR)

Capital (OE)(SOFP) 40,000
Drawings(OE)(SOFP) 100
Purchases and Sales(SOPL) 25,000 60,000
Returns (SOPL) 1,000 1,500
Discounts (SOPL) 500 2,000
Stock, 1 January 2016(SOPL) 2,000
Shop Building(NCA)(SOFP) 50,000
Delivery Van(NCA)(SOFP) 35,000
Accounts Receivables and
1,500 8,000
Payables(CA)(CL)(SOFP)
Bank overdraft(SOFP) 8,000
Motor repairs(SOPL) 3,400
Electricity(SOPL) 4,500
Cash in hand(SOFP) 5,000
Cash at bank(SOFP) 20,000
Duty on purchases(SOPL) 1,500
Salaries and wages(SOPL) 12,000
Commission received (SOPL) 1,000
Patents(SOFP)(NCA) 8,000
Carriage outwards(SOPL) 1,000
Mortgage on Premises(SOPL) 50,000
170,500 170,500

Stock as at 31 December 2016 is RM5,000.

You are required to prepare:

a. Statement of Profit or Loss for the year that ended 31 December 2016.
(Key answer: Net profit RM18,600)
(8 marks)

b. Statement of Financial Position as at 31 December 2016. (Key answer: RM124,500)

(7 marks)

(Total : 15 marks)
 Test ACC106 - February 2017
PART A
This part consists of 10 multiple-choice questions. Choose the most suitable answer and write it
in the answer booklet provided.

1. All the following characteristics are suitable for limited companies EXCEPT?

A. The capitals are in the form of ordinary shares.

B. A maximum of 50 persons could own the company.
C. The liability is unlimited.
D. Registered under Companies Act 1965.
(1 mark)

2. The accounting process involves all the followings except:

A. Identifying economics transactions that are relevant to the business.

B. Analyzing and interpreting financial reports.
C. Communicating the financial information to the users by preparing a report.
D. Recording non quantifiable economic events.
(1 mark)

3. One advantage of recording transaction in a journal is?

A. To show the financial performance of the business.

B. To provide a chronological record of business transactions.
C. To reduce the workload of a bookkeeper.
D. To show the financial position of the business.
(1 mark)

4. The following accounts have credit balances except?

A. Account payables.
B. Loan to Ali.
C. Bank overdraft.
D. Loan from JJ Bank.
(1 mark)

5. The purpose of trial balance is

A. To facilitate the preparation of financial statements.

B. To help detect errors within a given period of time.
C. To check accuracy of the double entry rules.
D. All of the above.
(1 mark)
6. Based on __________, capital contributed by the owner considered as liability to the
business?

A. Going concern concept.

B. Consistency concept.
C. Accrual accounting concept.
D. Business entity concept.
(1 mark)

7. All the followings are considered as business transactions and will be recorded in the
businesss account except:

A. Paid utilities expenses for office use.

B. Withdrew RM500 cheque from businesss bank account for personal use.
C. Paid owners education loan from owners personal credit card.
D. Purchase goods form Hana on credit
(1 mark)

8. What is the effect of the transaction when a business purchase asset on credit?

A. Increase in expenses and increase in asset.

B. Increase in expenses and decrease in asset.
C. Increase in expenses and increase in liabilities.
D. Increase in asset and increase in liabilities.
(1 mark)

9. Which of the following is correct?

Asset(RM) Liabilities(RM) Capital(RM)

A. 10,000 20,000 40,000

B. 105,000 40,000 65,000
C. 15,000 40,000 25,000
D. 33,330 11,111 44,441
(1 mark)

10. If the expenses is understated by RM10,000, what is the effect on net profit?

A. Net profit will increase by RM10,000.

B. Net profit will decrease by RM10,000.
C. Net profit will increase by RM20,000.
D. Net profit will decrease by RM20,000.
(1 mark)
 (Total: 10 marks)

PART B

QUESTION 1

Hafiz Sounds and Services, is a music store located in Johor Bahru. The business is registered
as a sole proprietorship. The business sells high-quality branded drum sets, electric, acoustic
and bass guitars, pianos, keyboards and ukuleles to top-notch brass and woodwind
instruments, violins, cellos, amplifiers and PA systems for pro, semi-pro and amateur musicians.
The business also offers services such as installing electrical musical instruments and repair
services. The business emphasizes on offering high quality musical instruments at great value.

