Financial reporting Final Project

Group Members
Muneeb Khalid S2019314002
Muhammad Usman Tahir S2019314026
Talha Zubair S2019314009
Muhmmmad Shafeeq Ahmed S2019314025
roject
 Trial Balance Of year One
Dr Cr
cash 38000
office supplies 31200
Buliding 168000
Accumlated dep 14000
Accounts payable 4400
Unearned Revenue 10000
Income Taxes 5000
capital stock 51000
Retained Earning 46600
Dividend 30000
Client Revenue 250000
salaries Expense 50000
utilities 9000
depreciation 4800
interest expense 10000
income taxes 40000
Total 381000 381000
Accounts Debits
Dr. Cash 250,000
Cr. Common Stock
Cr. Additional Paid-in Capital

Dr. Legal Fee Expense 3,900

Cr. Cash

Dr. Building 52,000

Dr. Land 103,000
Cr. Mortgage Payable
Cr. Cash

Dr. Building 33,000

Cr. Cash

Dr. Metal Detectors 120,000

Cr. Cash

Dr. Inventory 2,000

Cr. Accounts Payable

Dr. Software 2100

Cr. Cash

Dr. Prepaid Advertising 8,000

Cr. Cash

Dr. Notes Receivable 5,000

Cr. Cash

Dr. Retained Earnings 2,500

Cr. Dividends Payable

Dr. Accounts Payable 2,000

Cr. Cash

Dr. Dividends Payable 2,500

 Cr. Cash

Dr. Cash 1,200

Cr. Unearned Rental Revenue

Dr. Cash 120,100

Dr. Accounts Receivable 4,200
Cr. Rental Revenue

Dr. Inventory 40,000

Cr. Cash
Cr. Accounts Payable

Dr. Cash 35,000

Cr. Sales

Dr. Cost of Goods Sold 30,000

Cr. Inventory

Dr. Salaries and Wages Expense (+E, 82,000

Cr. Cash

Dr. Interest Expense 4,900

Cr. Interest Payable
Dr. Software Amortization 350
Cr. Software

Dr. Advertising Expense 4,000

Cr. Prepaid Advertising

Dr. Interest Receivable 250

Cr. Interest Revenue

Dr. Unearned Rental Revenue 100

Cr. Rental Revenue

Dr. Income Tax Expense 630

Cr. Income Taxes Payable
Credits

25,000
225,000

3,900

124,000
31,000

33,000

120,000

2,000

2100

8,000

5,000

2,500

2,000
 2,500

1,200

124,300

38,000
2,000

35,000

30,000

82,000

4,900

350

4,000

250

100

630
 Cash (A) Land (A)
250,000 3900 103000
1,200 31000
120,100 33000 103000
50,000 120000
2100
8000 Income Taxes
2000 Payable (L)
5000
2500
38000
82000
93,800 327500

Metal Detectors (A) Unearned Rental

120000 Revenue
100 (L)1200

120000 1100

Notes Receivable (A) Software (A)

5000 2100
350
5000 1750

Interest Receivable (A) Accounts Payable

(L)
2000
250

Inventory (A) Interest Payable (L)

2000 30000 4900
40000
4900
12000

Prepaid Advertising (A) Sales (R)

8000 4000 50000

4000 50000

Rental Revenue (R) Advertising Exp.

204300 (E)
4000
100
204400 4000
 Interest Revenue (R) Bldg. Depreciation
250 Exp. (E)
3000

250 3000

Met Det Depreciation Exp. (E) Salary& Wages

30000 Exp. (E)
82000

30000 82000
 Dividends Payable Buildings (A)
(L)
2500 2500 52000
33000
0 85000

Income Taxes Acm. Depreciation (XA)

Payable (L) 630 3000
30000
630
33000

Accounts Receivable (A) Mortgage Payable

4200 (L) 124000

4200 124000

Common Stock (SE)

25000

25000

Accounts Payable Additional Paid-in-Capital (SE)

(L) 2000 225000
2000
225000
2000
Retained Earings
2500

2500

Legal Fee Exp. (E) Interest Expense (E)

3900 4900

3900 4900

Income Tax Exp. (E)

630

630
Cost of Goods Sold (E)
30000

30000

Software Amortization
(E)
350

350
Pusrchase an car last year with amount 300000 and usefull life 10 years
and later we realize that at year 3 there is change in useful life car wont last 10 years it ended up 8 year

Asstet value 300000 Depreciation

useful 10
reidual valure nil Change Deprecitaion
change in usefull life 8 years

years NBV Depreciation Closing

1 300000 30000 270000
2 270000 30000 240000
3 240000 40000 200000
4 200000 40000 160000
5 160000 40000 120000
6 120000 40000 80000
7 80000 40000 40000
8 40000 40000 0

Journal Entires

Income Statement
year 1 Depreciation Expense 30000
Balance Sheet
Cash 300000
Acc.Depreciation 30000
270000
Income Statement
year 2 Depreciation Expense 30000
Balance Sheet
year 2 Cash 270000
Acc.Depreciation 30000
240000
Income Statement
year 3 Depreciation Expense 40000

Balance Sheet
year 3 Cash 240000
Acc.Depreciation 40000
200000
Income Statement
year 4 Depreciation Expense 40000

Balance Sheet
year 4 Cash 200000
Acc.Depreciation 40000
 160000
Income Statement
year 5 Depreciation Expense 40000
Balance Sheet
year 5 Cash 160000
Acc.Depreciation 40000
120000
Income Statement
year 6 Depreciation Expense 40000
Balance Sheet
year 6 Cash 120000
Acc.Depreciation 40000
80000

Income Statement
year 7 Depreciation Expense 40000

Balance Sheet
year 7 Cash 80000
Acc.Depreciation 40000
40000
Income Statement
year 8 Depreciation Expense 40000
Balance Sheet
year 8 Cash 40000
Acc.Depreciation 40000
0
years it ended up 8 year

30000

40000

For year 1 And 2

DR Depreciation Expens 30000

CR Acc.Depreciation 30000

For Further years Depreciation Expense 40000

Acc.Dep 40000
DR (Assest) 300000
CR Cash 300000
Government Gives grant on asset 50% and asset amount 30000 for 10 years

asset worth 30000 3000 Depreciationa mount

government grant 50%
years 10

By Gross Method

year NBV Depreciation Closing

1 30000 3000 27000
2 27000 3000 24000
3 24000 3000 21000
4 21000 3000 18000
5 18000 3000 15000
6 15000 3000 12000
7 12000 3000 9000
8 9000 3000 6000
9 6000 3000 3000
10 3000 3000 0

Government Grant

1 15000 1500 13500

2 13500 1500 12000
3 12000 1500 10500
4 10500 1500 9000
5 9000 1500 7500
6 7500 1500 6000
7 6000 1500 4500
8 4500 1500 3000
9 3000 1500 1500
10 1500 1500 0

Journal Entries
Dr cash 15000 Dr
Cr deferred income 15000 Cr

Dr deferred Income 1500

Cr Grant Income 1500

Year 1
Deffered Income 15000
Misc Expense 1500
Grant payable 13500

year 2 Deferred Income 13500

Miss Expense 1500
Grant Payable 12000

year 3 Deffered Income 12000

Misc Expense 1500
Grant payable 10500

This process will be continue untill Grant repayment

 grant income 1500

asset 30000
cash 30000
purchase a further fixed assest and after 2 years disposal of the assest and mothly depreciation charge

Assest cost 25000

usefull years 10
residual value nill
deprecaion 2500

year NBV Depreciation

1 25000 2500
2 22500 2500
3 20000 2500
4 17500 2500
5 15000 2500
6 12500 2500
7 10000 2500
8 7500 2500
9 5000 2500
10 2500 2500

Asset dispose after four years in moths of feburary

NBV year 4 15000
depreciation 417
NBV value at time of sale 14583

Acc. Depreciation 10417

cost 15000

cost 25000
gain 417
loss 25417
eciation charge

Closing
22500
20000
17500
15000
12500
10000
7500
5000
2500
0
operating lease
company purcahse an Assest on operating lease intsallments 20000 yearly KIBOR rate 7%

PMT (20,000)
interest rate 0
years 5

present value Annuity due 82,004

Amortization Depreciation schedule

year loans installment
1 82,004 20,000
2 67,744 20,000
3 52,486 20,000
4 36,160 20,000
5 18,692 20,000

