CONFIDENTIAL AC/TEST1/ACC407/406
UNIVERSITI TEKNOLOGI MARA
TEST 1
COURSE : FUNDAMENTAL FINANCIAL ACCOUNTING AND
REPORTING/ INTERMEDIATE FINANCIAL ACCOUNTING
AND REPORTING
COURSE CODE : ACC407/406
SEMESTER : MARCH – AUGUST 2023
TIME : 1 HOUR AND 30 MINUTES
INSTRUCTIONS TO CANDIDATES
QUESTION MARKS
PART A
PART B:
Q1
Q2
TOTAL
1. This question paper consists of two (2) parts.
i) PART A : Multiple Choice Questions (10 marks)
ii) PART B : Short Structured Questions.
Question 1 (10 marks)
Question 2 (30 marks)
2. Answer ALL questions in English.
3. Do not bring any material into the examination room unless permission is given by the
invigilator.
Fill in the details below:
Name : __________________________________________
Student ID No : ___________________________________________
Programme Code: ________________________________________
Group : ___________________________________________
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CONFIDENTIAL AC/TEST1/ACC407/406
DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO
This examination paper consists of 11 printed page
© Hak Cipta Universiti Teknologi MARA
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CONFIDENTIAL AC/TEST1/ACC407/406
QUESTION
PART A: MULTIPLE CHOICE QUESTIONS (10 MARKS)
1. The following are the internal users of an organization, except:
A. Owners and managers.
B. Securities Commission and potential customers.
C. Storekeeper and employee.
D. Internal auditor and accountant.
2. ____________ is the last step in the accounting cycle.
A. Preparation of financial statements.
B. Postings the transactions from journal to ledgers.
C. Recording the accounting adjustments.
D. Analysis of financial statements
3. An asset is recorded at its original price. This is to fulfil which qualitative
characteristic of financial information or accounting concept?
A. Completeness
B. Economic entity concept
C. Historical cost concept
D. confirmatory value
4. Which of the following is not true concerning a conceptual framework in
accounting concept?
A. It allows preparers to solve practical problem more quickly by reference to it.
B. To assist MASB in developing MFRS Standards
C. It should be a basis on fundamental truths that are derived from the
laws of nature.
D. None of the above.
5. The fundamental qualitative characteristic of conceptual framework is
_____________
A. economic entity
B. Going concern
C. Truthful representation
D. Free from error
6. The depreciation method was used for the last accounting year, and it should be
used for the current and future accounting period as to comply with __________
A. Consistency concept
B. Going concern concept
C. Money measurement concept
D. Completeness concept
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CONFIDENTIAL AC/TEST1/ACC407/406
7. Which of the following accounting equation is not true?
A. Assets - Liabilities + Revenues = Capital - Expenses
B. Assets + Expenses = Capital + Liabilities + Revenues
C. Assets + Expenses – Revenues = Liabilities + Capital
D. Assets - Liabilities = Capital + Revenues - Expenses
8. Which of the following is INCORRECT classification?
A. Office equipment – non-current asset
B. Inventory – current asset
C. Bank overdraft – current liability
D. Account receivable – current liability
9. Which of the following statement described the principles of double entry is true?
A. Cash purchases will be debited in the purchases account.
B. Cash contributed by the owner of the business will be debited in the capital
account.
C. Withdrawal of cash by the owner of the business for his/her personal usage
will be debited in the capital account.
D. Sold of goods to existing customers on credit will be debited in the sales
account.
10. In a double entry system, a credit is used to record __________.
A. increase in revenues and drawings
B. increase in expenses and assets
C. increase in owner’s equity and assets
D. increase in liabilities and owner equity
(10 marks)
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PART B
Encik Hakim, started his business on 1 January 2023. His business, Kampung
Pisang Trading was set up with the objective to offer exclusive traditional attires
at an affordable price. He contributed RM80,000 to start up the business.
