Assignment # 01
Total marks: 15
Learning objectives:
After solving this assignment, students will be able to:
XYZ took a complete physical count of shop supplies at March 31, 2011. The supplies on hand amount to be Rs. 18,952. Management argued that this was greater than the requirements of the company and it also increases the hoarding cost of the company so, it was decided to reduce this level in the next year. In the year 2012, the company purchased supplies of Rs. 62,500 and debited to the Supplies account. In March 31, 2012, the company significantly reduces its inventory levels and as a result the ending inventory was Rs. 6,800.
During the fiscal year, XYZ signed a contract with Hospitality Inn Hotel to provide them customized products for their Hotel. The manufacturing was started in the year 2005. XYZ recorded the proceeds from the Hospitality Inn Hotel as Unearned Revenue account. The contact has a flat fee of Rs. 189, and 678 products were sold to the Hotel. At March 31, 2012, 25% work of the contract was completed.
XYZ use billboards for the advertisement of their products. ABC advertising company sold a plan for multiple locations in the city. XYZ agreed to prepay the full amount of advertisement. The amount of advertisement was Rs. 13,000. Due to full payment ABC promised to allow the company to use the billboards for 13 months. XYZ Company paid the amount on June1, 2011, and recorded the amount as prepaid in its Balance Sheet. Due to some reasons the advertisement campaign was not started until July 1, 2011. The campaign will accomplish on July 31, 2012.XYZ Company has taken shops on lease. Rent is paid on monthly basis and is payable on the first of each month. XYZ paid rent for the month of March on 1st March, and it will pay rent of
Aril on 1st April.
You are required to prepare adjusting entries for XYZ Company, as of March 31, 2012.
DEADLINE:
FORMATTING GUIDELINES:
RULES FOR MARKING
Please note that your assignment will not be graded or graded as Zero (0), if:
Total marks: 15
Learning objectives:
After solving this assignment, students will be able to:
- Understand the nature of adjusting entries
- Prepare the adjusting entries
Learning Outcome:
After going through this assignment, the learner would be able to
· Prepare adjusting entries after incorporating the necessary adjustments
After going through this assignment, the learner would be able to
· Prepare adjusting entries after incorporating the necessary adjustments
Assignment Question:
XYZ is a fashion boutique. It targets teenagers and youngsters. The following information is related to the adjusting entries of the company as on March 31, 2012. The company records all adjusting entries at the end of the each year. The fiscal year of the company ends on 31st March,2012.
The company has its own textile unit for the manufacturing of the cloth. The depreciation expense for the plant and machinery was recorded as Rs. 61,700 for year 2012.
The company has taken loan from Babib Bank Limited. The amount of accrued interest is Rs. 10,839 for the fiscal year 2012.
XYZ outsource some embroidery material and work. The outsourcing is done on credit, and billed monthly. The mount of unbilled services was Rs. 27,400 for the year 2012.
The company has taken a general business liability insurance policy from AdamJee Insurance Limited. The annual prepaid premium is Rs. 12,000. XYZ purchased this policy on October 1, 2011. The company also maintains a 6 month property & casualty policy, which was taken on December 1, 2011 for a total cost of Rs. 6,000. Both the policies were recorded as prepaid insurance.
XYZ is a fashion boutique. It targets teenagers and youngsters. The following information is related to the adjusting entries of the company as on March 31, 2012. The company records all adjusting entries at the end of the each year. The fiscal year of the company ends on 31st March,2012.
The company has its own textile unit for the manufacturing of the cloth. The depreciation expense for the plant and machinery was recorded as Rs. 61,700 for year 2012.
The company has taken loan from Babib Bank Limited. The amount of accrued interest is Rs. 10,839 for the fiscal year 2012.
XYZ outsource some embroidery material and work. The outsourcing is done on credit, and billed monthly. The mount of unbilled services was Rs. 27,400 for the year 2012.
The company has taken a general business liability insurance policy from AdamJee Insurance Limited. The annual prepaid premium is Rs. 12,000. XYZ purchased this policy on October 1, 2011. The company also maintains a 6 month property & casualty policy, which was taken on December 1, 2011 for a total cost of Rs. 6,000. Both the policies were recorded as prepaid insurance.
XYZ took a complete physical count of shop supplies at March 31, 2011. The supplies on hand amount to be Rs. 18,952. Management argued that this was greater than the requirements of the company and it also increases the hoarding cost of the company so, it was decided to reduce this level in the next year. In the year 2012, the company purchased supplies of Rs. 62,500 and debited to the Supplies account. In March 31, 2012, the company significantly reduces its inventory levels and as a result the ending inventory was Rs. 6,800.
During the fiscal year, XYZ signed a contract with Hospitality Inn Hotel to provide them customized products for their Hotel. The manufacturing was started in the year 2005. XYZ recorded the proceeds from the Hospitality Inn Hotel as Unearned Revenue account. The contact has a flat fee of Rs. 189, and 678 products were sold to the Hotel. At March 31, 2012, 25% work of the contract was completed.
XYZ use billboards for the advertisement of their products. ABC advertising company sold a plan for multiple locations in the city. XYZ agreed to prepay the full amount of advertisement. The amount of advertisement was Rs. 13,000. Due to full payment ABC promised to allow the company to use the billboards for 13 months. XYZ Company paid the amount on June1, 2011, and recorded the amount as prepaid in its Balance Sheet. Due to some reasons the advertisement campaign was not started until July 1, 2011. The campaign will accomplish on July 31, 2012.XYZ Company has taken shops on lease. Rent is paid on monthly basis and is payable on the first of each month. XYZ paid rent for the month of March on 1st March, and it will pay rent of
Aril on 1st April.
You are required to prepare adjusting entries for XYZ Company, as of March 31, 2012.
DEADLINE:
- Make sure to upload the solution file before the due date on VULMS.
- Any submission made via email after the due date will not be accepted.
FORMATTING GUIDELINES:
- Use the font style “Times New Roman” or “Arial” and font size “12”.
- It is advised to compose your document in MS-Word format.
- You may also compose your assignment in Open Office format.
- Use black and blue font colors only.
RULES FOR MARKING
Please note that your assignment will not be graded or graded as Zero (0), if:
- It is submitted after the due date.
- The file you uploaded does not open or is corrupt.
- It is in any format other than MS-Word or Open Office; e.g. Excel, PowerPoint, PDF etc.
- It is cheated or copied from other students, internet, books, journals etc.
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