The owner Mr Hafiz, contributed RM30,000 from his savings to start the business. The overall
initial funding needed is RM100,000.

Required:

a. State TWO (2) characteristics possessed by Hafiz Sounds and Services.

(2 marks)

b. State ONE (1) weakness possessed by Hafiz Sounds and Services.

(1 marks)

c. Calculate the amount borrowed by Hafiz to start the business.

(2 mark)
(Total: 5 marks)
QUESTION 2

Bling Bling Enterprise is a business selling high quality Korean made imported brooch owned
by Puan Diva, started its operations on 1 January 2016 .Given below are the transactions of
Bling Bling Enterprise for the month of January 2016 .

Jan 1 Puan Diva brought in RM100,000 cash and deposited the money into business
bank account.
3 Purchased delivery van from Second-Hand Dealer Bhd worth RM50,000 on
credit.
5 Purchased furniture worth RM5,000 from KSL Furniture and paid by cheque
immediately. Received trade discount of 10%.
7 Purchased goods worth RM10,000 from Branded Gems Bhd on credit.
8 Returned defective goods to Branded Gems Bhd amounting to RM1,000 .
10 Puan Diva took goods worth RM250 from the business for her personal use.
13 Sold goods to Che Det Enterprise worth RM2,500 by cash.
22 Paid the amount owed to Branded Gems Bhd by cheque.
25 Received cash of RM250 being commission received from Dash Bhd.
30 Paid utilities bill amounted to RM500 by cheque.

Note: Use the following format:

Example: Jan 28 Sold goods worth RM800 on credit to Pn. Aminah.

Accounting Effects Journal entry

Date
Increase Decrease Debit Credit
2014 Asset AR: Pn. Sales
Jan 28 Revenue Aminah

Required:

a. Identify the effects (increase or decrease) on asset, expenses, liability, revenues and
owners equity for each of the transaction above.
(10 marks)

b. Show the accounts to be debited and credited for each of the transactions above.
(10 marks)
(Total: 20 marks)
QUESTION 3

The following Trial Balance was extracted from the books of Gift Paradise as at 31 December
2015.

Debit Credit
Particulars
(RM) (RM)
Accounts Receivable and Accounts Payable(SOFP) 58,800 32,200
Capital(SOFP) 200,000
Cash at Bank(SOFP) 47,600
Purchases and Sales(SOPL) 653,000 750,500
Inventory as at 1 January 2015(SOPL) 84,400
Returns(SOPL) 7,560 5,040
Rent Received(SOPL) 7,500
Commission(SOPL) 2,250 3,500
Delivery Van(SOFP) 90,000
Furniture and Fittings(SOFP) 45,500
Office Equipment(SOFP) 24,800
Accumulated Depreciation:
- Delivery Van(SOFP) 18,000
- Furniture and Fittings(SOFP) 9,100
- Office Equipment(SOFP) 2,480
Short Term Loan from AB Finance(SOFP) 8,000
Carriage Outwards(SOPL) 1,290
Carriage Inwards(SOPL) 2,600
Discounts(SOPL) 11,200 14,500
General Expenses(SOPL) 4,300
Import Duties(SOPL) 3,300
Salaries(SOPL) 25,600
Interest on loan(sopl) 2,450
Fixed Deposit(SOFP) 18,000
Interest on Fixed Deposit(SOPL) 1,780
Advertisement(SOPL) 1,900
Utilities Expenses(SOPL) 1,750
Drawings(OE) 8,800
Mortgage Loan(NCL)(SOFP) 42,500
1,095,100 1,095,100

Inventory as at 31 December 2015 is RM61, 200.

Required:
a. Statement of Profit or Loss for the year ended 31 December 2015.
(Key answer: Net profit RM42,420)
(8 marks)
b. Statement of Financial Position as at 31 December 2015. (Key answer: RM316,320)
(7 marks)
(Total: 15 marks)