Question 1 ‘The unadjusted trial balance of Mafi Musykila Berhad as at December 31, 2016, is presented below: Account receivables 45,000 Allowance for doubtful accounts 1,500 {6% Short term note receivable 10,000 ‘Net sales _| 312,800 _ | Additional informatior QI. Based on previous years' experience, the uncollectible accounts are estimated at 5% of accounts receivable. a, What is the Bad Debt expense to be recorded (in journal)? b, How would you report the Account receivable in the SOFP? 2. Based on previous yeats' experience, the uncollectible accounts are estimated at 1% of nct sales. a, What is the Bad Debt expense to be recorded (in journal)? b, How would you report the account receivable in the SOFP? QB. The note receivable is a 3-month note and was accepted on December 1, 2016, Both prineipal and interest will be received on maturity date, 28 February 2017, Interest on the note receivable is accrued at year-end, 31 December 2016. a, Record the accrued interest on the note receivable in journal. b. Where do you report the note receivable, interest receivable anQuestion 2 ‘The partial unadjusted trial balance of Sophis Sdn. Bhd as at December 31, 2015, is presented below: Account receivables 23,000 | Allowance for doubtful accounts 850. ‘The company confirmed that RM700 of its accounts receivable balance is to be written-off. It is estimated that 5% of outstanding account receivable is uncollectible at year end, , What is the Bad Debt expense to be recorded (in journal)? '. How would you report the Account receivable in the SOFP? Question 3 ‘The partial unadjusted trial balance of Princess Sdn. Bhd as at December 31, 2015, is presented below: Account receivables 7 97,300 Allowance for doubtful accounts 1,300 Sales revenue 920,000 QI. Assume the company uses 0.5% or 0.005 of its sales revenue to estimate its bad debt expense for the year, Calculate the Bad debt expense by using the Allowance for doubtful account, Q2. Assume the company uses 5% of accounts receivable to estimate its bad debt expense, calculate the Bad debt expense by using the Allowance for doubtful account. ‘QB. Assume the company uses aging of accounts receivable to estimate its bad debt expense. It estimates that RMS,300 of account receivable will be uncollectible. Calculate the Bad debt ‘expense by using the Allowance for doubtful account. Q4. If one of the customers who owes the company RM2,000, is declared a bankrupt and cannot pay the amount, record the write-off, QS. If part of the debt written-off in (Q4,) above is recovered, let’s say RM1,500, record the recovery and subsequent collection of cashQUESTION 1 Emerging Berhad, « limited company, closes its accounts on December.31 every year, The company reported the following unadjusted tial balance on December 31, 2016: Debit Credit . RM RM Goodwill 32,000 Property, plant and equipment (at book value) 572,000 Long term investitent 140,000 Inventories, 53,700 ‘Trade receivable 44,800 Cash 126,200 6% Notes payable 25,000 ‘Trade payable 32,800 Revenue 827,800 Cost of sales 500,900 Adinistrative expenses 124,100 Distribution expenses 36,900 Income tax. 9,600 Prepaid insurance 3,000 Dividend income (fiom investment) 21,000 Ordinary share capital 400,000 Retained earings 322,400 Revaluation reserve 46,000 Dividend 31,800 1,675,000 1,675,000, ‘The followings ave yet fo be adjusted as at year end: 1. ‘The notes payable was issued on September 1, 2016, and will mature on April 30, 2018, No interest has been paid to date, * 2, The inventory has a net realisable value of RM50,000, 3, The prepaid insurance was paid on July 8, 2016, for 12 months beginning July 2016. Insurance is part of administrative expense, 4, Tnoluded in the property, plant andl equipment is a piece of frechold land that was bought jn 2014 at « cost of RM350,000. The company decided to revalue the freehold tand line with the recent increases in market value, In December 2016, an independent surveyor valued the freehold land at RM420,000, 5. It is the company’s policy to depreciate its remaining property, plant and equipment at 10% per annum, Depreciation expense is classified as administrative expense. 6. Goodwill was tested for impairment, On December 31, 2016, the value of goodwill is RM26,000.Sireal Products Berhad is a manufacturer and retailer of dairy products. The following balances have been ‘extracted from the ledger accounts of the company at 31 December 2015. Debit Credit PEELE PEPE Eee RM ‘000 RM 000 Sales 4,837,000 Cost of sales 2,972,000 Selling and distribution expenses 928,000 Administrative expenses 179,400 Finance income 1,130 Finance costs 34,370 Other income 1,400 Income tax expense 136,900 Other comprehensive income: Revaluation reserve 57,825 Share capital 234,500 Revaluation reserve 138,290 Retained earnings 474,100 Dividend 715,225 Property, plant and equipment, net 1,369,800 Tntangil 62,800 Long-term investments 29,110 Inventories 414,260 Prepayment 12,000 ‘Trade and other receivables 569,900 ‘Cash and cash equivalent 19,100 Unearned sales revenue 77,540 Bank loans 96,450 ‘Trade and other payables Poe _1,524,630. 7.442.865 _7,442,865 ‘The following additional information is available at 31 December 2015. e Accrued salaries, an administrative expense amounted to RM 6,900. Unrecorded sales revenue at year-end amounted to RM 14,450. Goods were sold to customers but joives were yet to be issued. Unearmed sales revenue that has been eamed for the year 2015 amounted to RM 15,080. Six months’ rent amounting to RM 12,000 were paid in advance on 1 October 2015, On that date, the Prepayment account was debited and Cash account credited, Adjustment for 2015 rent expense (an administrative expense) has not been recorded. The bank loan was taken at the beginning of 2014 and finance costs is payable at 4% per year, Finance cost was paid for the year-ended 31 December 2014 but the finance cost for 2015 remained unpaid and unrecorded at 31 December 2015. Depreciation on property, plant and equipment has yet to be charged. Sireal Berhad charges depreciation at a tate of 10% per year