Pam Jones owns a business named Sunny Renovation

Pam Jones owns a business named Sunny Renovation. Below is the account information of Sunny Renovation at 30 June 2019.

Cash in Bank	$ 45,600	Accounts receivables	$235,200
Supplies	52,800	Prepaid Insurance	16,000
Accounts payable	67,400	Unearned revenue	18,000
Service income	372,000	Salary expense	222,000
Pam Jones, Capital	?	Equipment	130,000

 

Required:

Using the accounting equation, prepare the balance sheet for Sunny Renovation at 30 June 2019 (please use the narrative/vertical format).

During June, Thuy Buoi’s business performed services for a specific customers

Question

During June, Thuy Buoi’s business performed services for a specific customers for which the fee was $5000. Payment was received in the following month of July.

 

Required:

1. Was the revenue earned in June or July? How is profit determined under the cash basis of accounting and the accrual basis of accounting?
2. What journal entries should be recorded under the accrual accounting in June and July?
3. What journal entries should be recorded under cash accounting in June and July?

 

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Moravia Company processes and packages cream cheese. The following data have been compiled for the month of April. Conversion activity occurs uniformly throughout the production process. Work in process, April 1—10,000 units: Direct material: 100% complete, cost of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 22,000 Conversion: 20% complete, cost of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .…

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Tripton Ltd operates a package holiday company in Cardiff

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Question Salad Ltd acquired all the net assets of an existing business, Lettuce Ltd on 1 July 2020. The statements of financial position of the two companies immediately prior to the acquisition were as follows:       Salad Ltd Lettuce Ltd Cash   $4,200 $2,000 Accounts receivable   30,000 16,500 Freehold land   265,000 100,000 Building (net)   35,000 28,000 Cultivation equipment (net)   69,000 46,000 Irrigation equipment   18,000 21,000 Delivery trucks   46,000 36,000 Motor vehicles   30,000 32,000     497,200 281,500 Accounts payable   29,000 24,500 Loan – Bank of NSW   155,000 79,000 Loan – Bernard Bros   35,000 34,000 Loan – Golds Corp.   72,000 52,500 Share capital               110,000 shares 110,000 –                …

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With examples and reference to relevant Australian Accounting Standards, explain the key steps in the acquisition method. Why is it important to identify an acquirer in a business combination?

Flashy Ltd is involved in the manufacture of Ugg boots

Topic 2 – Business Combinations Flashy Ltd is involved in the manufacture of Ugg boots. The director wishes to sell the business to a long-standing competitor, Boots Ltd. The financial statements of Flashy Ltd at 1 July 2019 contained the following information: Assets Liabilities Current assets Liabilities Cash 7,500 Accounts payable 18,900 Accounts receivable 11,000 Other payables 41,000 Inventories 16,500 Provisions 27,000 Total current assets 35,000 Loans 63,000 Total liabilities 149,900 Non-current assets Equity Vehicles 32,000 Share capital: 50,000 shares 48,000 Accumulated depreciation -5,500 Retained earnings 47,800 Trucks 37,000 Total equity 95,800 Accumulated depreciation -6,300 Machinery 22,000 Accumulated depreciation -3,000 Buildings 49,000 Accumulated depreciation -4,500 Land 90,000 Total non-current assets 210,700 Total assets 245,700 Total liabilities  and equity 245,700   An agreement was…