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In: Accounting

Q10.M/s. Muneer Company is dealing with the dealing with imported cars. The company used to buy...

Q10.M/s. Muneer Company is dealing with the dealing with imported cars. The company used to buy cars from different countries and selling the cars in Sultanate of Oman with 18% profit margin. The company was having following assets and liabilities as on 31st December 2019. The company was having liabilities namely Capital RO 285,200, loan borrowed RO 75,800, amount payable to creditors RO 22,580, outstanding expenses RO 17580 and salary payable to family members who are not employees of the business RO 2,550. The assets consist of Cars RO 228,900, machinery 42,580, furniture RO 22,869, Bank balance of RO 148,500. Treasury bills RO 32650, short term notes receivables RO 32,580, money market funds RO 16,580 and money due to brother which borrowed for the personal expenses RO 4,550.                                 

You are required to find the short term cash equivalent Assets, Other current Assets, Fixed assets, Noncurrent liabilities, current liabilities, derecognized amounts spent out of the business purposes.                                                                                                                   

Solutions

Expert Solution

The answer to the questions have been provided in the table below :

Cash Equivalent Assets are the total value of cash on hand that includes items that are similar to cash. Cash equivalents must be current assets. Amount (RO)
Bank Balance 148500
Treasury Bills 32650
Short Term Notes Receivable 32580
Money Market Funds 16580
Total Cash Equivalent 230310
Other current Assets is a category of things of value owned or used to generate income that can be converted into cash within one business cycle.
Furniture 22869
Total Other Current Assets 22869
Fixed Assets are purchased for long-term use and are not likely to be converted quickly into cash, such as land, buildings, and equipment
Machinery 42580
Total Fixed Assets 42580
Non-Current Liabilities are the obligations of the company which are expected to get paid after the period of one year
Loan 75800
Total Non Current Liabilities 75800
Current Liabilities are amounts due to be paid within 12 months
Amount payable to creditors 22580
Outstanding Expenses 17580
Salary payable to family members who are not employees of the business 2550
Total Current Liabilities 42710
Derecognized amounts spent out of the business purposes are those which are not for business
Money due to brother which borrowed for the personal expenses 4550
Total Derecognized amounts spent out of the business purposes 4550

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