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ACCT1101-会计代写
时间：2023-09-13
ACCT1101 Accounting for Decision Making
Problem Set Assessment
Type: Problem Set/s
Learning Objectives Assessed: 1, 2, 3, 4
Due Date: 20 September 2023 14:00 (2pm Brisbane time)
Weight: 30%
Individual
Task Description:
This assessment is based on a case of a retailing business.
Assignment materials will be released two weeks before the due date.
Topic assessed: Topics 1-5.
Question types: calculations, short answers and recording transactions.
Learning objectives assessed:
1. Identify and explain accounting terms and concepts that are relevant to business decision
making.
2. Record and interpret business transactions and financial statements.
3. Apply relevant and appropriate accounting knowledge and techniques in business problem-solving.
4. Make and justify effective business operating, financing and investing decisions informed by relevant
accounting information.
Page | 2
Assessment Scenario
This assessment is based on a fictitious scenario of a retail business. This scenario is to be used when answering
questions within these assessment questions.
The full assessment scenario is provided below. Extracts of this scenario are provided throughout the
assessment for easy reference when specific data is required for questions.
Lenova Digital
Introduction
Lenova Digital is a Brisbane-based company that specialises in the sale of gaming software and accessories
online. Commission income only is earned from the sales in the online store. It is currently operated by Claire
and Sarah. Claire is an IT specialist and Sarah is a marketing manager. They set up the business on August 1,
2018, by purchasing equipment and developing a basic website. To promote the business, they pay for
advertising on Google and YouTube.
Lenova Digital also sells larger gaming items out of a warehouse that they rent. This segment of the business
purchases gaming chairs, gaming desks and gaming PCs from overseas suppliers. Paul and Sam, who are
employees that work in the warehouse, deliver the inventory to retail stores who purchase these items. Claire
and Sarah pay themselves and their two employees a fortnightly wage.
Lenova Digital is preparing their financial records using an accrual accounting system. They record sales
revenue at the point of delivering the goods to customers. Lenova Digital use a perpetual inventory system to
track and record their inventory. The First-in, First-out method (FIFO) is used to account for the valuation of
inventory and inventory movements. The straight line method is currently used for depreciation, although they
are also considering the diminishing balance method for the future.
Lenova Digital pays for most regular business expenses using a corporate credit card, which they pay monthly.
Claire and Sarah have provided information about the business transactions, their key suppliers and retail
customers and current warehouse inventory items for July 2023.
Suppliers
• Alliance Digital
• Gaming Accessories Co.
• Retail Store Customers
Retail Store Customers
• Gamer’s Rise
• Digital Computer Store
• BBG Games
Page | 3
Current Warehouse Inventory Items
• Gaming chairs
• Gaming desks
• Gaming PCs
Transactions
For all transactions, please ignore GST and assume that all transactions are in Australian dollars.
1. July 1: Lenova Digital signed another 2-year lease for a warehouse and office for $6,000 per month to store
all their inventory. They have paid two months of rent in advance.
2. July 1: Sold 25 chairs for $135 each, 25 desks for $185 each and 10 PCs for $800 each to
Digital Computer Store. Delivery occurred the same day. The customer was given 90 days to pay their account.
3. July 1: Purchased new CCTV camera equipment that was installed on the same day. The total cost of
$18,000 was paid in cash.
4. July 5: An order was placed for 150 gaming chairs at a cost of $80 each and 150 gaming
desks at a cost of $117 each was placed with Gaming Accessories Co. Delivery occurred the same day and the
total was paid in cash.
5. July 6: An order was placed for 75 gaming PCs for $495 each from Alliance Digital. Delivery occurred the
same day and the total was paid in cash.
6. July 7: Sold 50 chairs for $135 each, 50 desks for $185 each and 15 gaming PCs for $800 each to BBG
Games. BBG Games has been given 90 days to pay their account and the products will be delivered to them in
7 days.
