Financial Accounting (MGT 101)

Assignment No.1
Muhammad Noman
BC190402571
BSIT – Semester#1

Question:

Particulars Rs. Particulars Rs.

Advertising expenses 65,000 Amount earned on sale of goods 121,000

Carriage/transportation Amount earned by rendering of
160,000 840,000
Paid on sale of good services
Purchases 550,000 Total liabilities 1,030,000
Carriage/transportation
50000 Copy rights 250,000
Paid on purchases
Rent of office building 278,222 Good will 150,000

Taxes paid 20,364 Furniture and fixtures 170,000

Mark up on loan 15,228 Plant and machinery 750,000

Salaries paid to employees 16,369 Land and building 770,000

Bank charges 29,367 Cash in hand 150,000

Other financial charges 17,268 Total assets 2,240,000

Required:

Based on the above information of ABC Business, you are required to calculate the amount of:

1. Intangible Assets
2. Equity
3. Total Income/Revenue
4. Selling Expenses
5. Cost of goods sold
Solution:

1- Intangible Assets.

Copy Rights = Rs. 250,000

Good Will = Rs. 150,000
Total Intangible Assets = 250,000 + 150,000 = Rs 400,000

2- Equity.

Total assets = Rs. 2,240,000

Total liabilities = Rs. 1,030,000
Equity = Assets – Liabilities
Put values of asset and liabilities
Equity = 2,240,000 – 1,030,000
= Rs. 1,210,000

3- Total Income/Revenue.

Amount earned on sale of goods = Rs. 121,000

Amount earned by rendering of services = Rs. 840,000
Total liabilities = Rs. 1,030,000
Total Income = 121000+840000+1030000
= Rs. 1,991,000

4- Selling Expenses.

Advertising expenses = Rs. 65000

Carriage/transportation paid on sale of good = Rs. 160,000
Purchases = Rs. 550,000
Carriage/transportation paid on purchases = Rs. 50000
Total selling expenses = 65000+160000+550000+50000
= Rs. 825,000

5- Cost of goods sold.

Rent of office building = Rs. 278,222

Taxes paid = Rs. 20,364
Salaries paid to employees = Rs. 16,369
 Bank charges = Rs. 29,367
Mark up on loan = Rs. 15,228
Total cost of goods sold = 278222+20364+16369+29367+15228
= Rs. 359,550