Beside that the business also obtained RM200,000 20-years loan from KKK
bank. He also brought a used motor van valued at RM40,000 for the business
purposes. On 3 January 2023, Encik Hakim bought and recorded furniture
and office equipment at a cost of RM7,000 and RM6,000 respectively. The
business adopts reducing balance method and plan to used the same method
for future accounting year. Encik Hakim assumes that his business will
continue to operate and grow in the foreseeable future.
Encik Hakim took RM500 to buy his daughter a birthday’s present and he did
not record this transaction in the business books of accounts. The accounting
year end of Kampung Pisang Trading is on 31 December each year.
Required:
a. Briefly explain the following business characteristics possessed by
Kampung Pisang Trading .
i. Capital contribution and ownership - Owned by one person/Capital
contributed by the owner
ii. Liabilities -Unlimited liabiabilities
iii. Profit and loss - Profit or losses borne by the owner
(6 marks)
a. Briefly discuss the following qualitative characteristic that determine the
quality of financial information.
i. Comparability -Comparable information enables comparisons
within the entity and across entities.
ii. Faithful representation- faithfully represent the substance of
the phenomena that it purports to represent.
(4 marks)
(Total: 10 marks)
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PART C
Ramadhani is the owner of Adha Enterprise located in Shah Alam, Selangor. Adha
Enterprise, a grocery shop started its operation in January 2023. The following
transactions are selected from the business for the month of January 2023.
Date
January Transactions
2023
The owner contributed RM90,000 cash and office equipment valued at RM40,000
1 to start the business.
2 Deposit RM70,000 cash into the business bank account.
3 Purchased fax machine from Mala Trading costing RM4,700. The payment will be
paid in two equal installments starting next month.
4 Received a bank loan worth RM75,000 from LLH Bank.
5 Purchased goods on credit worth RM7,500 from Senang Enterprise.
8 Cash sales to Safuan amounting to RM4,500.
9 Purchased goods worth RM8,000 from Adam Runcit and paid via online transfer.
A credit note of RM550 was received from Senang Enterprise for damaged goods
11 returned.
17 Sold goods amounting RM5,500 to Kamisah on credit.
20 Paid Senang Enterprise for full settlement by cheque.
25 Invested RM20,000 in fixed deposits by cheque.
A cheque for RM5,200 was received from Kamisah on which RM200 cash discount
26 was given to her.
27 Paid wages and salaries RM25,000 to all the workers through online banking.
28 The owner took RM5,000 cash to settle her personal debts.
Required:
a. Identify the effects (increase or decrease) of assets, liabilities, owner's equity,
revenues or expenses for the transactions dated of all the above transactions.
(15 marks)
b. Show the journal entry (debit and credit) of all the above transactions.
(15 marks)
(Use the format given below to answer the above questions)
Example: January 28 - Paid RM200 for utilities expenses by cash.
Date (a) Effects (b) Journal Entry
Exam Increase Decrease Debit Credit
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ple Expenses Asset Utility Expenses Cash
Jan
28
Effects Journal Entry
Date Increase Decrease Debit Credit
Asset Cash a/c Capital a/c
Asset Office Equipment a/c
1 Owner Equity
Asset Asset Bank a/c Cash a/c
2
Assets Fax Machine a/c A/P – Mala trading
3 Liabilities a/c
Assets Bank a/c Loan a/c
4 Liabilities
Expenses Purchase a/c Account Payable–
5 Liability Senang Enterpries a/c
Revenues Cash Sales a/c
8 Asset
Expenses Asset Purchase a/c Bank
9
Liability Account Payable a/c – Return outward a/c
11 Expenses Senang
Asset A/R- Kamisah a/c Sales a/c
17 Revenue
Asset Account Payable a/c – Bank a/c
20 Liability Senang
25 Asset Asset Fixed deposit a/c Bank a/c
Asset Asset Bank a/c A/R- Kamisah a/c
26 Revenue Discount Allowed
a/c
Asset Wages and salaries Bank
Expenses a/c
27
Equity Drawings a/c Cash a/c
28 Assets
END OF QUESTION PAPER