7. July 13: An order was placed for 100 gaming chairs at a cost of $75 each and 100 gaming
desks at a cost of $117 each with gaming Accessories Co. Delivery occurred the same day and the total was
paid in cash.
8. July 13: An order was placed with Alliance Digital for 40 gaming PCs for $495 each. Delivery occurred the
same day, and Lenova Digital have 30 days to pay their account.
9. July 14: Total commission income received in cash for the fortnight for the online store is $9,760.
10. July 14: Total wages for the fortnight were paid. This includes $2,500 each paid to Claire and Sarah and
$1,800 each to Sam and Paul.
11. July 14: Delivered goods to BBG Games, following the transaction on July 7.
Page | 4
12. July 15: Sold 40 chairs for $135 each, 40 desks for $185 each, and 30 gaming PCs for $800 each to Gamers
Rise. Delivery occurred the same day. The customer was given 90 days to pay their account.
13. July 24: Sold 100 chairs for $130 each, 100 desks for $180 each and 15 gaming PCs for
$800 each to the Digital Computer Store. Delivery occurred on the same day. The customer
was given 90 days to pay their account.
14. July 28: Total commission income received in cash for the fortnight from the online store is $9,500.
15. July 28: Total wages for the fortnight were paid. This includes $2,500 each paid to Claire and Sarah and
$1,800 each to Sam and Paul.
16. July 30: A payment of $3,300 to the bank loan (inclusive of interest of $300) was made for the month of
July. Note that the business considers interest as a financing cashflow.
17. July 31: A payment was made for various business expenses incurred on the corporate credit card for the
month of July of $3,150.
18. July 31: Paid dividends to shareholders of $15,000.
July 2023 Adjustments at Month End (July 31)
Adjustment 1: Depreciation of assets
Lenova Digital owns four non-current assets as at July 31, 2023. Calculate the total depreciation for the month
for each of the assets below using the straight-line method.
Round calculations to the nearest whole dollar.
Exhibit 1
Equipment Delivery Truck Forklift CCTV
Date of acquisition 1 Aug 2018 1 Sept 2018 1 Sept 2018 1 Jul 2023
Useful life in years 5 8 12 15
Cost $55,500 $160,000 $30,000 $18,000
Residual value $10,000 $60,000 $5,500 $0
Adjustment 2: Recognition of insurance
Lenova Digital needs to recognise the insurance related to the month of July. Insurance of
$7,650 was paid in advance for a 12-month period on 30 June 2023. Round calculations to the nearest whole
dollar.
Page | 5
Adjustment 3: Recognition of advertising
Lenova Digital needs to recognise the advertising related to the month of July. Advertising for a 12-month
period was paid to Google for $4,560 and to YouTube for $6,000 on 30 June 2023. Round calculations to the
nearest whole dollar.
Adjustment 4: Wages Owing
Wages owing but not yet paid as at 31 July were $1,720. Round calculations to the nearest whole dollar.
Adjustment 5: Recognition of rent
Lenova Digital needs to recognise the rent related to the month of July. Refer transaction on July 1. Round
calculations to the nearest whole dollar.
Adjustment 6: Recognition of income
On June 30, a local high school approached Lenova Digital for help. They asked Sarah to visit the school and
provide them with advice on which products would be best for their students to use. They paid $2,500 in
advance for Sarah to consult with them and provide a report outlining the available products. The business
initially recorded unearned revenue on June 30 when the cash was received. Sarah visited the school on July
31. An adjustment needs to be made to recognise the income earned. Round calculations to the nearest whole
dollar.
Part 1: Inventory calculations | Numeric entry
6 marks
Lenova Digital purchased and sold inventory throughout the month of July as shown in the
business transactions listed to the left. To record these transactions in the worksheet, the cost of these purchases
and the cost of the goods sold must be calculated first. Please use the tables below to show these calculations.
The second tab of the Excel spreadsheet also includes these tables so that you can calculate them in Excel
before entering them into Inspera.
These totals will be used in the worksheet.
Enter your answers in the table below using the information within the transactions.
