Part 1

Objective

This assignment aims to enhance students’ proficiency in key accounting practices, including preparing trial balances, analyzing partnership profits and partner accounts, computing financial ratios for comparative performance analysis, and assessing asset disposal and depreciation impacts on financial statements. It’s designed to develop practical skills in financial accounting and analysis for real-world application.

Requirements

Question 1
Required:  Assuming all accounts are in normal balance, prepare the trial balance as at 31 December 2022.

Question 2
Required:  
Calculate:  
a.  the correct gross profit and net profit to be reported in the partnership profit and loss account for the year ended 30 April 2022.            
                         
b.  the amount of profit which will be credited to each partner’s current account for the year to 30 April 2022.              

 c.  the balance on each partner’s current account at 30 April 2022.

Question 3  
Required:
 a.  Calculate the following ratios for Fatty and Skinny:      (State the formulas used for calculating the ratios).                                      
 i.  Gross profit percentage.
ii.  Asset turnover ratio.
iii.  Current ratio.
iv.  Receivables collection period.

b.  Compare and comment on the performance of the companies as indicated by the   ratios you have calculated in part (a).    

Question 4
Required:  
Calculate:  
a. the profit or loss on disposal of each of the vehicles.          
                       
b. the depreciation charge for the year to 31 May 2022 for motor vehicles.  

 c. the total amount to be reported in the profit and loss account for the year to 31 May 2022 in respect of motor vehicles.

Part II

Online Class 

Discuss the following topic(s) in the forum and submit proof of your participation in the online discussions: