Ask Question, Ask an Expert


Ask Basic Finance Expert

problem 1) Part A

Malcolm was in business as the import merchant and the following balances were extracted from his books on 31st December 2003:

2099_Import merchant.jpg
Additional Information:

1. Stock at 31st December 2002 was valued at Rs. 17,920.

2. Motor Vehicles are to be depreciated by 20 %.

3. Interest on loan by Donald is at the rate of 12 % per annum and has been paid to 30 September 2003.

4. A provision for doubtful debts at 5% of debtors is to be made.

5. One quarter of the wages was for staff employed in re-packaging the goods for sale.

6. Rates amounting to Rs.800 has been paid in advance for the year 2003.


(a) Prepare the Trading Account and the Profit and Loss Account for the year ended 31st December 2003

(b) Create the Balance Sheet as at 31st December 2003.

(c) Identify 4 User’s of financial statements and briefly describe their information needs.

Part B

The following two paragraphs were included in the auditor’s report of Blue Marlin Company limited:

“The accounts have been prepared on a going concern basis and the validity of this depends on the company’s bankers who are continuing to support by providing adequate overdraft facilities”.

“Because of the materiality of the matters referred to in the previous paragraph we are unable to form an opinion as to whether the accounts give a true and a fair view of the state of affairs of the company:


Describe the following terms

i. Going concern basis

ii. Materiality

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M96359

Have any Question? 

Related Questions in Basic Finance

Maxines pumps or mp sells bilge pumps for 355 each each

Maxine's Pumps or MP sells bilge pumps for $355 each. Each pump costss $255 to produce, and MP's fixed operating costs equal $700,000. What is MP's operating income (NOI) when 10,000 pumps are sold?

1 why do savers with small amounts to invest rarely make

1. Why do savers with small amounts to invest rarely make loans directly to individuals or firms? 2. What are transactions costs? What are information costs? 3. What are financial intermediaries? Why are financial interm ...

1 deriving from the conclusion of proposition i what is the

1. Deriving from the conclusion of Proposition I, what is the crux of M&M Proposition II? What is the natural relationship between the required returns on debt and on equity that results from Proposition II? 2. In what w ...

The wealth transfer decisionnbspplease respond to the

"The Wealth Transfer Decision" Please respond to the following: Imagine that you are an estate planner and a friend is seeking advice regarding leaving property to his children. He has accumulated approximately $1 millio ...

Asset a will have a useful life of 9 years and cost 5m it

Asset A will have a useful life of 9 years and cost $5M; it will have installation costs of $750,000 and an estimated salvage or residual value $500,000. Asset B will have a useful life of 3 years and cost $2.5M; it will ...

1 discuss the rationale and risks associated with using a

1. Discuss the rationale and risks associated with using a common forecast to drive the firms planning/coordination flow. 2. Discuss the role of the CRM system in enhancing the firms competitiveness. 3. Discuss how advan ...

We are going through financial crisis seven years have

We are going through financial crisis. Seven years have passed and we are still in recovery stage. Based on the analysis in the class, can you suggest and elaborate an alternative way to deal with the financial crisis?

Please respond to the followinganalyze the major elements

Please respond to the following: Analyze the major elements of international trade to determine why there is more risk here than in domestic trade. Provide at least 3 examples. Describe one of the risks in detail. Make a ...

1 how many teams of five students each can be formed in a

1. How many teams of five students each can be formed in a class of 15 students? 2. Calculate 4C 2 and 5C 3 . 3. If you are offered $20 to draw a red ball from a bag that contains six green balls, two blue balls, and two ...

Following the end of world war ii in 1945 the reichsmark

Following the end of World War II in 1945, the Reichsmark, the German currency, lost so much value that a barter economy arose. During this period, many Germans used U.S. cigarettes as currency. Why might cigarettes, rat ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen