M1 Finance 2016/2017

UE 5 - Financial Controlling
Assignment #1
Submission Deadline: September 28th, 2016 (23:59)
Exercise 1. Users of accounting information
1. Choose three users of accounting information and suggest the information that each is
likely to need from accounting statements and reports
2. Rank the different users of accounting information in order of the priority that you
think should be given to their needs
3. Compare your answer with the answers of other students and try to explore likely
causes of any major differences that emerge

Exercise 2. Accounting principles

Mention what accounting principle is involved by the following situations and give the
basic idea of this accounting principle.
1. The company acquired 100 shares X at 30 euros and 100 shares Y at 36 euros. The
average price for the last month of the fiscal year is 34 euros for shares X and 32 euros
for shares Y. Should the company increase the accounting value of shares X? Should
the company decrease the accounting value of shares Y?
2. Although the material is not used more intensively, the company wants to change the
method of calculation of the corresponding depreciation. Is it possible?
3. In 2014, the company has signed a long-term contract whose implementation will last
more than 12 months. At the end of the year, a potential profit already appears. What
is the impact for financial statements?
4. The company uses accounting methods that were recommended to it by the accountant
of the company, but these methods are not allowed anymore. Is it possible to change
the method and if so, under what conditions?
5. The company has recorded a lot of expenses at the end of the year. Some of these
charges concern the fiscal year just ended and others concern the following year.
Which accounting principle refers to this situation?

M1 Finance 2016/2017
Exercise 3. Recognizing accounting transactions
The following information relates to enterprise Borntomake Accounting for the year 2013:
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01/15: Goods were purchased for 4,000 (cash purchase 2,000, credit purchase
2,000, payment in two months)
01/31: Loan of 8,000 with an annually repayment of 1,000 over 8 years at the end of
each year.
02/02: Goods were sold for 20,000 (cash sales 10,000, credit sales 10,000,
payment in four months).
15/03: Payment of the balance of the purchase invoice (2,000).
06/02: Reception of the payment of the balance of the sales invoice (10,000)
07/04: Purchase of a truck for 15,000 euros by cash.
11/20: Receipt of an order from a customer for 1,500 euros. The invoice has not been
issued yet.
12/31: Repayment of the bank loan for 1,000

At the beginning of the year, we have the following information:

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Cash = 5,000
Loan = 5,000

Question
Mention for each transactions:
-

The accounting account concerned (assets/liabilities/income/expenses).

If this accounting account have to be credited or debited
And the financial statements impacted by these transactions