Journal Entries
right of used Asset 82,004
right of used Liablity 82,004

1 ROU liablity 5,740

lease expense 14,260
cash 20,000

2 ROU liablity 4,742

lease expense 15,258
cash 20,000

3 ROU liablity 3,674

lease expense 16,326
cash 20,000

4 ROU liablity 2,531

lease expense 17,469
cash 20,000

5 ROU liablity 1,400

lease expense 18,600
cash 20,000
 finanace lease
KIBOR rate 7% On 1 April 2009 Bush Co entered into an agreement to
f.v 14,275
finance cost 15% per anm
payable in arrears 5,000
years 4

dr ppe
cr finance lease

interest principal closing depreciaation 3,569

5,740 14,260 67,744
4,742 15,258 52,486 dr 3,569
3,674 16,326 36,160 cr 3,569
2,531 17,469 18,692
1,400 18,600 92 year b/f
1 14,275
2 11,416
3 8,129

p/l
dep
f.cost

balance sheet
non current asset
c.v machine
non cur liab
lease obligation
cuurent liab
lease obligation
ered into an agreement to lease a machine that had an estimated life of four years.

14,275
14,275

inteeest rental c/f

2,141 5,000 11,416
1,712 5,000 8,129
1,219 5,000 4,348

3,569
2,141

10,706

8,129

3,288
 IAS 33 Earning per share
Profit attributable for Year 1 to ordinary shareholders of P:
Weighted-average number of ordinary shares outstanding during Year 1:

Basic Eps=Net profit/WAN no. of shares 0.35

Diluted EPS 0.45

convertible loan stock 100000

14% 14000
14000(1-35)
after tax 9100

convertible in three years 20000

 17,500.00
tstanding during Year 1: 50000
provision
depict how a written off 200 bad debt provision will be recorded in the books of accounts.

dr cr
expense 200
bad debt provision 200

contigent liab

dr cr
expense 420
waranty liabiliyu 420
 Trial Balance Of year One
DR CR
Cash 93800
Accounts Receivable 4200
Notes Receivable 5000
Interest Receivable 250
Inventory 12000
Prepaid Advertising 4000
Land 103000
Buildings 85000
Metal Detectors 120000
Accumulated Depreciation 37000
Software 1750

Accounts Payable 2000

Interest Payable 4900
Dividends Payable 2500
Income Taxes Payable 630
Unearned Rental Revenue 1100
Mortgage Payable 124000
Common Stock 25000
Additional Paid-in-Capital 225000

Rental Revenue 124400

Sales 50000
Interest Revenue 250
Misc Expense 1500
cost Of good sold 30000
Retained Earnings 2500
Salaries and Wages Expense 82000
Legal Fees Expense 3900
Advertising Expense 4000
machine Depreciation Exp. 30000
Grant Depreciation Exp. 3000
Software Amortization 350
Interest Expense 4900
Income Tax Expense 630
Total 594280 594280
 Income Statement

Revenues:
Rental Revenue 124400
Sales 50000
Total Revenue 174400

Cost of Revenues:
Depreciation Exp. 33568
Software Amortization 350
Cost of Goods Sold 30000
Total Costs of Revenue 63918
Gross Profit 110482

Selling, General, and Administative Expenses:

provision 620
Salaries and Wages 82000
Legal Fees 3900
Advertising 4000
. Depreciation 6950
Total SG&A Expenses 97470
Operating Income 13012
Interest Revenue 250
Interest Expense 4900
Before tax income 8362

Income Tax Expense 630

Net Income 7732
Statements Of equity Changes

Retained Earnings 0
Add Net Income 7732
Sub total 7732
less dividend 2500
Retained Earnings Closing 5232
Assets
Cash 93800
Accounts Receivable 4200
Notes Receivable 6500
Interest Receivable 250
Inventory 12000
Prepaid Advertising 4000
Total Current Assets 120750
c.value machine lease 12898
Land 103000
Buildings 85000
Machine 120000
Less Accumulated Depreciation 37000
Net Property, Plant, & Equipment 271000

Software 1750

Total Assets 406398

Liabilities and Shareholders' Equity

provision 620
Accounts Payable 8500
Interest Payable 4900
Income Taxes Payable 630
Unearned Rental Revenue 1100
lease obligation 3288
Total Current Liabilities 19038
lease obligation 8128
Mortgage Payable 124000
Total Liabilities 132128
151166
Common Stock 25000
Additional Paid-in-Capital 225000
Retained Earnings 5232
Total Shareholders' Equity 255232

Total Liabilities and Shareholders' Equity 406398 0