PRINCIPLES OF ACCOUNTING & FINANCE

PRINCIPLES OF ACCOUNTING & FINANCE

2)

· All answers should be typewritten using Arial size 12 in the solution templates provided.

Don't use plagiarized sources. Get Your Custom Essay on
PRINCIPLES OF ACCOUNTING & FINANCE
Just from $13/Page
Order Essay

Marks

Question 1

 
20

Question 2

 
20

Question 3

 
30

Question 4

 
30

TOTAL

 
100

 

Question 1 (20 marks)

 

Fausi started FitnessPro Pte Ltd on 1 July 2021. The company sells a wide range of health equipment and conducts personal training sessions. The retail shop is located at Tampines and the office is at Ubi.

 

Fausi prepared the following Profit and Loss Statement and Balance Sheet for the company after 12 months of operations and thinks that there are errors in the statements. He needs your assistance to check and prepare the corrected classified Profit and Loss Statement and Balance Sheet.

 

Fausi
Profit and Loss Statement as at 30 June 2022
  $ $ $
Sales Revenue   120,000  
Accrued Revenue   4,000  
Personal Training Fees Revenue   35,000  
Gross Profit     159,000
       
Less: Operating Expense      
Selling Expense      
Salaries Expense (refer to Note 1) 40,000    
Accrued Expense 2,000 42,000  
       
General and Administrative Expense      
Interest Expense 3,700    
Rent Expense (refer to Note 2) 36,000    
Shares in Singtel 10,000    
Delivery Van Expense 4,000    
Depreciation – Delivery Van 3,000 56,700  
       
Financial Expense      
Prepaid Expense 3,100    
Bank Charges 400    
Telephone Expense 2,000 5,500 104,200
       
Net Profit     54,800

 

 

Fausi
Balance Sheet for the year ended 30 June 2022
Equity $ $ $
Capital     55,000
Add: Net Profit     54,800
Less: Drawings     6,000
      103,800
Represented by:      
Current Assets      
Cash at Bank   17,600  
Inventories   38,000  
Accounts Payable   12,350  
Delivery Van 30,000    
Add: Accumulated Depreciation – Delivery Van 9,000 39,000  
    106,950  
Less: Current Liabilities      
Loan from BOA (due 1 Jul 2024) 40,000    
Accounts Receivable 21,050 61,050  
       
Working Capital     45,900
       
Non-Current Assets      
Cost of Goods Sold   60,500  
Unearned Revenue   6,000 66,500
       
Total Assets     112,400

 

Additional Information

1) A0% (A is the 4th digit of your admin number) of the salaries are for salesmen and the remaining are for office staff.

 

e.g. if your admin number is 2112345J, then the figure is 20%

if your admin number is 2103202J, then the figure is 30%

if the 4th digit of your admin number is 0 (e.g. 2100002J), then use 40%

 

2) Rent expense of $B,000 (B is the 5th digit of your admin number) is used for the shop and the remaining is for the office.

 

e.g. if your admin number is 2123456J, then the figure is $4,000

if your admin number is 2123567J, then the figure is $5,000

if the 5th digit of your admin number is 0 (e.g. 2100002J), then use $5,000.

 
Profit and Loss Statement
  $ $ $
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       

(9 marks)

 

 

 

 

 

Balance Sheet

  $ $ $
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       

(11 marks)

Question 2 (20 marks)

 

Read the article (https://www.businesstimes.com.sg/companies-markets/shares-of-econ-healthcare-close-36-higher-than-its-ipo-price-on-catalist-relisting) on Econ Healthcare (Asia) Limited’s initial public offering (IPO) and answer questions (i) to (v):

 

i) Which stock exchange is the company listed? Mainboard or Catalist? (2m)
 

 

ii) When were the company’s shares first publicly traded on the stock exchange? (1m)
 

 

iii) What was the IPO issue price? (1m)
 

 

iv) How much net proceeds was raised from this IPO? (1m)
 

 

v) How did the company plan to use the proceeds? (1m)
 

 

vi) Assuming that the company is planning to raise S$8 million for future expansion, propose a suitable source of financing to management and give reasons.

 

You are to quote the source of information (e.g. printscreen from website, annual report, etc.)

(14 marks)

 

 

 

 

 

 

Question 3 (30 marks)

 

Kimly Limited and Sheng Siong Group Ltd are public companies limited by shares.

 

About Kimly Limited

Kimly Limited is one of the largest traditional coffee shop operators in Singapore. The Group operates and manages an extensive network of coffee shops, food courts and industrial canteens.

