Saudi Electronic University Accounting Questions
Description
Assignment Question(s): (10.0 Marks)
1.On October 1, 2021, a manufacturing company in Egypt imported raw materials of 100,000 $ from the United States by letter of credit and it will pay for the raw materials after 6 months against promissory note. (4.0 marks)
Exchange rates of Egyptian pound against us $ were as follows:
October 1, 2021 15.70
December 31, 2021 15, 60
March 31, 2022 18.5
Required:
a. Pass journal entries to record purchasing raw materials.
b. Pass journal entries to record the impact of change in exchange rates at the end of the year.
c. journal entries to record payment of liabilities on March 31, 2022.
2. On January 1, 2021 a parent company based in US acquired a subsidiary in Egypt and the following information is extracted from the subsidiary books for 2021 🙁 3.0 marks)
Inventory purchased on Oct. 1 2021.
Purchases of inventory have been made throughout the year.
Uses straight-line depreciation on fixed assets.
Dividends declared and paid on December 1, 2021
Fixed assets have been purchased on Feb. 1 2021.
Adjusted trail balance as of 31/12/2021 as follows:
|
Account title |
Amount in Egyptian pound |
|
Cash |
2,000,000 |
|
Accounts receivable |
2,000,000 |
|
Inventory |
5,000,000 |
|
Notes receivable |
1,000,000 |
|
Plant assets |
10,000,000 |
|
dividends |
200,000 |
|
Cost of goods sold |
7,000,000 |
|
Depreciation expense |
200,000 |
|
Other expenses |
500,000 |
|
Total debits |
25,900,000 |
|
Sales |
10,000,000 |
|
Accumulated depreciation |
200,000 |
|
Accounts payable |
3,000,000 |
|
Notes payable |
1,000,000 |
|
Common stocks |
9,600,000 |
|
Retained earnings |
2,100,000 |
|
Total credits |
25,900,000 |
Exchange rates:
|
Date |
Exchange rates |
|
January 1, 2021 |
15.50 |
|
Oct. 1 2021 |
15,60 |
|
December 1, 2021 |
16,50 |
|
Feb. 1 2021 |
17.00 |
|
December 31, 2021 |
17,20 |
|
Average |
16.36 |
Required:
Prepare a schedule to translate Subsidiarys financial statements on 31/12/2021 to U.S. dollars using current rate method.
3. The partnership of Ibrahim and Rawan have the following provisions: (3.0 marks)
– Ibrahim and Rawan receive yearly salary allowances of SAR 30,000 and SAR 20,000, respectively.
-Interest is rate of 6 % on the average capital investment.
-Any remaining profit or loss is shared between Ibrahim and Rawan at a ratio of 2:1 ratio, respectively.
-Average Capital investments: Ibrahim SAR 100,000; Rawan, 50,000
Required:
a.Prepare a schedule showing the distribution of the profit between the two partners assuming the partnership profit SAR 200,000.
b.Pass journal entries to allocate the profit to the partners.
Get your college paper done by experts
Do my questionPlace an order in 3 easy steps. Takes less than 5 mins.
Leave a Reply
Want to join the discussion?Feel free to contribute!