Financial Accounting & Analysis
1. For the following transactions, analyze the accounting transactions using the accounting equation framework:
- Introduced Rs500000 through a cheque by the Owner as the Initial capital in the business
- Purchased goods on credit from Ms. Ritu at Rs 40000
- Paid Rs 10000 as salary to the employees
- Invested Rs200000 in a fixed deposit account
- Paid school fees of the kid Rs 25000, from the business’s bank account.
Note: (2*5 = 10 marks) 1 marks for analyzing each transaction and 1 mark for correct journal entry
2. You started learning the course of financial accounting and analysis in the MBA Program. You learned about commonly used accounting terms. Discuss about any five terms which are commonly used by the different users of accounting information for the sake of understanding the financial statements.
Student may define and describe about any five terms.
3. From the given information:
|Amount in Lakhs|
|Cost of goods sold||580|
|Creditors at the beginning of the year||60|
|Creditors at the end of the year||100|
|Original cost of equipment sold||400|
|Gain on the equipment sold||50|
|Accumulated depreciation on the equipment||80|
a. Total purchases, credit purchases and payment to creditors.
b. Define the term Net book value; Accumulated depreciation calculate the net book value and cash proceeds from sale of investment.