 

About Sheng Siong Group Ltd

Sheng Siong Group Ltd is principally engaged in operating the Sheng Siong groceries chain. Its stores are primarily located in retail locations in the heartlands of Singapore.

 

Note

· Students with an even register number will answer questions related to Kimly Limited.

· Students with an odd register number will answer questions related to Sheng Siong Group Ltd.

· Students who do not do the assigned company will be heavily penalised.

 

Company Assigned  

 

 

a) Refer to the company’s financial statements in the annual report for 2021 and compute the following financial ratios. Show your workings and round your figures to 2 decimal places.

 

Ratio 2021 2020
Net Profit Margin (%)

(use Profit for the Year)

   
Current Ratio

(use Group figures)

   
Debt Ratio (%)

(use Group figures)

   

 

(18 marks)

 

b) Comment on the ratios calculated in part (a).

 

 

 

 

 

 

 

 

 

(12 marks)

 

 

Question 4 (30 marks)

 

Armour Security Pte Ltd sells home security systems. As at 1 October 2022, the cash at bank balance is $210,000. The company’s policy is to maintain a minimum cash balance of $160,000.

 

The company is developing a cash budget for October, November and December 2022, and the following information was gathered:

 

Cash Receipts
1 Sales revenue for August and September 2022 are $200,000 and $180,000 respectively. The forecasted sales revenue for October, November and December 2022 are $220,000, $250,000 and $280,000 respectively.

 

Historically, 70% of the firm’s sales are in cash, 20% are collected in the next month, and the remaining 10% are collected in the second month following the sale.

2 Monthly commission income is received from the wholesaler based on C% of the current month’s sale (C is the 6th digit of your admin number).

 

(Use 6% if the 6th digit of your admin number is 0)

3 Dividend income of $8,000 will be received in November 2022.
Cash Disbursements
4 The expected purchases are $140,000, $160,000 and $170,000 for the months of October, November and December 2022 respectively. The company pays all its purchases in the month of purchase.
5 Salaries paid monthly is $D0,000. (D is the 7th digit of your admin number)

 

(Use $70,000 if the 7th digit of your admin number is 0)

6 Rental of $9,000 is paid monthly.
7 Payment for an overseas investment of $300,000 and $400,000 are expected to be made in November and December 2022 respectively.

 

Use the following templates to prepare the cash budget for October, November and December 2022:

a) Projected Cash Receipts

Receipts Aug

$

Sep

$

Oct

$

Nov

$

Dec

$

Sales 200,000 180,000 220,000 250,000 280,000
           
Cash sales (70%)          
Lag 1 month (20%)          
Lag 2 months (10%)          
Commission income (C%)          
Dividend income          
Total Cash Receipts          

(13 marks)

 

b) Projected Cash Disbursements

Disbursements Oct

$

Nov

$

Dec

$

Cash purchase      
Salaries ($D0,000)      
Rental      
Investment      
Total Cash Disbursements      

(8 marks)

 

c) Cash Budget

  Oct

$

Nov

$

Dec

$

Total cash receipts      
Less: Total cash disbursements      
Net cash flow      
Add: Beginning cash      
Ending cash      
Minimum cash      
Required Financing      
Excess Cash Balance      

(9 marks)

Essaywriters4me

Calculate The Price Of Your Paper

Pages
{{total || ""}}

Why Choose Us

Top Quality and Well-Researched Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.

Professional and Experienced Academic Writers

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Unlimited Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.

Prompt Delivery and 100% Money-Back-Guarantee

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.

Customer Support 24/7

Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Freebies
Our FREE services
Every order comes with these awesome features.
Order Now
Money Back Guarantee
FREE Best essay writer across your subject
FREE Cover page and bibliography
FREE APA/MLA/Chicago formatting
FREE Free Revisions
FREE 24/7 customer support hotline and chat

Essays

Essay Writing Services

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.

Admissions

Admission and Business Papers

An admission essay is an essay or other written statement by a candidate, often a potential student enrolling in a college, university, or graduate school. You can be rest assurred that through our service we will write the best admission essay for you.

Editing

Editing and Proofreading

Our academic writers and editors make the necessary changes to your paper so that it is polished. We also format your document by correctly quoting the sources and creating reference lists in the formats APA, Harvard, MLA, Chicago / Turabian.

Coursework

Revision Support

If you think your paper could be improved, you can request a review. In this case, your paper will be checked by the writer or assigned to an editor. You can use this option as many times as you see fit. This is free because we want you to be completely satisfied with the service offered.