Exercises:

Portal for students of economics and management

It is a limited liability company with a capital of 1,000,000 MAD fully paid; it specializes in manufacturing.
from a synthetic fabric intended for Moroccan crafts. It imports raw materials from abroad and
some accessories. To establish the accounting closing work of 2007; the files are being handed to you
following accountants:

1- Importation of raw materials

Facture n° 3725/f du 05/12/07 Invoice ODEP No. 37284 dated 24/12/07

Synthetic fibers 2xB: 52 800 Euros Unloading: 2,600 dirhams

Transport 2,200 Euros Freight 3,700 dirhams
Marine insurance 2,400 Euros VAT 20% 1,260 dirhams
TOTAL 57 400 Euros

To be paid by bank transfer on 30/12/2007 Paid by cheque no. 341: 7,570 dirhams

Customs Receipt dated 12/23/07 Bank debit notice dated 30/12/07

Customs duty : 10 560 dhs Currency purchase = 57,400 € x 9.2 dh = 528,080 dhs
Tax deduction: 52,800 AED Commissions and fees: 2,360 AED
VAT : 118,288 dirhams VAT 10% : 236 dirhams

Paid by check no. 431: 181,648 dirhams Paid by check no. 446: 530 676 dirhams
Euro exchange rate: 1 € = 9.26 dhs

Work to be done: Record the above documents

2- Transfer of fixed assets

Departure Cost Duration and Accumulation of Dates and prices of
Immobilization of love dead mode depreciation cession
t ab of depreciation s au
(HT) ent 31/12/2006
4 Trucks "Ford" 01/07/0 1,684,400 5 years L To be determined One of the 4 trucks
2 was ceded on 09/28/07 to
120,000
5 micro-ordin Bull 03/7/01 209,600 8 years D 193 373,92 A microphone a summer
sold on 27/10/07
counter check
banking of 2,000 dirhams
The VAT rate on the acquisitions of the fixed assets mentioned above is 20%

Work to be done: Enter the accounting entries related to the adjustment of the
transfer of transport equipment and computer equipment on the date of
31/12/2007 ?

3- Lease financing immobilization:

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Sultan Moulay Slimane University - FST of Beni Mellal - S5 - Advanced Accounting
Pro: Mr. HAMIA MOHAMED - Academic Year: 2008/2009 UniversitySMS.Com
 The company acquired a production machine through leasing. The 5-year contract covers the
following data :
Due date: from 30/06/2002 to 31/12/2002
End of deadlines (coincides with the exercise date of the purchase option): 30/06/2007
Depreciation period for the equipment: 10 years
Fixed semi-annual fee payable by bank: 13,100 dh (excluding tax)
- Indemnité de rachat : 75 000 dhs
The security deposit paid at the start of the contract is 10,000 dirhams.
Check for the balance payment

Work to be done: account for the operation related to the exercise of the purchase option of
material in question?

4- Fixed immobilization
A company purchases a machine tool on 28/04/2007 for a price of 540,000 MAD including tax (VAT at 20%).
The depreciation is 10%. The payment is as follows:
150,000 dirhams by bank upon delivery of the machine;
The remainder by bank in 2 equal installments on 31/12/2007 and 31/12/2008, These installments
will be indexed to inflation rates of 2% in 2007, 3% in 2008.

Work to do: Post the accounting entries for this operation on the date
acquisition of equipment and as of 31/12/2007

5- doubtful receivables
1- Doubtful former clients:
Doubtful clients Total amount including tax Provision 2006 Observations
For settlement; TAMA company has
SA 'TAMA' 15,360 3,200 was liquidated by the court
in October 2007. VAT 20%
Claim abandoned by
SARL "BOUKDAD" 2,940 1,225 the company on 12/31/07,
without none pursuit
judicial. VAT 20%

2- New questionable clients:

Two new clients with a total debt of 17,760 dirhams including tax are considered by management.
commercial as contentious; their depreciation is estimated flatly at 40%. VAT 20%.

Travail à Faire : Présenter les écritures comptables relatives à ce dossier

6- Charges and Products to be regularized

1- An insurance premium was recorded in October 2007 for a total amount of 4,200 dirhams; it
covers the risks for the period from 01/10/2007 to 31/03/2008;
2- A telephone bill from December 2007 was received in January 2008. Total including taxes is 3,888.
dhs;
3- The water and electricity bills for December 2007 did not arrive until January 2008. Total
TTC 6 206 dirhams (including VAT 635.54 dirhams);
4- Amounts due from suppliers not yet received as of 31/12/07 related to a discount of 4,080 Dhs including tax (VAT)
20%) ;
5- Amount owed to customers not yet established as of 31/12/07 regarding a commercial discount of 3,360
dhs TTC (VAT 20%).

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Sultan Moulay Slimane University - FST of Beni Mellal - S5 - Advanced Accounting
Pro: Mr. HAMIA MOHAMED - Academic year: 2008/2009 UniversitySMS.Com
Work to Do: Enter the accounting entries on 12/31/2007

CORRIGATE

1- Importation of raw materials

Accounting entries for the operation of purchasing goods from abroad:

25/12/2007
612101 Purchase of raw materials 531,524.00
(557 400 € * 9,26 dh)
612102 Import fees for materials 69,660.00
(2,600 + 3,700) + (10,500 + 52,800)
34552 State - VAT Recovery/Charges 119,548.00
1260 + 118 288
441102 Foreigners 531,524.00
5141 Bank 189,208.00
Invoice No. 3725
Note ODEP No. 37280
Customs receipt of 23/12/07
31/12/07
441102 Foreigners 531,524.00
6147 Banking facilities 2 360,00
34552 State - VAT recovered/expenses 236,00
Bank 530,676.00
Exchange gains 3,444.00
Debit notice No………….
Check no. ……………..

