Discuss the three primary methods used by Guaranty Fund to assess property and liability insurance using your own words.

College of Administrative and Financial Sciences

Assignment 3

Deadline: 27/11/2021@ 23:59

Course Name: Insurance Accounting	Student’s Name:
Course Code: ACCT 424	Student’s ID Number:
Semester: 1	CRN:
Academic Year: 1443/1442 H

For Instructor’s Use only

Instructor’s Name: Habiba Moabber
Students’ Grade: Marks Obtained/Out of 5	Level of Marks: High/Middle/Low

Instructions – PLEASE READ THEM CAREFULLY

The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.
Assignments submitted through email will not be accepted.
Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling your information on the cover page.
Students must mention question number clearly in their answer.
Late submission will NOT be accepted.
Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).
Submissions without this cover page will NOT be accepted.

Assignment Question(s):

Q1. The following financial transactions are related with a General Takaful Product:

i. An amount of SAR 6,200 received as advanced contribution from new participants.

ii. An amount of SAR 4,500 received as a contribution from new participants.

iii. Contribution renewal received from participants SAR 5,500.

You are required to prepare necessary journal entries. (1.5 Marks)

Answer:

Q2. Discuss the three primary methods used by Guaranty Fund to assess property and liability insurance using your own words. (2 Marks)

Answer:

Q3. XYZ Company has the following financial data: (1.5 marks)

Particulars	Amounts (SAR)
Total Profit for the Year	377,500
General Takaful Assets (Year 2014)	1,390,000
General Takaful Assets (Year 2015)	1,517,500
Cash	11,500
Short-term Investment	23,500
Short term liabilities	85,000
Underwriting Surplus Distributable to Participants/Participants’ Share of Profit	145,500
Gross Contribution	958,000
Net Contribution	662,500
Wakalah Fee	77,500
Commission Paid	28,300
Management Expense	58,000
Net Claim Incurred	287,500
Earned Contribution	632,500

You are required to calculate:

Answer: