ADMINISTRATION 1

CHAPTER 1 GENERALISATION OF ACCOUNTING

Exercise 1: The amount of assets, liabilities and owner’s equity at the end of the year
200X for Hoàng Minh Company are listed below:

Accounts receivable – trade 40.000

Bonus & welfare funds 20.000
Capital construction in process 100.000
Cash 80.000
Cash in bank 50.000
Construction investment fund 100.000
Financial reserve funds 30.000
Finished goods 200.000
Goods in transit 10.000
Intangible fixed assets 200.000
Investment & development funds 20.000
Joint venture capital contribution 50.000
Long-term borrowing 400.000
Long-term deposits received 10.000
Merchandise inventory 100.000
Other long term investments 100.000
Other payable 15.000
Other receivable 10.000
Other short - term investment 30.000
Payable to employees 30.000
Payable to seller 40.000
Raw materials 50.000
Short-term loan 200.000
Tangible fixed assets 400.000
Taxes and payable to state budget 30.000
Tools and supplies 100.000
Undistributed earnings 50.000
Work in progress 40.000
Working capital x
Required:
1- Determine Hoang Minh Company’s working capital at the end of the year.
2- Determine the total assets; owner’s equity and liabilities.

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Exercise 2- Use the accounting equation to answer each question below. Show any
calculations you make:
1- The Assets of Minh Anh Company are 650.000, the owner’s equity is 360.000.
What is the amount of the liabilities?
2- The liabilities and owner’s equity of Ba Tam Company are 95.000 and 32.000
respectively. What is the amount of the assets?
3- The liabilities of Co Chin Co. equal one-third of the total assets and owner’s
equity is 120.000. What is the amount of the liabilities?
4- At the beginning of the year, Co Hue Company’s assets were 220.000 and its
owner’s equity was 100.000. During the year, assets increased 60.000 and
liabilities decreased 10.000. What was the owner’s equity at the end of the year?
Exercise 3- The total assets and liabilities at the beginning of the year for Hoang Thien
Company are listed below:
Assets Liabilities
Beginning of the year 110.000 45.000
End of the year 200.000 120.000

Determine Hoang Thien Company’s net income for the year under each of the following
alternatives:
1- The owner made no investments or withdrawals from the business during the year.
2- The owner made no investment in the business but the owner withrew 22.000
during the year.
3- The owner made the investment of 13.000 but made no withdrawals during the
year.
4- The owner made an investment of 10.000 in the business and withdrew 22.000
during the year.
Exercise 4- Lan Hue Shop uses a large amount of supplies in its bussiness. The following
table summarizes selected transaction data for orders of supplies purchased:
Order Date shipped Date received Amount
A April 28 May 7 300
B May 8 May 13 750
C May 10 May 16 400
D May 15 May 21 600

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E May 25 June 1 750

F June 3 June 9 500

Determine the total purchases of supplies for May alone under of wich following
assumptions:
- Lan Hue shop recognizes purchases when orders are shipped.
- Lan Hue Body shop recognizes purchases when orders are received.
Excercice 5- At the beginning of the January, Hoang Hoa Company paid 3 months’rent in
advance, 1.500. This expenditure resulted in an asset consisting of the right to occupy the
office for three months. What the amount of the rent expense for the month of January?
Exercice 6- During the month of January, Minh Anh Company received 3.000 as an
advance payment for three months’ rent. What the amount of the rent revenue for the
month of January?

CHAPTER 2- FINANCIAL STATEMENTS

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Exercise 1: The amount of assets, liabilities and owner’s equity at the end of December
for Hoang Lan Company are listed below:

Cash 50.000
Accounts receivable – trade 80.000
Bonus & welfare funds 15.000
Cash in bank 200.000
Financial reserve funds 10.000
Finished goods 150.000
Goods in transit 15.000
Intangible fixed assets 40.000
Investment & development funds 50.000
Long-term borrowing 200.000
Merchandise inventory 60.000
Other long term investments 30.000
Other payable 5.000
Other receivable 20.000
Other short - term investment 50.000
Payable to employees 10.000
Payable to seller 45.000
Raw materials 25.000
Short-term loan 100.000
Tangible fixed assets 300.000
Taxes and payable to state budget 15.000
Tools and supplies 10.000
Undistributed earnings 20.000
Work in progress 25.000
Working capital x
Required:
1- Determine the working capital at the end of December.
2- Determine the total assets; owner’s equity and liabilities.
3- Prepare the Hoang Lan Company’s Balance sheet at the end of December.
Exercise 2: The amount of assets, liabilities and owner’s equity at the end of November
for Hoa Ha Company are listed below:

