Advanced Financial Accounting / Acct302

College of Administrative and Financial Sciences

Assignment 2
Deadline: 23 /11/ 2024 @ 23:59

Course Name: Advanced Financial
Accounting

Student’s Name:

Course Code: ACCT 302

Student’s ID Number:

Semester: First Semester

CRN:
Academic Year: 1446 H (2024-2025)

For Instructor’s Use only
Instructor’s Name: Dr Fathimunisa Hanfy
Level of Marks: High/Middle/Low
Students’ Grade:
/15
Instructions – PLEASE READ THEM CAREFULLY
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The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.

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Assignments submitted through email will not be accepted.

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Students are advised to make their work clear and well presented, marks may be reduced for poor
presentation. This includes filling your information on the cover page.

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Students must mention question number clearly in their answer.

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Late submission will NOT be accepted.

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Avoid plagiarism, the work should be in your own words, copying from students or other
resources without proper referencing will result in ZERO marks. No exceptions.

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All answers must be typed using Times New Roman (size 12, double-spaced) font. No pictures
containing text will be accepted and will be considered plagiarism.

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Restricted – ‫مقيد‬

Submissions without this cover page will NOT be accepted.

Assignment 02
Q.1 The Abdullah and Ahad partnership has the following plan for the distribution of
partnership net income (loss):
Particulars
Salaries
Bonus on Net Income
Interest on average Capital Balance
Remainder (if Positive Balance)
Remainder (if Negative Balance)

Abdullah
80000
6%
7%
60%
50%

Ahad
100000
12%
7%
40%
50%

Required:
Calculate the distribution of partnership net income (loss) for each independent situation
below (for each situation, assume the average capital balance of Abdullah is $140,000
and of Ahad is $240,000).
1. Partnership net income is $360,000. (2 Marks)
2. Partnership net income is $240,000. (2 Marks)
3. Partnership net loss is $40,000.
(2 Marks)

Restricted – ‫مقيد‬

2. On Jan, 1 2014, Peter Corp. (a U.S. based company) formed a new subsidiary in
Saudi Arabia, Saeed Inc., with an initial investment of 30,000 SAR.
Assume Saeed Inc.
Purchases inventory evenly throughout 2014. The ending inventory is purchased
Nov. 30, 2014.
Uses straight-line depreciation on fixed assets.
Declares and pays dividends on Nov. 30, 2014.
Purchased the fixed assets on April 1, 2014.
Uses SAR as the functional currency.
Exchange Rates are given:
Jan 1, 2014
0.260
April 1, 2014
0.255
Nov. 30, 2014
0.240
Dec. 31, 2014
0.238
Saeed’s financial statements on Dec. 31, 2014
Accounts
Cash
Account Receivable
Inventory
Note Receivables
Plant & Equipment
Cost of Goods sold
Depreciation
Other Expenses
Dividends
Total Debits
ACC. OC – Translation Adjustment (Debit)

SAR
5000
12000
32000
5000
70000
32000
2000
18000
16000
192000

Adjusted Total Credit
Accumulated Depreciation
Account Payable
Bonds Payable
Mortgage Payable

Restricted – ‫مقيد‬

2000
12000
36000
46000

Common Stock
Sales
Total Credits

30000
66000
192000

REQUIRED
Prepare a schedule to translate Saeed’s financial statements on Dec. 31, 2014 to
U.S. dollars.
(6 Marks)

Restricted – ‫مقيد‬

Q.3 Anwar and Bravo wish to form the A&B partnership. Anwar contributes land
with a book value of $ 175,000 (current value of $200,000) and a building with a
book value of $200,000 (current value of $300,000). Bravo will contribute cash. If
the partners plan to share profits and losses equally after the formation of the
partnership and assuming they have agreed to equal capital contributions, how much
cash will Bravo have to contribute to form the partnership? Pass Journal entry to be
recorded in A&B Firm.

Restricted – ‫مقيد‬

(3 Mark)

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