Principles of Accounting ACCT101 | Quick Solution

Assignment Question(s): (10 Marks)
Q1-
A. What is a bank reconciliation and why is it important for companies to do it periodically?
B. Prepare a Bank Reconciliation Statement for XYZ company that has:
Bank statement of SR9,000.
Cash account of SR7,500.
Additional information for the reconciliation:
 Deposit in transit.
 NSF Check.
 Outstanding check.
 Collections made by the bank.
Required: provide an amount of each information to bring the adjusted balances to be equal (3 Marks).
Q2-
Assume that you have a company. And the management estimates that 2.5% of sales will be uncollectible.
Provide an amount of sales and prepare the journal entry using the percent of sales method (2 Marks).
Q3-
A company that uses a perpetual inventory system made the following cash purchases and sales. There was no beginning inventory (3 Marks).
January 1: Purchased 100 units at SAR10 per unit
February 5: Purchased 60 units at SAR 12 per unit
March 16: Sold 40 Units for SAR 16 per unit
Prepare general journal entries to record the March 16 sale using the
o FIFO inventory valuation method.
o LIFO inventory valuation method.
Q4. A company wants to implement good internal control. What are the policies and procedures you can suggest to minimize human frauds and errors? (2Marks)