Cash 50.000
Accounts receivable – trade 80.000

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Cash in bank 100.000

Finished goods 150.000
Long-term borrowing 200.000
Merchandise inventory 60.000
Payable to employees 10.000
Payable to seller 45.000
Raw materials 25.000
Tangible fixed assets 300.000
Tools and supplies 10.000
Working capital x

During the month of the December, the following transations were completed:
1- Investment by owner, Hoa Ha, 20.000
2- Purchased raw materials for cash in bank 50.000.
3- Paid cash for tool and supplies 20.000
4- Purchased land using right on credit 100.000.
5- Took cash in bank out of the business for personal expenses 10.000.
6- Received cash in bank from the bank short- term loan: 40.000
7- Made a partial payment on the land using right purchased in transaction 4, 40.000.
8- Paid the long-term borrowing by cash 40.000.
9- Paid the seller by cash for the previously material: 30.000
10- Paid salaries to the employees by cash 10.000.
11- Sold on credịt one-half of merchandise inventory at a price of 40.000.
12- Sold on credit complete merchandise inventory at a price of 10.000.
Required:
1- Prepare a balance sheet at the end of November.
2- Prepare a balance sheet after each transaction of December.
Exercise 3: Determine the amounts that correspond to the letters by completing the
following independent sets of fanancial statements. (Assume no new investments by the
owners).
Income statement Set A Set b Set C
Revenues 1.100 G 240
Expenses A 5.200 M
Net income B H 80

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Statement of owner’s equity

Beginning Balance 2.900 15.400 200
Net income C 1.600 N
Less withdrawals (200) I O
Ending Balance 3.000 J P
Balance Sheet
Total assets D 21.000 Q
Liabilities 1.600 5.000 R
Owner’s equity E K 280
Total liabilities and owner’s Equity F l 480

Exercise 4: At the end of its first month of operation, march 20xx, Ben Xuan Company
had the folowing account balances:

Cash 58.600
Accounts receivable 10.800
Tangible fixed assets 38.000
Tools and supplies 7.600
Accounts payalbe 8.600

In addition, during the month of March, the following transactions affected owner’s
equity:

Investment by Ben Xuan 40.000

Withrawal by BenXuan 4.000
Further Investement by BenXuan 60.000
Contract Revenue 23.200
Repair revenue 5.600
Salaries expense 16.600
Rent expense 1.400
Fuel expense 400
Required: prepare an income statement, a statement of owner’s equity and a balance sheet
for Ben Xuan Company.
Ben Xuan Company
Income statement For the month ended March 31 20xx

Revenus

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Contract revenue
Repair revenue
Expenses
Salaries expense
Rent expense
Fuel expense
Total expense
Net Income
Ben Xuan Company
Statement of owner's equity For the month ended March 31 20xx
Ben Xuan, Capital, march
1, 200X
Add
Investment by BXuân
Net Income for the
month
Subtotal
Less
Withdrawals by Ellis
Ben Xuan, Capital, march
31, 200X
Ben Xuan Company
Balance Sheet For the month ended March 31 20xx
Equity and
Assets liabilities

Exercise 4- Identify the following transactions by making each an owner’s investment (I),
owner’s withdrawal (W), revenu (R), Expense (E) or not an owner’s equity transaction.
1- Reveived cash for providing a service
2- Tooks assets out of the business for personal use.
3- Received cash from a customer previously billed for a service.
4- Transferred assets to the business from a personal account.
5- Paid a service station for gasoline for business vehicle.
6- Performed a service and received a promise of payment.
7- Paid cash to purchase equipment.
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8- Paid cash to an employee for services perfomed