DO NOT use a thousand separator. For example, the correct way to type “One Thousand” is “1000”, not
“1,000” or “1.000”. Only enter numbers. Do not enter dollar signs ($) in the cells.
Use date format DDMMYYYY (e.g., 01032023)
Page | 6
Part 1: Inventory calculations
Questions 1 to 3: Inventory calculations | Numeric entry 2 marks for each table.
DO NOT use a thousand separator. For example, the correct way to type “One Thousand” is “1000”, not
“1,000” or “1.000”. Only enter numbers. Do not enter dollar signs ($) in the cells. Use date format
DDMMYYYY (e.g. 01072023).
Gaming Chairs Inventory Purchases Cost of Sale Balance
Date Qty Cost Total Qty Cost Total Qty Cost Total
Gaming Desks Inventory Purchases Cost of Sale Balance
Date Qty Cost Total Qty Cost Total Qty Cost Total
Gaming PCs Inventory Purchases Cost of Sale Balance
Date Qty Cost Total Qty Cost Total Qty Cost Total
Page | 7
Part 2: Inventory justification
1 mark.
Instructions
Part 2 of this assessment requires you to draw on the decisions you made in Part 1 Inventory calculation and
explain how you calculated the numeric entries you calculated.
Question 4:
Please explain how you calculated the cost of sales for the gaming chairs on 24 July.
Select one alternative:
• The cost of sales was calculated by taking the cost of each inventory unit purchased first and
multiplying it by the number of units sold. This resulted in the cost of sales of 15 chairs at $80 each and
85 chairs at $75 each.
• The cost of sales was calculated by taking the cost of each inventory unit purchased first and
multiplying it by the number of units sold. This resulted in the cost of sales of 100 chairs at $75 each
and 15 chairs at $75 each.
• The cost of sales was calculated by taking the cost of each inventory unit purchased first and
multiplying it by the number of units sold. This resulted in the cost of sales of 85 chairs at $80 each and
15 chairs at $75 each.
• The cost of sales was calculated by finding the average cost of each inventory item purchased. This
resulted in dividing $21,625 by 275 chairs to find the cost of sales per unit of $78.64.
Part 3: Inventory Items
Instructions
Part 3 of this assessment requires you to draw on the decisions you made in Part 1 Inventory calculation and
explain how you calculated the numeric entries you calculated.
DO NOT use a thousand separator. For example, the correct way to type “One Thousand” is “1000”, not
“1,000” or “1.000”. Only enter numbers. Do not enter dollar signs ($) in the cells.
Question 5
This question is a pooled question. Each student has been assigned a different inventory item. Please
refer to Inspera to see your question.
Page | 8
Part 4
Question 6: Depreciation
6 marks.
Calculate the total depreciation for the month of July for each of the assets below using the straight-line
method.
Round calculations to the nearest whole dollar.
Answer by stating your final answer for each cell and do not show workings.
DO NOT use a thousand separator. For example, the correct way to type “One Thousand” is “1000”, not
“1,000” or “1.000”. Only enter numbers. Do not enter dollar signs ($) in the cells.
Equipment Delivery Truck Forklift CCTV
Date of acquisition 01/08/2018 01/09/2018 01/09/2018 01/07/2023
Useful life in years 5 8 12 15
Cost $55,500 $160,000 $30,000 $18,000
Residual value $10,000 $60,000 $5,500 $0
Depreciable amount
Annual depreciation
Accumulated
depreciation as at
30/06/2023
Depreciation expense
for the month July
Accumulated
depreciation as at
31/07/2023
Part 4:
Question 7: Changing depreciation methods
1.5 marks.
Lenova Digital currently use the straight-line method of depreciation for their equipment, delivery truck and
forklift.
i). If they changed to the diminishing balance method of depreciation for their forklift in August 2023, what
would be the impact on the financial statements?
Assume the diminishing balance method resulted in the depreciation expense of $500 for the month of August
2023.
