Tutorial 9 Year End Adjustments

1

LTJ 2020

Tutorial 9 – Year End Adjustments

Section A:

1. Explain the following items, giving an example in each case. How are they

treated in the accounts?

• Accrued income

• Income in advance

• Accrued expense

• Prepaid expense

Question 2

The following is an extract of the Statement of Financial Position of Gaya

Sdn Bhd:

Statement of Financial Position (extract) as at 31 May 2017

RM

Current assets

Prepaid advertising expenses

1,280

Required:

Prepare and balance off the following accounts for the year ended 31 May

2018:

(a) Prepaid advertising expenses account

(b) Advertising expenses account

(c) Accrued advertising account

(d) Accrued rental received account

(e) Rental received account

(f) Accrued electricity account

(g) Electricity account

(h) Prepaid electricity account

Question 3:

The Trial Balance for Ravi as at 31 March is as follows:

DR

CR

RM

Inventory 1 April (b/d)

8,200

Purchases and Sales

26,000

40,900

Rent

4,400

Accrued rental received

2,000

Current liability

Unpaid electricity expenses

Receipts RM

Payments RM

Rent received 10,000

Advertising 600

Electricity 1,000

Insurance

1,600

Salary

9,990

Motor vehicle at cost

9,000

Commission received

Rental received

Trade receivables and payables

Accumulated depreciation:motor vehicle

Capital at 1 April (b/d)

19,700

Drawings

11,700

73,550