1.2.Bank Muamalat entered into Ijarah muntahiya bittamleek with Ali & Co. to finance the purchase offactory machinery of RM400,000.Ali & Co to pay deposit of 10% from the cost of the machine. 10% x400k = 40,000Rental payment is 50k every 6 months or one-year RM100k.The bank will transfer the ownership to Ali for RM20,000. Salvage value of the machine is RM50,000Every year expenses: RM10,000 for gasfuel.Takaful is RM3,000, RM3,000, RM4,000, RM6,000 and RM3,000 for year 1,2,3,4,5 respectively.In the early part of year 5, the machine broke down for 6 month, and had to be repaired at RM25,000Bank Muamalat had to pay legal expense of RM10,000.Required:Prepare the journal entries for the above transaction in Bank Muamalat records.Show the extract balance sheet and profit and loss account at the end of every year.

S. NoParticularDebitCredit1Cash400,000Loans Payable400,0002Machinery400,000Cash40,000Account…

Answered: Prepare the journal entries for the…

Prepare the journal entries for the above transaction in Bank Muamalat records. Show the extract balance sheet and profit and loss account at the end of every year.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Bank Reconciliation Statement

As a commerce student, we all know that every business has to maintain a cash book to maintain all his cash and bank transactions. A cash book is a book which has two columns, one cash column and one bank column.

Question

1.
2.
Bank Muamalat entered into Ijarah muntahiya bittamleek with Ali & Co. to finance the purchase of
factory machinery of RM400,000.
Ali & Co to pay deposit of 10% from the cost of the machine. 10% x400k = 40,000
Rental payment is 50k every 6 months or one-year RM100k.
The bank will transfer the ownership to Ali for RM20,000. Salvage value of the machine is RM50,000
Every year expenses: RM10,000 for gas
fuel.
Takaful is RM3,000, RM3,000, RM4,000, RM6,000 and RM3,000 for year 1,2,3,4,5 respectively.
In the early part of year 5, the machine broke down for 6 month, and had to be repaired at RM25,000
Bank Muamalat had to pay legal expense of RM10,000.
Required:
Prepare the journal entries for the above transaction in Bank Muamalat records.
Show the extract balance sheet and profit and loss account at the end of every year.

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