The double entry Non-current assets Case study no. 1: A VAT payer company has the following financial position at the beginning of the financial reporting period: subscribed and paid in social capital 20,000 lei, petty cash 20,000 lei The company records the following transactions referring to noncurrent intangible and tangible assets entering its estate: a) It pays 1,000 lei setup costs through petty cash; b) It purchases software from a supplier at 4,000 lei, VAT 19%; c) It develops machinery measured at a production cost of 40,200 lei Homework: Based on the transactions that were recorded, fill in the corresponding Ledger and Final Balance Sheet. In order to do so, you must first settle the company's accounts with the state in terms of VAT and close the revenue (income) accounts. Case study no. 2: The entity considered for case study no. 1 records monthly amortisation and depreciation by using the straight line depreciation method for the following categories of noncurrent assets: a) For its software, using a 2 years useful life; b) For its machinery, using a 5 years useful life. Homework: Consider the Final Balance Sheet from case study no. 1 as Initial Balance Sheet for case study no. 2. Based on the transactions that were recorded, fill in the corresponding Ledger and Final Balance Sheet. In order to do so, you must first close the expenses accounts. Case study no. 3: A VAT payer company records the following transactions referring to noncurrent intangible and tangible assets that exit its estate: a) It disassembles (Ro. casează) a machinery hav 0 lei, b) It takes out of its records setup cost having an entry value of 800 lei that were totally amortised; c) It sells a motor vehicle at a sales price of 29,750 lei, VAT 19 % included; the motor vehicle's entry value was of 20,000 lei, while its accumulated depreciation is of 18,000 lei. an entry value of 36,000 lei and net book value of
The double entry Non-current assets Case study no. 1: A VAT payer company has the following financial position at the beginning of the financial reporting period: subscribed and paid in social capital 20,000 lei, petty cash 20,000 lei The company records the following transactions referring to noncurrent intangible and tangible assets entering its estate: a) It pays 1,000 lei setup costs through petty cash; b) It purchases software from a supplier at 4,000 lei, VAT 19%; c) It develops machinery measured at a production cost of 40,200 lei Homework: Based on the transactions that were recorded, fill in the corresponding Ledger and Final Balance Sheet. In order to do so, you must first settle the company's accounts with the state in terms of VAT and close the revenue (income) accounts. Case study no. 2: The entity considered for case study no. 1 records monthly amortisation and depreciation by using the straight line depreciation method for the following categories of noncurrent assets: a) For its software, using a 2 years useful life; b) For its machinery, using a 5 years useful life. Homework: Consider the Final Balance Sheet from case study no. 1 as Initial Balance Sheet for case study no. 2. Based on the transactions that were recorded, fill in the corresponding Ledger and Final Balance Sheet. In order to do so, you must first close the expenses accounts. Case study no. 3: A VAT payer company records the following transactions referring to noncurrent intangible and tangible assets that exit its estate: a) It disassembles (Ro. casează) a machinery hav 0 lei, b) It takes out of its records setup cost having an entry value of 800 lei that were totally amortised; c) It sells a motor vehicle at a sales price of 29,750 lei, VAT 19 % included; the motor vehicle's entry value was of 20,000 lei, while its accumulated depreciation is of 18,000 lei. an entry value of 36,000 lei and net book value of
Chapter4: The Adjustment Process
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Problem 2PB: To demonstrate the difference between cash account activity and accrual basis profits (net income),...
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Transcribed Image Text:The double entry
Non-current assets
Case study no. 1: A VAT payer company has the following financial position at the beginning of the
financial reporting period: subscribed and paid in social capital 20,000 lei, petty cash 20,000 lei The
company records the following transactions referring to noncurrent intangible and tangible assets entering
its estate:
a) It pays 1,000 lei setup costs through petty cash;
b) It purchases software from a supplier at 4,000 lei, VAT 19%
c) It develops machinery measured at a production cost of 40,200 lei
Homework: Based on the transactions that were recorded, fill in the corresponding Ledger and Final
Balance Sheet. In order to do so, you must first settle the company's accounts with the state in terms of
VAT and close the revenue (income) accounts.
Case study no. 2: The entity considered for case study no. 1 records monthly amortisation and depreciation
by using the straight line depreciation method for the following categories of noncurrent assets:
a) For its software, using a 2 years useful life;
b) For its machinery, using a 5 years useful life.
Homework: Consider the Final Balance Sheet from case study no. 1 as Initial Balance Sheet for case study
no. 2. Based on the transactions that were recorded, fill in the corresponding Ledger and Final Balance
Sheet. In order to do so, you must first close the expenses accounts.
Case study no. 3: A VAT payer company records the following transactions referring to noncurrent
intangible and tangible assets that exit its estate:
a) It disassembles (Ro. casează) a machinery having an entry value of 36,000 lei and net book value of
0 lei,
b) It takes out of its records setup cost having an entry value of 800 lei that were totally amortised,
c) It sells a motor vehicle at a sales price of 29,750 lei, VAT 19 % included; the motor vehicle's entry
value was of 20,000 lei, while its accumulated depreciation is of 18,000 lei.
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