An-Najah N. University Faculty of Eng. & IT ( MIS Dept.

)
Final Assignment Principle of Accounting and Finance
17/5/2020 9 – 11 am
Q1. For each item, indicate the impact of that transaction on assets, liabilities, and equity. Assume that all
transactions, unless stated otherwise, are in cash. The first point is an example.
Assets Liabilities Equity
Transaction (increase + or (increase + or (increase + or
  decrease -) = decrease -) + decrease -)
Received $50,000 cash and issued
1.
share to the owners  +50000        +50000
2. Paid $40,000 cash for land
         
Bought $3,700 of supplies on
3.
account          
Received $7,000 cash from
4. customers for service revenue
earned          
Performed services for customers on
5.
account, $3,000          
Paid cash expenses: rent, $1,100;
6. employee salary, $1,200; utilities,
$400          
Paid $1,900 on the account payable
7.
created in transaction 3
Major shareholder paid personal
8. funds to remodel home, not a
business transaction

9. Received $1,000 on account

Sold land for cash at the land’s cost

10.
of $22,000

Declared and paid a dividend of

11.
$2,100 to the stockholders
Q2.

Q3. Journalize the following transaction then Post to the Cash ledger only.

Q4. Prepare the trial balance as explained in textbook. Then the Income Statement, the Statement of
owner’s equity, and the Balance sheet; for AL-QUDS Co. The assets and liabilities of AL-QUDS as of
December 31, 2016, and revenues and expenses for the year ended on that date follow.
                 
   Land................................ $ 8,000   Equipment....................... $ 36,300

  Note payable................... 32,500   Interest expense............... 4,850

  Property tax expense ...... 1,500   Interest payable ............... 1,000

  Rent expense................... 13,200   Accounts payable ............ 13,500

  Accounts receivable........ 27,000   Salary expense................ 37,000

  Service revenue............... 143,000   Building.......................... 129,200

  Supplies.......................... 1,700   Cash................................ 15,000

  Utilities expense............. 3,000   Share capital................ 16,250

                 

Beginning retained earnings were $116,500, and dividends totaled $46,100 for the year.

Q5. The trial balance of Harper, Inc., at September 30, 2016, does not balance:

Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   $4,200    

Accounts receivable . . . . . . . . . . . . . . . .   13,200    

Inventory . . . . . . . . . . . . . . . . . . . . . . . . . 16,700    

Supplies . . . . . . . . . . . . . . . . . . . . . . . . . .   100    

Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52,100    

Accounts payable . . . . . . . . . . . . . . . . . .      $ 11,800

Share capital. . . . . . . . . . . . . . . . . . . . . . .    45,000

Service revenue . . . . . . . . . . . . . . . . . . . .      32,500

Salary expense . . . . . . . . . . . . . . . . . . . . .   1,200    

Rent expense . . . . . . . . . . . . . . . . . . . . . . 1,400    

Utilities expense . . . . . . . . . . . . . . . . . . . . 500    

Total   $ 89,400   $ 89,300

The accounting records hold the following errors:        

a. Recorded a $500 cash revenue transaction by debiting Accounts Receivable. The credit
  entry was correct.        
b
. Posted a $2,000 credit to Accounts Payable as $200.        
c. Did not record utilities expense or the related account payable in the amount of $1,000.
d
. Understated Share Capital by $1,400.        
e
. Omitted Insurance Expense of $4,000 from the trial balance.      

Good Luck