MPA701 Assessment Task 3

Question:

Background:

MPA701: Accounting Deakin Business School First Name: —– Last Name: —- Student ID: 21****45

Trimester: T2 2020

Company Name: —- Pty Ltd

The company began operations as a retailer on 1 July 2017. It buys and sells one inventory item, derrings, from a leased warehouse in the outer suburbs of Melbourne.

The company is registered for GST which it pays quarterly. Assume GST was last paid on 30 June. It uses the Weighted Average cost allocation method and the perpetual inventory recording method.

The company uses the straight line depreciation method for office furniture and computers and the reducing balance method for motor vehicles.

The company employs two people who are rostered over a seven day working week. The employees are paid fortnightly up to and including the day of payment. There are no penalty wages.

The company has one debtor (Debtor1) and one creditor (Creditor1). Terms for all credit sales and purchases are 30 days

Relevant information

1. The company has the following opening balances at the 1 July in the current financial year:

Cash at Bank: $23,520.00

Accounts receivable: $4,735.00 Allowance for doubtful debt: $471.00 Inventory: $10,060.00

Motor vehicle: $20,980.00

Accumulated depreciation motor vehicle: $2,127.00

Accounts payable: $5,281.00

Bank loan owing (due in 20 months): $12,936.00

Office furniture: $10,505.00

Accumulated depreciation office furniture: $1,361.00

Office supplies: $648.00

Share capital: $41,241.00

Retained earnings: balance amount $7,031.00

2. Transactions for the month (all dollar amounts include GST where applicable).

02 July Sales on credit 67 units 05 July Sales on credit 60 units

11 July Sales on credit 61 units 18 July Sales on credit 62 units 22 July Sales on credit 52 units 29 July Sales on credit 51 units

08 July Paid Wages (ignore PAYG tax) $2,455.00 22 July Paid Wages (ignore PAYG tax) $2,024.00 13 July Paid rent for the current month $2,318.00 25 July Paid insurance $1,629.00

02 July Received advertising invoice (due in 30 days) $544.00

29 July Purchased computer on credit $2,216.00

07 July Purchased inventory on credit 24 units at the cost per unit of $28.00 14 July Purchased inventory on credit 28 units at the cost per unit of $25.00 20 July Purchased inventory on credit 30 units at the cost per unit of $27.00 24 July Purchased inventory on credit 28 units at the cost per unit of $25.00 30 July Purchased inventory on credit 28 units at the cost per unit of $25.00 26 July Received payment from accounts receivable $1,016.00

28 July Received payment from accounts receivable $864.00 18 July Received payment from accounts receivable $922.00 03 July Purchased office supplies on credit $699.00

15 July Paid motor vehicle expenses $107.00

10 July Paid accounts payable $1,447.00 24 July Paid accounts payable $1,050.00 08 July Paid accounts payable $809.00

3. Additional information:

Selling Price per unit (GST inclusive) $55.00

Insurance paid from the first of the current month and for: 10 months in total. Insurance commences from the first of the month in which it is paid.

All asset purchases and expenses except wages include GST Cost of opening inventory items per unit $20.00 Depreciation rate motor vehicle 20%

Residual value motor vehicle: $2,285.00 Depreciation rate office furniture 20% Residual value office furniture: $595.00

Regardless of purchase date, company policy is to depreciate new assets for 15 days in the month of purchase. Depreciation rate computer 35%

No residual value is expected for computers.

The company counted inventory at the end of the month. They discovered that 8 units were missing and these must be removed from inventory.

Office supplies on hand at end of the month were $202.00

At the end of the month the company records potential bad debts expense using the percentage of sales method. The business uses 1% of sales to determine estimated bad debts.

Interest owing on the bank loan at the end of the month is $60.00

REQUIRED:

SORT THE TRANSACTIONS IN DATE ORDER. This is critically important for any inventory transactions (sales and purchases) as the value of inventory is calculated using the moving weighted average method.

• Using the PROFORMA available on CloudDeakin, manually prepare general journal entries to enter all relevant July transactions (including the opening entry and all adjusting entries). Narrations are required. The PROFORMA document is located in the ‘Assessment Task 3’ folder. Note: closing entries are not
• Using the format in the PROFORMA document, prepare a stockcard for the month (this is required to help you track inventory movements and calculate COS) using the moving weighted average cost
• Post all journals to the
• Prepare an adjusted trial

Submission Instructions

1. This assignment is to be submitted ONLINE ONLY (You are NOT required to submit a hard copy).
2. You must type your answer onto the PROFORMA document provided for the manual
3. The completed PROFORMA for the manual set must be submitted to the Assignment DropBox on CloudDeakin under the Assessment
4. You are not required to upload an Assignment Cover Sheet. You will complete a Plagiarism declaration when you access the
5. You are allowed to make resubmissions within the submission period. Please note that your last submission overwrites previous submissions, however, this must be submitted before the DUE DATE.

You must keep a backup copy of every assignment you submit until the marked assignment has been returned to you. In the unlikely event that one of your assignments is misplaced, you will need to submit your backup copy.

Any work you submit may be checked by electronic or other means for the purposes of detecting collusion and/or plagiarism.

When you are required to submit an assignment through your CloudDeakin unit site, you will receive an email to your Deakin email address confirming that it has been submitted. You should check that you can see your assignment in the Submissions view of the Assignment dropbox folder after upload, and check for, and keep, the email receipt for the submission.

Submitting Assessment Task 3

YOU WILL BE SUBMITTING 4 FILES FOR ASSESSMENT TASK 3 –

1. Proforma general journal entries
2. Stockcard
3. General Ledger
4. Adjusted Trial Balance

The assessment task must be submitted before 08:00 PM AEST Friday 18 September 2020. Only the online submissions via CloudDeakin within the submission period will be marked.