Project One: Payroll

TEC IT Company
Payroll Register
April 30, 2013

S. Name Earnings Gross Deductions Total Net Pay Sign

N Basic Allo OT Earning Income Pension Deductio
Salary Tax Contr. Abay
1 Tiru 10,000 2,000 - 12,000 3,257.50 700 1,000 4,957.50 7,042.50
2 Nega 680 170 850 80.00 - - 80.00 770.00
3 Geleta 4,500 500 351.56 5,351.56 1,042.97 315.00 450 1,812.97 3,538.59
4 Yemar 2,600 200 365.63 3,165.63 506.41 182.00 260 948.41 2,217.22
5 Kuli 1,100 100 171.88 1,371.88 143.28 77.00 110 330.28 1,041.60
Total 18,880 2,800 1,059.07 22,739.07 5,030.16 1,274.00 1,820 8,129.16 14,609.91

Journal Entries
1. To record the payments of salary expense for the month:
Salary Expense ……………22,739.07
Income Tax Payable…………………..5,030.16
Pension Contribution Payable……….1,274.00
Abay Dam Payable…………………. 1,820
Cash………………………………….14,609.91

2. To record the Payroll Tax (Employer’s Pension) Expense:

Payroll Tax Expense………….2,002
Pension Contribution Payable…………..2,002
(18,200 x 11% = 2,002)

3. To record the Abay Dam Payment

Abay Dam Payable……………… 1,820
Cash ………………………………….. 1,820

4. To record the payment of payroll tax and withholding tax to the Inland Revenue
Authority:
Income Tax Payable…………….………5,030.16
Pension Contribution Payable…….……3,276.00
Cash…………………………………………. 8,306.16

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Project Two: Accounting Cycle
Adjusting Entries

a. Fees Receivable…………….7,750
Fees Revenue…………………..7,750
b. Supplies Expense……………485
Supplies………………………….…485
c. Insurance Expense…………2,100
Prepaid Insurance………………....2,100
d. Advertising Expense……….750
Prepaid Advertising………….……750
e. Salary Expense…………….1,140
Salary Payable……………..…1,140
f. Unearned Rent…………..700
Rent Income…………….……..700

Yedil Kebir Company

Adjusted Trial Balance
June 30, 2012
Account Title Dr Cr
Cash…………………………………….. 9410
Fees Receivable…………………………56,060
Supplies………………………………….190
Prepaid Insurance………………………..1,625
Prepaid Advertising………………………250
Salary Payable…………………………………………………………….1,140
Unearned Rent……………………………………………………………...300
Capital…………………………………………………………………… 42,810
Rent Income……………………………………………………………….9,800
Fees Revenue……………………………………………………………… 70,000
Salary Expense………………………….42,840
Advertising Expense……………………..11,090
Insurance Expense………………………..2,100
Supplies Expense………………………….485
124,050.00 124,050.00

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 Yedil Kebir Company
Profit and Loss Statement
For the month ended June 30, 2012
Revenues
Fees Revenue…………………………………………..70,000
Rent Income………………………………………….9,800
Total Revenues…………………………………………………………….79,800
Expenses
Salary Expense……………………………………...42,840
Advertising Expense………………………………..11,090
Insurance Expense………………………………….2,100
Supplies Expense……………………….………..…..485
Total Expenses……………………………………………………..…….56,515
Net Income……………………………………………………….…… 23,285.00

Yedil Kebir Company

Balance Sheet
June 30, 2012
Assets Liabilities
Cash………………………..9,410 Salary Payable……………..1,140
Fees Receivable…………...56,060 Unearned Rent……………....300
Supplies……………….……190 Total Liabilities……………..1,440
Prepaid Insurance…………1,625 Shareholders’ Equity
Prepaid Insurance…………250 Capital……………………..66,095
Total Assets………………..67,535 Total Liabilities & SHE……..67,535

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Project Three: Bank Reconciliation
Pointer PLC
Bank Reconciliation
April 30, 2012
Balance Per Bank Statement………………………………………………………10,367.76
Add: Deposit in transit……………………………………………………………..510.06
Subtotal……………………………………………………………………………..10,877.82
Deduct: Checks Outstanding……………………………………………………….1,479.80
Adjusted Balance………………………………………………………………..….9,398.02

Balance Per Depositor’s Records……………………………………………..…… 7,108.32

Add: Notes Plus Interest………………………………………………………………2,625
Subtotal…………………………………………………...………………………… 9,733.32
Deduct: Bank Service Charge………………………………..24.50
NSF………………...…………………………….…311.80 336.30
Adjusted Balance…………………………………………………………………….9,397.02
Journal Entries
1. Cash in Bank……………………2,625
Notes receivables……………………..………2,500
Interest Income………………………………….125

2. Miscellaneous Expense……………..24.50
NSF…………………………………311.80
Cash in Bank…………………………..336.30

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Project Four: Cost Accounting
1. Prepare Sales Budget for Current Quarter

Sales Budget = Selling Price x Units Sold

Units Sold (A) = 20,000 units
Units Sold (B) = 4,950 units

S.N Types of Product Selling Sold Units Sold Total Revenues

1 Product A 50 20,000 100,000
2 Product B 70 4,950 346,500
Total 120 24,950 1,346,500

2. Prepare Production Budget

Production Budget = Budget Sales + Target Ending FGI – Beginning FGI

Budgeted units Sales (A+B)……………………………………37,550 (30,000 + 7,750)

Add: Ending Finished Goods Inventory (FGI)…………………30,000 (20,000 + 10,000)

Total Required Units………………………………….………. 67,550

Less: Beginning Finished Goods Inventory (FGI)…………....30,000 (21,000 + 9,000)

