Q.1. Briefly distinguish financial accounting from managerial accounting.
Q.2. There are 5 users of financial information, describe any 4 of these users in detail
Q.3. Elaborate on the roles and responsibilities of management and independent auditors in the financial reporting process.
Q.4. Donald quit his job, being thoroughly frustrated at working hard as a production manager in a large automobile factory for a modest salary, while his relatively idle bosses seemed to be reaping all the financial rewards. He withdrew the bulk of his life’s savings and commenced a business retailing widgets, a product which everyone seemed to need. He registered a business named Donaldson (Pty) Ltd.
A summary of Donaldson (Pty) Ltd transactions for September 2021, first month of trading, appear below. Value Added Tax (VAT) has been ignored at this stage in order to focus on the recording procedure.
1. Jacob invested R150 000 in exchange of 100 shares of R1 each to the Donaldson (Pty) Ltd. The money was deposited into a bank account in the name of the company.
2. Negotiated an 18% load of R100 000 from Ubuntu Bank.
3. Purchased equipment for cash R72 000.
4. Sold widgets with a cost of R37 000 for R50 000 cash.
5. Paid himself and his assistant their salaries for the month R6 400 each.
Required:
Record the effect of the above transactions as they would appear in the accounting equation for Donaldson (Pty) Ltd. Please use this format to answer this question.
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Transaction description
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Assets
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Shareholders’ Equity
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Liabilities
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Debit
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Credit
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Debit
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Credit
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Debit
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Credit
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