Maldives Business School
Cover Page
ASSIGNMENT BRIEF
Diploma in Accounting and Finance -Virtual
The student must fill the relevant parts of the following table.
Student First Name
Student
Name
Last
Student
ID
Task
No.
Date submitted
Date issued
10 February 2019
Statement of authenticity
I, the above named student, hereby confirm that this assignment is my own work and not copied or
plagiarized. It has not previously been submitted as part of any assessment. All the sources, from which
information has been obtained for this assignment, have been referenced in the Harvard format. I further
confirm that I have read and understood the Maldives Business School rules and regulations about
plagiarism and copying and agree to be bound by them.
Assignment summary information
Unit
Unit 6: Principles of Accounting
Assignment type
This is an individual assignment.
Tasks
Assignment reference
1
Submit on
Do on
19th July 2019
Task 1: Classroom Assessment: LO1, LO2
NA
Task 2: PowerPoint Presentation: LO3, LO4.
27th April 2019
4th May 2019
An extension must be applied for in writing by individual students and will only be
Extensions:
granted for valid reasons.
Late submissions: Late submissions will be marked for all grades but will incur a fine of MVR 500.
Resubmissions:
Each resubmission will be charged MVR 50.
Assessor(s):
Mohamed Anas
Internal verifier: Nabeela Haleem
Assessor(s) please fill the table below AFTER the evaluation.
Assessment criteria
Maximum Marks
1.1
1.2
2.1
2.2
3.1
3.2
4.1
4.2
Total Marks
Marks Obtained
IV Comments
12
12
16
10
12.5
12.5
12.5
12.5
100
Assessor’s Name
Signature
Date
__/__/__
This is the cover page for your assignment. Each task must have this cover page. A missing cover page will require you
to resubmit the task and a fee of MVR 50 will be charged. Read the document titled “Additional Guidance on
Assignments” for help on the general report format, general presentation format and referencing. Evidences required
to achieve each criterion are given just below each criterion. End of cover page.
Statement of Grades:
Marks
85 & Above
75 to 84
65 to 74
50 to 64
Below 50
Representative Grade
A*
A
B
C
F
Grade Interpretation
Higher Distinction
Distinction
Merit
Pass
Fail
Task 2 Presentation questions
1. Understand adjustments for Financial Statements. (3.1) (12.5 marks)
a. Distinguish between Capital and Revenue expenditure
b. For the Business of Liya Enterprises Pvt Ltd, classify the following between ‘capital’ and
‘revenue’ expenditure.
a. An extension to an office building costing £24,000.
b. The cost of replacement valves on all the labelling machines in a canning factory.
c. Annual service costs for a courier firm’s fleet of vans
d. Replacement of rubber tread on a printing press with a plastic one that has resulted
in the useful economic life of the printing press being extended by three years
e. A new bicycle purchased by a newsagent for use by the newspaper delivery boy
c. A business, which started trading on 1 January 2016, adjusted its doubtful debt provision
at the end of each year on a percentage basis, but each year the percentage rate is
adjusted in accordance with the current ‘economic climate’. The following details are
available for the three years ended 31 December 2016, 2017 and 2018.
Year
2016
2017
2018
Bad debts written off
year to 31 December
1750
2850
5650
Accounts receivables at 31
December
46,000
75,000
91,000
Percentage provision
for doubtful debts
5
7
6
You are required to show;
a. Bad debts account for each of the three years
b. Provision for doubtful debts account for each of the three years
c. Balance sheet extracts as at 31st December 2016, 2017 and 2018
d. Liya Enterprises, extracted the following trial balance from their books at the close of
business on 31 December 2015.
Dr $
Cr$
Purchases and Sales
61,420
127,245
Inventory 1st Jan 2014
7940
Capital
25,200
Bank OD
2,490
cash
140
Discounts
2480
Return in ward
3486
Return out wards
1356
Carriage out wards
3210
Rent
8870
Provision for doubtful
630
debts
Motor van
5600
Office equipment
1900
Debtors and creditors
12418
11400
Drawings
21400
Wages and salaries
39200
Office expenses
Notes:
a.
b.
c.
d.
319
168,383
168,383
Inventory as at 31 Dec 2015 is at $6805.
Wages and salaries accrued at 31 Dec 2015 $3500, office expenses owing $16
Rent paid in advance 31 Dec 2015 $1000
It was policy of company to charge depreciation 10% on cost for office
equipment and 15% of NBV from motor vehicle.
Required;
1. Calculate the figures to be stated in the statement of comprehensive income under
expenses for the year ended 31 December 2015 (show workings separately).
a. Wages and salaries
b. Office expenses
c. Rent
d. Depreciation charges for motor van and office equipment as per above
mentioned policies
2. Explain how the above transaction shall be treated in the balance sheet (show
workings to support your answer).
2. Assess the control accounts and Accounting errors. (3.2) (12.5 marks)
a. Prepare a sales ledger control account from the following information for October 2018,
carrying down the balance at 31 October:
date
1 Oct 2018
Details
Sales ledger balances
Amount
28,409
31 Oct 2018
Sales Journal
Bad debts written off
Cheque received from debtors
Discounts allowed
Cheques dishonored
Return inwards
Set-offs against balances in purchase ledger
26,617
342
24,293
416
120
924
319
b. Explain 4 types of errors which does not affect the trail balance.
3. Analyze the Financial statement of limited liability companies. (4.1) (12.5
marks)
Liya Enterprises Pvt Ltd
Statement of comprehensive income for the year ended 31 December
2016,2017 &2018
Revenue
Cost of sales
Gross profit
2016
200,000
100,000
100,000
2017
160,000
96,000
64,000
2018
200,000
114,000
86,000
Operating expenses
Operating Profit
35,000
65,000
30,000
34,000
34,000
52,000
Finance cost
(5000)
(5,000)
(5,000)
Net profit before tax
Tax (15%)
Net Profit
60,000
9,000
51,000
29,000
4,000
25,000
47,000
7,000
40,000
Liya Enterprises Pvt Ltd
Statement of financial position for the year ended 31 December 2016,2017 &2018
2016
2017
2018
100,000
100,000
200,000
170,000
130,000
300,000
180,000
140,000
320,000
Current Assets
Closing inventories
Trade receivables/ Accounts receivable
Cash and bank
Total Current Assets
15,000
30,000
5,000
50,000
15,000
40,000
3,000
58,000
20,000
50,000
1,000
71,000
Total Assets
250,000
358,000
391,000
Current liabilities
Trade creditors
25,000
25,000
35,000
Working capital
Capital employed
25,000
275,000
33,000
333,000
36,000
356,000
Capital and reserves
Share capital
Preference shares
200,000
10,000
200,000
25,000
200,000
25,000
Non-current Assets
Property Plant and Equipment
Motor vehicle
Total non-current assets
Retained earnings
Long term liabilities
Loan (10%)
Capital employed
20,000
230,000
58,000
283,000
81,000
306,000
45,000
50,000
50,000
275,000
333,000
356,000
Required;
a. Assess the purpose of preparing financial statements
b. Identify and explain the users of financial statements
4. Calculate the accounting ratios to assess the performance and position of a
business (4.2) (12.5 marks).
a. Based on the above financial statement of Liya Enterprises Private Limited, you
are required to calculate the following accounting ratios for the year 2017 and
2018.
1. Profitability ratios
2. Liquidity ratios
3. Efficiency ratios
a. Interpretation of the ratios calculated and assess the performance and position of
a business.