CHAPTER 3 &4: ACCOUNTS & DOUBLE-ENTRY SYSTEM
Exercise 1: Which of the following events would be recognized and recoded in the
accounting records of the Sabatini Company on the date indicated:
1- Sabatini Company offers to purchase a tract of land for 280.000. There is a high
likelihood his offer will be accepted.
2- Sabatini Company receives notice that its rent will be increased from 1.000 per
month to 1.200 per month effective April 1.
3- Sabatini Company receives its utility bill for the month of April. The bill is not
due until May 10.
4- Sabatini Company places a firm order for the new office equipment costing
42.000.
5- The office equipment ordered on transaction 4 arrives. Payment is not due until
September
Exercise 2: Listed below are the ledger accounts of the Khanh Minh service Company:
1 Cash 11 Prepaid insurance
2 accounts receivable 12 Utility expense
3 Khanh Minh, Capital 13 Unearned Revenues
4 Khanh Minh, withdrawals 14 Office equipment
5 Service revenue 15 Rent payable
6 Prepaid rent 16 Notes receivable
7 Accounts payable 17 Interest expense
8 Investments in Stocks and Bonds 18 Notes payable
9 Land 19 Supplies
10 Supplies expense 20 Interest receivable

Complete the following table, indicate with two Xs for each accounts its classification
and its normal balance (whether a debit or credit increases the account):

Type of account Increases balance

Owner's Owner's
Iterm Asset Liability Capital withdrawals Revenue Expense Debit Credit

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Exercise 3: Analyze of the following transactions, using the form shown in the example
below the list.
1- Minh Anh established Minh Anh’s Barber Shop by placing 2.400 in a bank
account.
2- Paid two month rent in advance, 840.
3- Purchased supplies on credit, 120.
4- Received cash for barbering services, 100.
5- Paid for supplies purchased in 3.
6- Paid utility bill, 72.
7- Took cash out of the business for personal expenses, 100.
Example: The assets cash was increased. Increases in assets are recorded by debits. Debit
cash, 2.400. A component of owner’s equity, Minh Anh Capital was increased. Increases
in owner’s equity are recorded by credits. Credit Minh Anh Capital, 2.400.

Exercise 4- During the month of April, Buom Hoa Company had the following
transactions:
1- Paid salaries for April 5.400.
2- Purchased equipment on credit 9.000.
3- Purchased supplies with cash 300.
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4- Additional investment by owner 12.000

5- Received payment for services perfomed 1.800.
6- Made partial payment on equipment purchased in transaction 2, 3.000.
7- Billed customers for services perfomed 4.800.
8- Cash withdrawal by owner 4.500.
9- Received payment from customers billed in transaction 7, 900.
10- Received utility bill, 210.
On a sheet of paper, list the numbers 1 through 10, with colums labeled Assets,
Liabilities and owner’s equity. In the columns, indicate whether each transaction caused
an increase (+), an decrease (-), or not change (NC) in assets, liabilities and owner’s
equity.
Exercise 5- For each of the following categories, decribe a transaction that would
have the required effect on the elements of the accounting equation:
1. Increase one asset and decrease another asset.
2. Decrease an asset and decrease a liability.
3. Increase an asset and increase a liability.
4. Increase an asset and increase owner’s equity.
5. Decrease an asset and decrease owner’s equity.
Exercice 6: Indicate below whether each of the following accounts is an asset, a liability,
a part of owner’s equity, an expense, a revenue, a contra account:
1- Cash
2- Accounts receivable
3- General and administration expenses
4- Depreciation of fixed assets.
5- Payable to employees
6- T. Booth, Capital
7- Land
8- Accounts payable
9- Investment and development funds
10- Other expenses
11- Supplies
12- Cost of goods sold
13- Other receivable
14- Devaluation of sale price
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15- Other long-term investment.

Exercice 7: Indicate below whether each account would be shown on the income
statement, the statement of owner’s equity or the balance sheet:
1- Cash
2- Accounts receivable
3- General and administration expenses
4- Depreciation of fixed assets.
5- Payable to employees
6- T. Booth, Capital
7- Land
8- Accoutns payable
9- Investment and development funds
10- Other expenses
11- Supplies
12- Cost of goods sold
13- Other receivable
14- Devaluation of sale price
15- Other long-term investment.
Exercise 8- The amount of assets, liabilities and owner’s equity at the end of November
for Hoa Ha Company are listed below:

Cash 50.000
Cash in bank 100.000
Finished goods 150.000
Long-term borrowing 200.000
Payable to seller 45.000
Raw materials 25.000
Tangible fixed assets 300.000
Working capital x

During the month of the December, the following transactions were completed:
1- Investment by owner, Hoa Ha, 50.000
2- Purchased raw materials by cash in bank 30.000.
3- Paid cash for tool and supplies 5.000
4- Purchased on credit equipment and machines 20.000.

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5- Purchased land using right on credit 100.000.