If the business changes from straight-line method to the diminishing balance method:
The depreciation expense for the forklift will be ,
Page | 9
The profit for August will be by the amount of $ ,
The total assets will be ,
The forklift will be ,
The total accumulated depreciation as at 31 August 2023 will be and
The forklift's carrying amount will be .
ii). Can Lenova Digital change from the straight-line to the diminishing balance method?
, accounting standards a business to choose the depreciation method for
a .
Part 5:
Question 8 to Question 12: Completing the worksheet
Questions 8 to 12 requires you to record the business transactions in a worksheet. There is an optional Excel
spreadsheet that you can download from Blackboard to use before filling in your responses in Inspera.
Alternatively, you can put your responses into Inspera without using the Excel spreadsheet. Note: the
spreadsheet does not need to be submitted and will not be used as part of the marking of the assignment.
Part 6:
Question 13: Accrual accounting
2 marks.
a. If Lenova Digital did not receive their order from Alliance Digital on January 13, would this change the way
the transaction is recorded by the business?
b. If the goods were not received, Lenova Digital recognise the purchase as
an in their financial statements.
Part 7:
Question 14: Doubtful debts
1 mark.
This question is a pooled question. Each student has been assigned a different allowance for doubtful
debts question. Please refer to Inspera to see your question.
Page | 10
Part 8:
Question 15: Cash flow management
10 marks.
Lenova Digital is considering acquiring a new line of products to sell to their retailer customers. The product is
an in-home gaming simulator system which includes the latest gaming chair, gaming PC with a large monitor,
and a virtual reality headset. The cost per system is $6,000. The supplier requires a minimum order of 20
systems, which means the total investment in the new line of products will be $120,000. it is expected that
payment will need to be made in October 2023.
Due to the large amount of investment required, the owners of Digital Field Day have determined that the
financing of this purchase could be undertaken in October 2023 by either a bank loan or an additional share
issue to the owners. Lenova Digital have asked you to provide them with advice regarding these financing
options in preparation for Christmas.
Required
a. Identify which cash flow activity within the cash flow statement would increase as a result of the funds
received by the bank loan or share issue. Word limit: a total of 50 words. Any response beyond the word
limit will not be marked.
b. Provide Lenova Digital with a comparison of both options that includes consideration of any repayments, the
effects on cash flows and the associated risk. Note no calculations are required. Word limit: a total of 200
words. Any response beyond the word limit will not be marked.
c. Identify which option is more likely to result in a higher net increase in cash flows within Lenova Digital’s
cash flow statement for the month of October 2023 and explain why. Word limit: a total of 100 words. Any
response beyond the word limit will not be marked.
Page | 11
Part 9:
Question 16: Payment methods
10 marks.
In preparation for the arrival of the gaming simulator systems, Lenova Digital have been informed that their
staff members need to be trained on how to build the systems and integrate software. The training is estimated
to cost $10,000. Lenova Digital have told you that they are considering making the payment either by using
cash or the company credit card. They will be making the purchase on August 2, 2023 and training is expected
to occur on September 1, 2023. The credit card would be required to be paid on September 15, 2023.
Required
a. Provide Lenova Digital with a comparison of the effects that the use of cash versus a credit card has on total
assets, liabilities, equity and the cash flows of the business for August 2, 2023. Note no calculations are
required. Word limit: a total of 200 words. Any response beyond the word limit will not be marked.
b. Identify and briefly explain one (1) other form of payment method that Lenova Digital may be able to use to
pay for the training. Word limit: a total of 50 words. Any response beyond the word limit will not be marked.
c. Provide advice on which method Lenova Digital should use to make the purchase by drawing on the answers
you provided in part a and b. When advising Lenova Digital about your decision, include reference to the
company's current financial situation shown in the worksheet that you prepared in question 10 to 14. Word
limit: a total of 150 words. Any response beyond the word limit will not be marked.
Part 10:
Question 17: Business structures
1 mark.
