On 1 January 2020, Mamin Mali started a business by bringing in cash amounting to RM110,000. The nature of the business is supplying books and stationeries to schools and colleges. The business was registered as El Jay Sdn Bhd. Mamin Mali closes the company’s accounts every month and applies perpetual inventory system in maintaining its inventories. The balances of the company’s accounts as at 30 April 2020 are as follows: ACCOUNTS RM Cash 26,700 Accounts receivable 33,700 Merchandise inventory 25,000 Store supplies 5,500 Prepaid insurance 2,000 Store equipment 55,200 Delivery van 48,000 Notes payable 38,100 Accounts payable 48,000 The following transactions were completed in May 2020: Date Transactions May 1 Purchased merchandise from SazLee Company, RM2,500, FOB shipping point, terms 5/15, n/30. The transportation cost of RM200 was paid to the transportation company. 3 Sold merchandise to Remy Enterprise, RM18,700, term 3/10, n/30, FOB shipping point. The cost of the merchandise, RM7.900. The transportation cost incurred was RM150. 5 Received credit memo from SazLee Company for the merchandise returned, RM500. 6 Paid advertising expense, RM390. 9 Paid SazLee Company in full. 10 Sold merchandise to EmDan Company on credit, listed price, RM20,000, trade discount 15%, credit term 2/10, n/eom. FOB destination. The cost of the merchandise, RM6,800. 12 Purchased merchandise from SayMee, RM5,000, term 2/10, n/30 and FOB destination. The transportation cost was RM200. 14 Paid transportation cost for May 10 sales, RM270. 17 Allowed credit to EmDan Company for the merchandise returned, RM500. The merchandise cost was RM240. 20 Received payment in full from Remy Enterprise. 23 Sold merchandise for cash RM5,000 which had a cost of RM2,300. 28 Paid utility expense, RM300, salary expense, RM7,000 and miscellaneous expenses, RM5,000. 29 Paid RM15,000 cash for notes payable due. The following adjustments are to be made at the end of the month: 1. Store equipment and delivery van were bought on 1 February 2020 and no depreciations have been recorded. The annual depreciation rate for both assets is 10%. 2. A check on store supplies showed a balance of RM2,000 at the end of the month. 3. Utility expense accrued RM200. 4. On 1 January 2020, the company has paid in advance, RM3,000 for insurance covering from January to December 2020. REQUIRED: (a) Journalize all the transactions occurred in May 2020. (b) Prepare the adjusting entries for the month of May 2020. (c) Prepare the trial balance as at 31 May 2020. (d) Prepare the Statement of Profit or Loss for the month ended 31 May 2020. (e) Prepare the Statement of Financial Position as at 31 May 2020. (f) Journalize the closing entries for the month. (g) Prepare the trial balance after closing the accounts.
On 1 January 2020, Mamin Mali started a business by bringing in cash amounting to RM110,000.
The nature of the business is supplying books and stationeries to schools and colleges. The
business was registered as El Jay Sdn Bhd.
Mamin Mali closes the company’s accounts every month and applies perpetual inventory system
in maintaining its inventories. The balances of the company’s accounts as at 30 April 2020 are as
follows:
ACCOUNTS RM
Cash 26,700
Accounts receivable 33,700
Merchandise inventory 25,000
Store supplies 5,500
Prepaid insurance 2,000
Store equipment 55,200
Delivery van 48,000
Notes payable 38,100
Accounts payable 48,000
The following transactions were completed in May 2020:
Date Transactions
May 1 Purchased merchandise from SazLee Company, RM2,500, FOB shipping point,
terms 5/15, n/30. The transportation cost of RM200 was paid to the
transportation company.
3 Sold merchandise to Remy Enterprise, RM18,700, term 3/10, n/30, FOB
shipping point. The cost of the merchandise, RM7.900. The transportation cost
incurred was RM150.
5 Received credit memo from SazLee Company for the merchandise returned,
RM500.
6 Paid advertising expense, RM390.
9 Paid SazLee Company in full.
10 Sold merchandise to EmDan Company on credit, listed price, RM20,000, trade
discount 15%, credit term 2/10, n/eom. FOB destination. The cost of the
merchandise, RM6,800.
12 Purchased merchandise from SayMee, RM5,000, term 2/10, n/30 and FOB
destination. The transportation cost was RM200.
14 Paid transportation cost for May 10 sales, RM270.
17 Allowed credit to EmDan Company for the merchandise returned, RM500. The
merchandise cost was RM240.
20 Received payment in full from Remy Enterprise.
23 Sold merchandise for cash RM5,000 which had a cost of RM2,300.
28 Paid utility expense, RM300, salary expense, RM7,000 and miscellaneous
expenses, RM5,000.
29 Paid RM15,000 cash for notes payable due.
The following adjustments are to be made at the end of the month:
1. Store equipment and delivery van were bought on 1 February 2020 and no depreciations
have been recorded. The annual
2. A check on store supplies showed a balance of RM2,000 at the end of the month.
3. Utility expense accrued RM200.
4. On 1 January 2020, the company has paid in advance, RM3,000 for insurance covering
from January to December 2020.
REQUIRED:
(a) Journalize all the transactions occurred in May 2020.
(b) Prepare the
(c) Prepare the
(d) Prepare the Statement of Profit or Loss for the month ended 31 May 2020.
(e) Prepare the
(f) Journalize the closing entries for the month.
(g) Prepare the trial balance after closing the accounts.
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