Units of Finished Goods to be Produced……………………….37,550

3. Prepare Raw Material Purchase Budget

Purchase of DM = DM used in Prodn + End. Inventory of DM – Beg. Inventory of DM

Activity Materials Total

Sand Steel Chemical

Physical Units Budget to be used in

Production………………………….. 12,475 24,950 124,750
Add: Target Ending Inventory………. 30,000 30,000 30,000

Total Requirements…………………. 42,475 54,950 154,750

Less: Beginning Inventory…………. 30,000 30,000 30,000

12,475 24,950 124,750 162,175

Purchase to be made………………

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Project Five

1. Record the necessary journal entry for the above transactions.

I. Raw Material Purchases
Sand……………..….500
Steel…………..…….790
Chemicals…….…...4,500
Accounts Payable………………5,790
II. (A) Material issued (used) to work in process
Job#1 Work in Process………..227.50
Direct Material Inventory………..227.50
Job #2 Work in Process………780
Direct Material Inventory…….780
Job#3 Work in Process………3,900
Direct Material Inventory……3,900

(B) Accrued Payroll (for Labor Cost)

Job#1 Work in Process………..160
Accrued Payroll……………..160
Job #2 Work in Process………210
Accrued Payroll …………….210
Job#3 Work in Process………175
Accrued Payroll ……………175
III. Factory Overhead Applied (80% of Direct Labor Cost)
Job#1 Work in Process………..128
Factory Overhead……………..128
Job #2 Work in Process………168
Factory Overhead …………….168
Job#3 Work in Process………140
Factory Overhead ………..…140
IV. Cash…………………7,800
Sales……………..7,800
2. Calculate the cost of each job
Total cost of each job = Material cost + Direct Labor cost + Factory Overhead
Job#1 = 227.5 + 160 + 128 = 515.50
Job#2 = 780 + 210 + 168 = 1,158
Job#3 = 3,900 + 175 + 140 = 4,215
Total Cost of All Jobs = 515.50 + 1,158 + 4,215 = 5,888.50
3. Calculate the total amount of gross profit
GP = Net Sales – CGS

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 = 7,800 – 5,888.50
= 1,911.50

Project Six
1. Record the following transactions to the journal entries.
March 15: Cash…………………………287,500
VAT Payable…………………………..37,500
Sales…………………………………...250,000
March 16: Entertainment Expense………………5,000
Cash……………………………………….5,000
March 19: Purchase……………………49,000
VAT Receivable…………….7,350
Cash………………………………..56,350
March 25: Salary Expense….……………60,000
Cash………………………………….60,000
March 26: Accounts Receivable……………92,000
VAT Payable…………………………..12,000
Sales…………………………………...80,000
March 27: Utilities Expense………………25,000
Cash…………………………………….25,000
March 31: Supplies Expense………………20,000
Cash………………………………….20,000
March 31: Doubtful Accounts Expense…………8,000
AFDA………………………..………….8,000

MARU Merchandising Company

Trial Balance
March 31, 2013
Account Title Dr Cr
Cash ………………………………………….121,150
Account Receivable……………………..……92,000
VAT Receivable……………………………….7,350
AFDA…………………………………………………………………………………8,000
VAT Payable…………………………………………………………………………49,500
Sales………………………..………………………………………………………..49,000
Purchase……………………………..……..49,000
Entertainment Expense…………………….5,000
Salary Expense……………………………..60,000
Utility Expense…………………………….25,000
Supplies Expense…………………..………20,000
Doubtful Accounts Expense………………..8,000
Total………………………………….…….387,500 387,500

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 2. Calculate the VAT Receivable of VAT Payable
Output VAT (Sales) = 330,000 x 15% = 49,500
Input VAT (Purchase) = 49,000 x 15% = 7,350

VAT Payable = Out VAT – Input VAT

= 49,500 – 7,350
= 42,150

3. Prepare Income Statement for the tax purpose

MARU Merchandising Company

Income Statement
For the month ended March 31, 2013
Sales…………………………………………………………….330,000
Less: CGS………………………………………………………49,000
Gross Profit……………………………………………………281,000
Expenses
Salary Expense……………………………..60,000
Utility Expense…………………………….25,000
Supplies Expense…………………..………20,000
Total Expenses………………..……………………………….105,000
Income before tax……………………………………………..176,000
Income Tax (30%)…………………………………………….52,800
Net Income…………………………………………………….123,200

Project Seven
1. Periodic LIFO
Oct 1 Inventory…………15@30………..450
Oct 10 Purchase………….10@32………..320
Oct 30 Purchase………….10@33………..330
35 1,100

Units Remained on Hand = UAFS – Units Sold

= 35 – 20 = 15 units

Earlist Costs, Oct 1…………..15@30…………450

15 450
Sales
5@35.........................175

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 12@39......................468
3@40.......................120
20 763

Cost of Goods Sold

CGS = Beginning Inventory + Net Purchases – Ending Inventory
= 450 + 650 – 450 = 650
Gross Profit
GP = Net Sales – CGS
= 763 – 650 = 113

2. Perpetual FIFO
Date Purchases CGS Inventory
Qty UC TC Qty UC TC Qty UC TC
Oct 1 15 30 450
4 5 30 150 10 30 300
10 10 32 320 10 30 300
10 32 320
17 10 30 300 8 32 256
2 32 64
22 3 32 96 5 32 160
30 10 33 330 5 32 160
10 33 330

Cost of Goods Sold

CGS = 150 + 300 + 64 + 96 = 610
Or
CGS = Beg Inventory + Net Purchases – Ending Inventory
= 450 + 650 – 490
= 610

Cost of Ending Inventory

= 160 + 330
= 490

Gross Profit
GP = Net Sales – CGS

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 = 763 – 610 = 153

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