This question is a pooled question. Each student has been assigned a different business structure
question. Please refer to Inspera to see your question.
Problem Set Assessment
Type: Problem Set/s
Learning Objectives Assessed: 1, 2, 3, 4
Due Date: 20 September 2023 14:00 (2pm Brisbane time)
Weight: 30%
Individual
Task Description:
This assessment is based on a case of a retailing business.
Assignment materials will be released two weeks before the due date.
Topic assessed: Topics 1-5.
Question types: calculations, short answers and recording transactions.
Learning objectives assessed:
1. Identify and explain accounting terms and concepts that are relevant to business decision
making.
2. Record and interpret business transactions and financial statements.
3. Apply relevant and appropriate accounting knowledge and techniques in business problem-solving.
4. Make and justify effective business operating, financing and investing decisions informed by relevant
accounting information.
Page | 2
Assessment Scenario
This assessment is based on a fictitious scenario of a retail business. This scenario is to be used when answering
questions within these assessment questions.
The full assessment scenario is provided below. Extracts of this scenario are provided throughout the
assessment for easy reference when specific data is required for questions.
Lenova Digital
Introduction
Lenova Digital is a Brisbane-based company that specialises in the sale of gaming software and accessories
online. Commission income only is earned from the sales in the online store. It is currently operated by Claire
and Sarah. Claire is an IT specialist and Sarah is a marketing manager. They set up the business on August 1,
2018, by purchasing equipment and developing a basic website. To promote the business, they pay for
advertising on Google and YouTube.
Lenova Digital also sells larger gaming items out of a warehouse that they rent. This segment of the business
purchases gaming chairs, gaming desks and gaming PCs from overseas suppliers. Paul and Sam, who are
employees that work in the warehouse, deliver the inventory to retail stores who purchase these items. Claire
and Sarah pay themselves and their two employees a fortnightly wage.
Lenova Digital is preparing their financial records using an accrual accounting system. They record sales
revenue at the point of delivering the goods to customers. Lenova Digital use a perpetual inventory system to
track and record their inventory. The First-in, First-out method (FIFO) is used to account for the valuation of
inventory and inventory movements. The straight line method is currently used for depreciation, although they
are also considering the diminishing balance method for the future.
Lenova Digital pays for most regular business expenses using a corporate credit card, which they pay monthly.
Claire and Sarah have provided information about the business transactions, their key suppliers and retail
customers and current warehouse inventory items for July 2023.
Suppliers
• Alliance Digital
• Gaming Accessories Co.
• Retail Store Customers
Retail Store Customers
• Gamer’s Rise
• Digital Computer Store
• BBG Games
Page | 3
Current Warehouse Inventory Items
• Gaming chairs
• Gaming desks
• Gaming PCs
Transactions
For all transactions, please ignore GST and assume that all transactions are in Australian dollars.
1. July 1: Lenova Digital signed another 2-year lease for a warehouse and office for $6,000 per month to store
all their inventory. They have paid two months of rent in advance.
2. July 1: Sold 25 chairs for $135 each, 25 desks for $185 each and 10 PCs for $800 each to
Digital Computer Store. Delivery occurred the same day. The customer was given 90 days to pay their account.
3. July 1: Purchased new CCTV camera equipment that was installed on the same day. The total cost of
$18,000 was paid in cash.
4. July 5: An order was placed for 150 gaming chairs at a cost of $80 each and 150 gaming
desks at a cost of $117 each was placed with Gaming Accessories Co. Delivery occurred the same day and the
total was paid in cash.
5. July 6: An order was placed for 75 gaming PCs for $495 each from Alliance Digital. Delivery occurred the
same day and the total was paid in cash.
6. July 7: Sold 50 chairs for $135 each, 50 desks for $185 each and 15 gaming PCs for $800 each to BBG
Games. BBG Games has been given 90 days to pay their account and the products will be delivered to them in
7 days.
7. July 13: An order was placed for 100 gaming chairs at a cost of $75 each and 100 gaming
desks at a cost of $117 each with gaming Accessories Co. Delivery occurred the same day and the total was
paid in cash.