2- Disposal of fixed assets

Truck 'FORD': only 6 months of depreciation left:

1 truck transferred:
- Additional allocation of 6 months in 2007: (1,684,400/4) * 0.2 * 6/12 = 42,110
VNA of transferred and untransferred transport equipment is: 0 since the 4 trucks are fully depreciated.
in July 2007 (from July 2002 to June 2007)
Accumulated depreciation at the end of June 2007: 1,684,400

3 remaining trucks: depreciation allocation: (1684400/4)*3)*0.2*6/12=126330

Computer equipment: 5 "Bul" micro-computers

The provision for 2007 must be calculated linearly, there remains a depreciation period of 30 months.
which gives a linear rate of 40% (100/2.5 *100) higher than the declining rate of 37.5%

1 Microcomputer sold:

- Additional allocation of 2007: ((209,600/5) - (193,374.92 /5)) * 0.4 * 10/12 = 1,081.67

- Transfer of equipment value: 2,163.55 :((209,600-193,374.92)/5 – 1,081.672)
- Accumulated depreciation as of the end of June 2007: 39,756.45 (193,374.92/5 + 1,081.672)

4 remaining micro-computers:
- Depreciation allocation 2007: [(209,600/5)*4) - (193,374.92/5)*4)] * 40% = 5,192
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Sultan Moulay Slimane University - FST of Beni Mellal - S5 - Advanced Accounting
Pro: Mr. HAMIA MOHAMED - Academic Year: 2008/2009 UnversiteSMS.Com
 31/12/2007
6193 DEA of corporate real estate 174,713.67
2834 Amort from MT 168 440,00
28355 Amort M information 6,273.67
Additional and annual allocations
D°
2834 Amort of the MT 421 100.00
28355 Amort Mat Info 39 756,45
6513 VNA of real estate assets transferred (information material) 2,163.55
2340 Mat trans 421 100
2355 Mat infor 41 920
Regularization of transfers

Note: No repayment regarding the VAT recovered on disposed fixed assets.

since the duration of ownership of these two fixed assets exceeds the 5 years required by law.

3- Leasing immobilization:
30/06/2007
2332 Equipment and Tools 75,000
2486 Deposit and security 10,000
5141 Bank 65,000
31/12/007
6193 DEA of corporate real estate 3,750
28332 Amortization of Materials and Tools 3,750
75 000 * 10% * 6/12

4- Fixed immobilization
28/04/2007
2332 Material and Tools 450,000.00
34551 VAT/state/immovable 90,000.00
5141 Bank 150,000.00
1486 Real estate 390 000,00
31/12/2007
1486 Frs of immob 195,000.00
63118 Other interests of loans and debts 3,900.00
34552 VAT recoverable/charges 390.00
5141 Bank 199 290,00
d°
2720 Increased financing debts 3,900.00
1486 Fixed assets 3,900.00
Amount still to be paid in EUR is indexed at 2%: 195,000 * 1.02 = 198,900
So there is an increase in debt of: 198,900 - 190,000 = 3,900 dirhams
d°
6393 DP for financial risks and charges 3,900.00
1558 Propose for price increase 3,900.00
d°
6193 DEA of corporate real estate 45 000,00
28332 Dead of the Morning and Out 45,000.00
Amortization allocation: 450,000 * 10%
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Sultan Moulay Slimane University - FST of Beni Mellal - S5 - Advanced Accounting
Pro: Mr. HAMIA MOHAMED - Academic Year: 2008/2009 UnversiteSMS.Com
 5- doubtful receivables

31/12/2007
6182 Loss on uncollectible receivables 12 800,00
15360 divided by 1.2 equals 12800 ht

4455 State VAT due 2 560,00

3424 Dubious or contentious clients 15 360,00

TAMA company liquidated judicially

D°
6182 Loss on uncollectible receivables 2,940.00
(TVA is supported by the company)
4455 Questionable or contentious clients 2,940.00
Claim abandoned solely due to a management decision
that is why VAT will not be deducted from the invoiced VAT amount and will therefore be
supported as an expense by the company
D°
3942 PPD of accounts receivable and CR 4,425.00
7196 Reprise/Prov PD of AC 4,425.00
Cancellation of provisions for settled receivables
D°
3424 Doubtful or contentious clients 17 760,00
3421 Clients and CR 17 760,00
6196 DEPPD of the AC 5 920,00
3942 For the PD of the CCR 5 920,00
Dotation: (17760/1,2)*40%= 5920

6- Charges and Products to be regularized

31/12/2007
3491 Charges recognized in advance 2 100,00
6134 Insurance premium 2,100.00

6145 Post and telecom expenses 3,240.00

34552 VAT/charges to be paid 648.00
4487 Debts associated with other creditors 3,888.00

6125 Non-inventory purchases of materials and F 5,800.00

34552 VAT/charges to be paid 406.00
4487 Debts linked to other creditors 6 206,00

3417 RRR to obtain, not yet received 4 080,00

6129 RRR obtained on the purchase of m 1st 3,400.00
34552 VAT/character/product to be received 680.00
7129 RRR granted by the EN/SE on the sale of PF 2,800.00
4455 VAT invoiced on credit note to be issued 560.00
RRRO agreed to establish 3 360,00

5
Sultan Moulay Slimane University - FST of Beni Mellal - S5 - Advanced Accounting
Pro: Mr. HAMIA MOHAMED - Academic Year: 2008/2009 UniversitySMS.Com
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Sultan Moulay Slimane University - FST of Beni Mellal - S5 - Advanced Accounting
Pro: Mr. HAMIA MOHAMED - Academic Year: 2008/2009 UnversiteSMS.Com