Question 1 (a)

i) Balance sheet of an entity provide information on a company’s asset, liabilities and

owner’s equity for a period of time. It is also shows information on cash flow prospect,
financial activity and resource owned by the company.

ii) Account payable RM7,000 shown in bracket because it indicate cash outflow from the
Bala Enterprise. Here Bala Enterprise buy the inventories for RM7,000 without payment
immediately. Hence it’s considered as a debt that need to be subtracted. The accounting
formula is that Asset = Liability + Equity.

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Question 1 (b)

Hairi Sdn Bhd

Trial Balance as of 30 November 2016

Unadjusted Trial Adjustments Adjusted Trial

Balance Balance
Account Debit Credit Debit Credit Debit Credit
(RM) ( RM) ( RM) (RM) (RM) (RM)
Creditor 2,800 1,150 110 1,760
Equipment 6,200 110 6,310
Car 7,300 7,300
Inventories 8,100 380 8,480
Debtor 4,050 640+90= 3,320
730
Bank 9,100 640+1,300= 380+1,150= 9,510
1,940 1,530
Cash 195 90+200= 485
290
Capital 32,145 1,500 33,645
Total 34,945 34,945 3,870 3,870 35,405 35,405

The capital amount is not provided for the 30 November 2016 transaction. So from the
asset money of RM34,945 the capital money of RM32,145 will be derived. Thus,
RM2800 will be substrate. ( RM34,945-RM32,145 ) as Asset = Liability + Owner Equity.
Now the capital for Hairi Sdn Bhd is only RM32,145 for the unadjusted trial balance. The
adjustment as of December 2016 were highlighted in purple.

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 Balance Sheet as on
31 December 2016

Assets Liabilities and owner equity

Current Asset RM RM Liabilities RM
Cash 485 Creditors 1760
Stock 8480
Bank 9510
Debtors 3320
21795

Non-Current Assets Owner’s Equity

Equipment 6310 Capital 33645
Car 7300
13610
35405 35405

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Question 2 (a)

General Journal

Date Accounts and Description Debit Credit

(RM) (RM)
Sept 1 Accounts receivable 1,390
Sales 1,390
(Sales to Johnny- 520, Thomas – 630, Sean-240)
2 Purchases 1,180
Accounts payable 1,180
(Purchased from Ben- 390,Raymond-510,
Patrick-280)
8 Accounts receivable 1058
Sales 1058
(Sales to Thomas-640, Lance-418)
10 Purchases 962
Accounts payable 962
(Purchased from Raymond-92, James-870)
12 Sales Return 215
Accounts receivable 215
(Sales returned from Sean-25, Thomas-190)
17 Accounts payable 96
Purchases return 96
(Returned goods to Raymond-12, James-84)
20 Accounts payable 390
Bank 390
(Payment to Ben by cheque)
24 Bank 400
Accounts receivable 400
(Received cheque from Johnny)

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 26 Accounts payable 766
Bank 766
(Payment to James by cheque)
28 Cash 80
Accounts receivable 80
(Johnny paid by cash)
30 Bank 418
Accounts receivable 418
(Received cheque from Lance)

Posting to Ledgers
Accounts Receivable Account
Date Description Debit Credit Balance
(RM) (RM) (RM)
Sep 1 Sales 1390 1390
8 Sales 1058 2448
12 Sales return 215 2233
24 Bank 400 1833
28 Cash 80 1753
30 Bank 418 1335

The balance of RM1335 is the amount that the debtors owe us. The amount derived after
substract the return on scales, payment by cash and cheque at the credit column.

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Sales Account
Date Description Debit Credit Balance
(RM) (RM) (RM)
Sept 1 Accounts receivable 1390 1390
8 Accounts receivable 1058 2448
12 Accounts receivable 215 2233

A total sales of RM2233 were gained after deduct sales return by customers.

Purchases Account
Date Description Debit Credit Balance
(RM) (RM) (RM)
Sept 2 Accounts payable 1180 1180
10 Accounts payable 962 2142
17 Accounts payable 96 2046

A balance of RM2046 shows the amount that we have to pay to the creditors for purchase
made.

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Accounts Payable Account
Date Description Debit Credit Balance
(RM) (RM) (RM)
Sept 2 Purchases 1180 1180
10 Purchases 962 2142
17 Purchases return 96 2046
20 Bank 390 1656
26 Bank 766 890

A total of RM890 is the amount that payable to creditors.

Bank Account
Date Description Debit Credit Balance
(RM) (RM) (RM)
Sept 20 Accounts payable 390 390
24 Accounts payable 400 790
26 Accounts payable 766 24
30 Accounts receivable 418 442

A total of RM442 is at the Bank now.

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Cash Account
Date Description Debit Credit Balance
(RM) (RM) (RM)
Sept 28 Accounts receivable 80 80

Only one transaction, a total cash of RM80 occur.

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Question 2 (b)
Equation

1. Capital (Asset – Liabilities)

2. Liabilities (Asset – Capital)
3. Asset (Liabilities + Capital)

Assets Liabilities Capital

12,500 1,800 10,700
28,000 4,900 23,100
16,800 4,300 12,500
19,600 3,150 16,450
25,500 6,300 19,200
51,400 11,650 39,750
4,200 2,100 2,100
3,750 2,000 1,750