8. July 13: An order was placed with Alliance Digital for 40 gaming PCs for $495 each. Delivery occurred the
same day, and Lenova Digital have 30 days to pay their account.
9. July 14: Total commission income received in cash for the fortnight for the online store is $9,760.
10. July 14: Total wages for the fortnight were paid. This includes $2,500 each paid to Claire and Sarah and
$1,800 each to Sam and Paul.
11. July 14: Delivered goods to BBG Games, following the transaction on July 7.
Page | 4
12. July 15: Sold 40 chairs for $135 each, 40 desks for $185 each, and 30 gaming PCs for $800 each to Gamers
Rise. Delivery occurred the same day. The customer was given 90 days to pay their account.
13. July 24: Sold 100 chairs for $130 each, 100 desks for $180 each and 15 gaming PCs for
$800 each to the Digital Computer Store. Delivery occurred on the same day. The customer
was given 90 days to pay their account.
14. July 28: Total commission income received in cash for the fortnight from the online store is $9,500.
15. July 28: Total wages for the fortnight were paid. This includes $2,500 each paid to Claire and Sarah and
$1,800 each to Sam and Paul.
16. July 30: A payment of $3,300 to the bank loan (inclusive of interest of $300) was made for the month of
July. Note that the business considers interest as a financing cashflow.
17. July 31: A payment was made for various business expenses incurred on the corporate credit card for the
month of July of $3,150.
18. July 31: Paid dividends to shareholders of $15,000.
July 2023 Adjustments at Month End (July 31)
Adjustment 1: Depreciation of assets
Lenova Digital owns four non-current assets as at July 31, 2023. Calculate the total depreciation for the month
for each of the assets below using the straight-line method.
Round calculations to the nearest whole dollar.
Exhibit 1
Equipment Delivery Truck Forklift CCTV
Date of acquisition 1 Aug 2018 1 Sept 2018 1 Sept 2018 1 Jul 2023
Useful life in years 5 8 12 15
Cost $55,500 $160,000 $30,000 $18,000
Residual value $10,000 $60,000 $5,500 $0
Adjustment 2: Recognition of insurance
Lenova Digital needs to recognise the insurance related to the month of July. Insurance of
$7,650 was paid in advance for a 12-month period on 30 June 2023. Round calculations to the nearest whole
dollar.
Page | 5
Adjustment 3: Recognition of advertising
Lenova Digital needs to recognise the advertising related to the month of July. Advertising for a 12-month
period was paid to Google for $4,560 and to YouTube for $6,000 on 30 June 2023. Round calculations to the
nearest whole dollar.
Adjustment 4: Wages Owing
Wages owing but not yet paid as at 31 July were $1,720. Round calculations to the nearest whole dollar.
Adjustment 5: Recognition of rent
Lenova Digital needs to recognise the rent related to the month of July. Refer transaction on July 1. Round
calculations to the nearest whole dollar.
Adjustment 6: Recognition of income
On June 30, a local high school approached Lenova Digital for help. They asked Sarah to visit the school and
provide them with advice on which products would be best for their students to use. They paid $2,500 in
advance for Sarah to consult with them and provide a report outlining the available products. The business
initially recorded unearned revenue on June 30 when the cash was received. Sarah visited the school on July
31. An adjustment needs to be made to recognise the income earned. Round calculations to the nearest whole
dollar.
Part 1: Inventory calculations | Numeric entry
6 marks
Lenova Digital purchased and sold inventory throughout the month of July as shown in the
business transactions listed to the left. To record these transactions in the worksheet, the cost of these purchases
and the cost of the goods sold must be calculated first. Please use the tables below to show these calculations.
The second tab of the Excel spreadsheet also includes these tables so that you can calculate them in Excel
before entering them into Inspera.
These totals will be used in the worksheet.
Enter your answers in the table below using the information within the transactions.