6- Received cash in bank from the bank short- term loan: 40.000
7- Made a partial payment on the land using right purchased in transaction 5, 40.000.
8- Paid the long-term borrowing by cash in bank 40.000.
9- Paid the seller by cash in bank for the previously material: 30.000
10- Made a partial payment for the seller in transaction 4: 10.000
11- Sold one-half of inventory at a price of 40.000.
12- Sold complete inventory at a price of 10.000.
Required:
1- Record the transaction listed above in the T accounts.
2- Prepare a trial balance and a balance sheet at the end of the month.
Exercise 9- Ha Trang copying service began operations and engaged in the following
transactions during August 19xx:
1- Investment by owner, Mary Lomax, 10.000.
2- Paid current month’s rent, 900.
3- Purchased copier for cash, 5.000.
4- Copying job payments received in cash, 1.780.
5- Copying job billed to major customer, 1.360.
6- Paid cash for raw materials, 580.
7- Calculate salary for employees, 560.
8- Purchased tools and supplies on credit, 320.
9- Received partial payment from customer in transaction 5, 600.
10- Paid current month’s utility bill, 180.
11- Made partial payment on supplies purchased in transaction 8, 140.
12- Withdrew cash for personal use, 1.400.
13- Suppose that during the month, of the raw materials, tools and supplies purchased,
500 and 250 worth were used up; the depreciation for the month of copier is 50.
Required:
1- Record the transactions listed above in the T accounts.
2- Prepare a trial balance, an income statement, a statement of owner’s equity and a
balance sheet.
Exercise 10: This was the trial balance for Ben Xuan Services at the end of September:

BenXuan Services

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Trial Balance September 30, 19xx

Cash 3.840
Accounts Receivable 5.660
Supplies 120
Prepaid Insurance 180
Equipment 8.400
Accounts payable 4.540
Gilliam, Capital 11.560
Gilliam, withdrawals 700
Revenues 5.920
Salaries expense 2.600
Rent expense 600
Advertising expense 340
Utility expense 26
21.766 22.720

The trial balance does not balance because of a number of errors. Ben Xuan’s accountant
compared the amounts in the trial balance with the ledger, recomputed the account
balances and compared the posting. He found the following errors:
1- The balance of cash was understated by 400.
2- A cash payment of 420 was credited to cash for 240.
3- A debit of 120 to accounts receivable was not posted.
4- Supplies purchased for 60 were posted as a credit to Supplies.
5- A debit of 180 to prepare insurance was not posted.
6- The accounts payable account had debits of 5.320 and credits 0f 9.180.
7- The Note payable account, with a credit balance of 2.400, was not included I the
trial balance.
8- The debit balance of Ben Xuan , withdrawals was listed in the trial balance as a
credit.
9- A 200 debit to Ben Xuan withdrawals was posted as a credit.
10- The actual balance of utility expense, 260, was listed as 26 in the trial balance.
Prepare a correct trial balance.
Exercise 11- Ms Chiều Tím established a small business, Garcia Training Center, to teach
individuals how to use spreadsheet analysis, word processing, and other techniques on
microcomputers.
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1- Chiều Tím began by transferring the following assets to the business:

- Cash in bank: 18.400
- Furniture: 7.200
- Microcomputers: 9.600
2- Paid the first month’s rent, 560.
3- Purchased computer software on credit, 1.500.
4- Paid for an advertisement in the local newspaper, 200.
5- Received enrollment applications from five students for a 5 day course to start
next week. Each student will pay 400 if he or she actually begins the course.
6- Calculated salary for employees, 300.
7- Received cash payment from three of the students enrolled in 5, 1.200.
8- Billed the two other students in 5, who ettended but did not pay in cash, 800.
9- Paid the utility for the current month, 220.
10- Made a payment on the sofware purchased in 3, 500.
11- Received payment from one student billed in 8, 400.
12- Purchased a second lot of microcomputer for cash, 4.800.
13- Transferred cash to a personal checking account, 600.
14- The depreciation for the month of Furniture: 200; Microcomputers 600; Software:
50.
Required:
1- Record the transactions listed above by entering debits and credits directly in the
T accounts
2- Prepare a trial balance, an income statement, a balance sheet at the end of the
month.
CHAPTER 5- ACCOUNTING FOR MAJOR BUSINESS TRANSACTIONS
Exercise 1- Ben Xuan Company is a the manufacturer and seller of product
B. The amount of assets, liabilities and owner’s equity at the end of
November for Ben Xuan Company are listed below:
Raw materials 400.000
Tools and supplies 40.000
Work in progress 10.000
Tangible fixed assets 500.000
Working capital 950.000

