Viola Ltd sells inventory worth $4,500 for $7,000 on credit.

What entries are recorded in the accounting information systems of Viola Ltd?

Harding Ltd borrowed $150,000 from Cheng Bank.

Record the entry that Harding Ltd would make to record this at the commencement of the loan.

Trotman Ltd owes $6,500 in wages at the end of the month.

How should this be recorded in Trotman Ltd's accounting information system?

Ang Limited paid three months of rent for $36,000. Two of these months were paid in advance and one month was paid for the current month's rental expense.

How would Ang Ltd record this in their accounting information system?

Ang Ltd receives $65,000 from accounts receivable for sales in previous months.

How would Ang record the transaction in their accounting information system?

Chang Ltd purchased $90,000 of inventory on credit.

What are the journal entries that will be entered in the accounting information system of Chang Ltd?

Question 5 Part C. 

A new employee in BBB’s finance department argues that using the direct write-off method is better than the allowance method for accounting for bad debts. Do you agree or disagree? Provide TWO reasons to support your answer. (2 marks)

Question 5 Part A. 

Prepare the EQUITY section of the balance sheet for BBB Ltd as at 30 June 2025. (2 marks)

Question 5 Part B. 

Redo part a assuming the additional transactions:

• The company issued 2,000 new shares at a price of $2 each during year ended 30 June 2025
• On 20 June 2025, a customer went bankrupt and the company decided to write off $20,000 outstanding balance in this customer’s account.

 (2 marks)