DO NOT use a thousand separator. For example, the correct way to type “One Thousand” is “1000”, not
“1,000” or “1.000”. Only enter numbers. Do not enter dollar signs ($) in the cells.
Use date format DDMMYYYY (e.g., 01032023)
Page | 6
Part 1: Inventory calculations
Questions 1 to 3: Inventory calculations | Numeric entry 2 marks for each table.
DO NOT use a thousand separator. For example, the correct way to type “One Thousand” is “1000”, not
“1,000” or “1.000”. Only enter numbers. Do not enter dollar signs ($) in the cells. Use date format
DDMMYYYY (e.g. 01072023).
Gaming Chairs Inventory Purchases Cost of Sale Balance
Date Qty Cost Total Qty Cost Total Qty Cost Total
Gaming Desks Inventory Purchases Cost of Sale Balance
Date Qty Cost Total Qty Cost Total Qty Cost Total
Gaming PCs Inventory Purchases Cost of Sale Balance
Date Qty Cost Total Qty Cost Total Qty Cost Total
Page | 7
Part 2: Inventory justification
1 mark.
Instructions
Part 2 of this assessment requires you to draw on the decisions you made in Part 1 Inventory calculation and
explain how you calculated the numeric entries you calculated.
Question 4:
Please explain how you calculated the cost of sales for the gaming chairs on 24 July.
Select one alternative:
• The cost of sales was calculated by taking the cost of each inventory unit purchased first and
multiplying it by the number of units sold. This resulted in the cost of sales of 15 chairs at $80 each and
85 chairs at $75 each.
• The cost of sales was calculated by taking the cost of each inventory unit purchased first and
multiplying it by the number of units sold. This resulted in the cost of sales of 100 chairs at $75 each
and 15 chairs at $75 each.
• The cost of sales was calculated by taking the cost of each inventory unit purchased first and
multiplying it by the number of units sold. This resulted in the cost of sales of 85 chairs at $80 each and
15 chairs at $75 each.
• The cost of sales was calculated by finding the average cost of each inventory item purchased. This
resulted in dividing $21,625 by 275 chairs to find the cost of sales per unit of $78.64.
Part 3: Inventory Items
Instructions
Part 3 of this assessment requires you to draw on the decisions you made in Part 1 Inventory calculation and
explain how you calculated the numeric entries you calculated.
DO NOT use a thousand separator. For example, the correct way to type “One Thousand” is “1000”, not
“1,000” or “1.000”. Only enter numbers. Do not enter dollar signs ($) in the cells.
Question 5
This question is a pooled question. Each student has been assigned a different inventory item. Please
refer to Inspera to see your question.
Page | 8
Part 4
Question 6: Depreciation
6 marks.
Calculate the total depreciation for the month of July for each of the assets below using the straight-line
method.
Round calculations to the nearest whole dollar.
Answer by stating your final answer for each cell and do not show workings.
DO NOT use a thousand separator. For example, the correct way to type “One Thousand” is “1000”, not
“1,000” or “1.000”. Only enter numbers. Do not enter dollar signs ($) in the cells.
Equipment Delivery Truck Forklift CCTV
Date of acquisition 01/08/2018 01/09/2018 01/09/2018 01/07/2023
Useful life in years 5 8 12 15
Cost $55,500 $160,000 $30,000 $18,000
Residual value $10,000 $60,000 $5,500 $0
Depreciable amount
Annual depreciation
Accumulated
depreciation as at
30/06/2023
Depreciation expense
for the month July
Accumulated
depreciation as at
31/07/2023
Part 4:
Question 7: Changing depreciation methods
1.5 marks.
Lenova Digital currently use the straight-line method of depreciation for their equipment, delivery truck and
forklift.
i). If they changed to the diminishing balance method of depreciation for their forklift in August 2023, what
would be the impact on the financial statements?
Assume the diminishing balance method resulted in the depreciation expense of $500 for the month of August
2023.