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During the month of december, Ben Xuan Company completed the

following transations:

1- Calculated and recorded the value of raw materials used for:

 Manufacturing direct: 150.000
 Managing workshop: 20.000
 Selling staff: 15.000
 General & administration staff: 10.000
2- Recorded the value of tools and supplies for:
 Managing workshop: 15.000
 Selling staff: 10.000
 General & administration staff: 3.000
3- Calculated salary for:
 Direct labor staff: 80.000
 Managing workshop staff: 15.000
 Selling staff: 10.000
 General & administration staff: 40.000
4- Calculated and recorded retention on salaries.
5- The depreciation for the month of fixed assets allocated for:
 Manufacturing staff: 20.000
 Selling staff: 15.000
 General & administration staff: 10.000
6- Calculated and recorded the value of finished goods B. The quantity of
finished goods B manufactured during the month was 500 units. The
value of the work in progress at the beginning of the month was
10.000, at the end of the month was 15.000.

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7- Sold on account 400 units product B at a price exclusive of the VAT

of 400/unit.
Required.
1- Record the transactions listed below in the T accounts (expense
accounts, revenue accounts, finished goods, work in progress).
2- Establish an income statement.
Exercise 2- Binh An Company is a the manufacturer and seller of products A. At the end
of April 20XX, some of accounts showed the following balances:
 Raw materials X: 1.000 kg x 100/kg.
 Work in progress: 20.000
 Finished goods A: 300 units x 250/unit
During the month of May, Binh An Company completed the following transations:
1- Purchased on account 2.000 kg of raw materials X at the price exclusive of VAT
of 102/kg. Total included freight in of 6.000 (price exclusive of VAT), paid in
cash.
2- Calculated and recorded the value of raw materials used for:
 Manufacturing direct: 1.200 kg
 Managing workshop: 100 kg
 Selling staff: 50 kg
 General & administration staff: 50 kg.
3- Recorded the value of tools and supplies for:
 Managing workshop: 20.000
 Selling staff: 15.000
 General & administration staff: 5.000
4- Calculated salary for:
 Direct labor staff: 100.000
 Managing workshop staff: 30.000
 Selling staff: 40.000
 General & administration staff: 50.000
5- Calculated and recorded retention on salaries.
6- The depreciation for the month of fixed assets allocated for:
 Manufacturing staff: 10.000

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 Selling staff: 5.000

 General & administration staff: 5.000
7- Calculated and recorded the value of finished goods A. The quantity of finished
goods A manufactured during the month was 1.000 units. The value of the work in
progress at the end of the month was 15.000.
8- Sold on account 900 units product A at a price exclusive of the VAT of 600/unit.
Required.
1- Record the transactions listed below in the T accounts (expense accounts,
revenue accounts, finished goods, worf in progress).
2- Establish an income statement.
Assume that Binh An company used the FIFO method of inventory valuation.
Exercise 3-. At the end of April 20XX, some of accounts of Ngay Mua Company showed
the following balances:
 Merchandise inventory: 300 units A x 250/unit; 500 units B x 400/unit
During the month of May, Binh An Company completed the following transations:
1- Purchased on account 700 units of merchandises A at the price exclusive of VAT
of 250/unit. Total included freight in of 10.000 (price exclusive of VAT), paid in
cash.
2- Purchased and paid in cash 800 units of merchandises B at the price exclusive of
VAT of 415/unit. Total included freight in of 10.000 (price exclusive of VAT),
paid in cash.
3- Sold 800 units of A on credit at a price exclusive of the VAT of 400/unit.
4- Sold for cash 1.000 units of B at a price exclusive of the VAT of 600/unit.
5- Recorded the value of tools and supplies for:
 Selling staff: 15.000
 General & administration staff: 5.000
6- Calculated salary for:
 Selling staff: 60.000
 General & administration staff: 40.000
7- Calculated and recorded retention on salaries.
8- The depreciation for the month of fixed assets allocated for:
 Selling staff: 20.000
 General & administration staff: 15.000

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Required.
1- Record the transactions listed below in the T accounts (expense accounts,
revenue accounts).
2- Establish an income statement.
Assume that Ngay Mua company used the LIFO method of inventory valuation.

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