Accounting for Financial Services(AFS) Questions(2010-2013)


Banking Diploma Examination, June 2013

Accounting for Financial Services (AFS)

Time-3 hour’s                                 Full marks-100                                             Pass marks-50

[N.B. Figures in the right-hand margin indicate full marks. Answer any five questions including question no 8]
1. (a) Give a functional and operational definition of accounting.                                                                                      6
    (b) Differentiate between comparability and consistency of accounting information                                               6
    (c) Explain generally accepted accounting principles (GAAP) and cost principle                                                       6
2. (a) What is the basic accounting equation? Define each component of the equation.                                                6
    (b) Identify the basic steps in the recording process                                                                                                             6
     (c) Explain the periodicity assumption and economic entity assumptions.                                                                 6
3. (a) Explain what posting is and how it helps in the recording process.                                                                          6
    (b) Naziya Sanam, a new student in accounting believes that debit balances are favorable and credit
          balances are unfavorable. Is she correct? Discuss.                                                                                                          6
    (c) “Adjusting entris ensures that revenue recognition and matching principles are followed.” – Do you
          agree? Why or Why not?                                                                                                                                                         6
4. Mr. M. Khank opened the Campus Laundry on January 2013       18
    During the first month of operations the following transactions occurred:
                              Jan         1                      Khan invested Tk. 20000.00 cash
                                              2                      Th company paid Tk. 1000.00  cash for store rent
                                              3                      Purchased washers and dryers for Tk. 25000.00, paying Tk. 10000.00 in                                                                        cash and signing a Tk. 15000, 6 month, 12% note.
                                              4                      Paid. Tk. 1200.00 for a one year insurance policy
                                              10                   Received a bill from the Daily News for advertising the opening of the                                                                                 Laundry Tk. 200.00
                                              20                   Khan withdrew Tk. 700.00 cash for personal use.
                                              30                   The company determined that cash receipts for January services for the                                                                           month were Tk. 6200.00
  The chart of accounts followed by M.Khan includes: Cash, M. Khan, capital, M. Khan, Drawing, Rent Expense, Laundry Equipment, Notes payable, Prepaid Insurance, Advertising Expense, Accounts Payable, Services Revenue.
(a)    Journalize the transactions
(b)   Post the transaction to the ledgers;
(c)    Prepare a trial balance at January 31;
5. (a) What are the steps in accounting cycle? Briefly explain                                                                                             9
    (b) What are loan provision requirements for banks as per BRPD circular?                                                                  9
6. (a) Currently how many financial statements are prepared by bank? Briefly describe the contents of
         Each                                                                                                                                                                                                9
     (b) What are the differences between single step and multiple step income statement? Which                            9
         method is followed in banks? Give an example.
7. Write short notes (any six):                                                                                                                                    3 X 6 = 18
    (i) IFRS (ii) Assumptions of CVP analysis (iii) Sunk cost (iv) Window dressing (v) CAMELS rating (vi)   Revenue recognition principle (vii) FOB shipping point (viii) Comprehensive income (ix) Adjusting entry.
8. The trial balance column of the worksheet for Sasse Roofing at March 31, 2012 are as follows: –       28
Account Titles
Debit (Taka)
Accounts Receivable
Roofing Supplies
Accumulated Depreciation- Equipment
Account Payable
Unearned Revenue
J. Sasse, Capital
J. Sasse, Drawing
Service Revenue
Salaries Expense
Miscellaneous Expense
Other Data:
(a)    A Physical count reveals only Tk. 650.00 of roofing supplies on hand.
(b)   Depreciation for March Tk. 250.00
(c)    Unearned revenue amounted to Tk. 170.00 at March 31
(d)   Accrued salaries are Tk. 600.00
(i)                  Complete the worksheet
(ii)                Prepare an income statement
(iii)               Journalize adjusting entries
(iv)              Journalize closing entries







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One Response to Accounting for Financial Services(AFS) Questions(2010-2013)

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