If the business changes from straight-line method to the diminishing balance method:
The depreciation expense for the forklift will be ,
Page | 9
The profit for August will be by the amount of $ ,
The total assets will be ,
The forklift will be ,
The total accumulated depreciation as at 31 August 2023 will be and
The forklift's carrying amount will be .
ii). Can Lenova Digital change from the straight-line to the diminishing balance method?
, accounting standards a business to choose the depreciation method for
a .
Part 5:
Question 8 to Question 12: Completing the worksheet
Questions 8 to 12 requires you to record the business transactions in a worksheet. There is an optional Excel
spreadsheet that you can download from Blackboard to use before filling in your responses in Inspera.
Alternatively, you can put your responses into Inspera without using the Excel spreadsheet. Note: the
spreadsheet does not need to be submitted and will not be used as part of the marking of the assignment.
Part 6:
Question 13: Accrual accounting
2 marks.
a. If Lenova Digital did not receive their order from Alliance Digital on January 13, would this change the way
the transaction is recorded by the business?
b. If the goods were not received, Lenova Digital recognise the purchase as
an in their financial statements.
Part 7:
Question 14: Doubtful debts
1 mark.
This question is a pooled question. Each student has been assigned a different allowance for doubtful
debts question. Please refer to Inspera to see your question.
Page | 10
Part 8:
Question 15: Cash flow management
10 marks.
Lenova Digital is considering acquiring a new line of products to sell to their retailer customers. The product is
an in-home gaming simulator system which includes the latest gaming chair, gaming PC with a large monitor,
and a virtual reality headset. The cost per system is $6,000. The supplier requires a minimum order of 20
systems, which means the total investment in the new line of products will be $120,000. it is expected that
payment will need to be made in October 2023.
Due to the large amount of investment required, the owners of Digital Field Day have determined that the
financing of this purchase could be undertaken in October 2023 by either a bank loan or an additional share
issue to the owners. Lenova Digital have asked you to provide them with advice regarding these financing
options in preparation for Christmas.
Required
a. Identify which cash flow activity within the cash flow statement would increase as a result of the funds
received by the bank loan or share issue. Word limit: a total of 50 words. Any response beyond the word
limit will not be marked.
b. Provide Lenova Digital with a comparison of both options that includes consideration of any repayments, the
effects on cash flows and the associated risk. Note no calculations are required. Word limit: a total of 200
words. Any response beyond the word limit will not be marked.
c. Identify which option is more likely to result in a higher net increase in cash flows within Lenova Digital’s
cash flow statement for the month of October 2023 and explain why. Word limit: a total of 100 words. Any
response beyond the word limit will not be marked.
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Part 9:
Question 16: Payment methods
10 marks.
In preparation for the arrival of the gaming simulator systems, Lenova Digital have been informed that their
staff members need to be trained on how to build the systems and integrate software. The training is estimated
to cost $10,000. Lenova Digital have told you that they are considering making the payment either by using
cash or the company credit card. They will be making the purchase on August 2, 2023 and training is expected
to occur on September 1, 2023. The credit card would be required to be paid on September 15, 2023.
Required
a. Provide Lenova Digital with a comparison of the effects that the use of cash versus a credit card has on total
assets, liabilities, equity and the cash flows of the business for August 2, 2023. Note no calculations are
required. Word limit: a total of 200 words. Any response beyond the word limit will not be marked.
b. Identify and briefly explain one (1) other form of payment method that Lenova Digital may be able to use to
pay for the training. Word limit: a total of 50 words. Any response beyond the word limit will not be marked.
c. Provide advice on which method Lenova Digital should use to make the purchase by drawing on the answers
you provided in part a and b. When advising Lenova Digital about your decision, include reference to the
company's current financial situation shown in the worksheet that you prepared in question 10 to 14. Word
limit: a total of 150 words. Any response beyond the word limit will not be marked.
Part 10:
Question 17: Business structures
1 mark.
This question is a pooled question. Each student has been assigned a different business structure
question. Please refer to Inspera to see your question.
