Accounting: Learning Outcome

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Individual Assignment
Learning outcome
| Question|
1. Demonstrate knowledge and understanding of concepts, principles and techniques of accounting | Q1 (a, b & c) and Q2| 2. Apply appropriate accounting and financial techniques in the preparation, interpretation and presentation of financial statements,| Q1 (a, b & c)| 3. Apply and evaluate financial techniques for management planning, decision making and control in the short, medium and long term.| Exam|

QUESTION 1
Delta Ltd is a medium size firm dealing with furniture business. The condensed financial accounts for the last three years are summarized below: Income Statement for the financial year ended 31 December as follows:

FY| 2009| 2010| 2011|
| $’000| $’000| $’000| $’000| $’000| $’000| Sales (all on credit)| | 500| | 750| | 990|
Cost of goods sold| | | | | | |
Opening inventory| 40| | 35| | 60| |
Purchases| 425| | 650| | 900| |
| 465| | 685| | 960| |
Closing inventory| 35| 430| 60| 625| 120| 840|
Gross profit| | 70| | 125| | 150|
Less expenses| 40| | 60| | 70| |
Loan Interest| -| 40| -| 60| 10| 80|
Net profit| | 30| | 65| | 70|

Balance Sheet as at 31 December
FY| 2009| 2010| 2011|
| $’000| $’000| | $’000| $’000| $’000|
Non-current Assets| | 80| | 95| | 110|
Current assets| | | | | | |
Inventory| 35| | 60| | 110| |
Trade Debtors| 60| | 110| | 250| |
Cash at Bank| 20| 115| 10| 180| -| 360|
Financed by| | 195| | 275| | 470|
| | | | | | |
Beginning Capital| | 100| | 118| | 148|
Net profit| 30| | 65| | 70| |
Drawings| 12| 18| 35| 30| 38| 32|
Ending Capital| | 118| | 148| | 180|
Loan| | -| | -| | 120|
Current Liabilities| | | | | | |
Creditors| 77| | 127| | 150| |
Bank overdraft| -| 77| -| 127| 20| 170|
| | 195| | 275...
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