OpenTuition.com Free resources for accountancy students
Free ACCA lectures and course notes | ACCA AAT FIA resources and forums | ACCA Global Community
in the exam is it allowed to start with the workings on the first page, then the full statement after?
I cannot see how else you could do it!
Yes, that’s fine
Hello Mike and anyone else able to help; on example 2 on p. 51 (Signe and Petras), it says the retained earnings for Signe is 0 as it’s not had time to make earnings yet. I understand this idea, but the accompanying balance sheet in the notes indicates retained earnings of $150 000 which I find confusing; how is the retained earnings zero but $150 000 on Signe’s books?
Hey Monica, it seems as though Signe made a profit of $150,000 during the year ended 31 dec 2009. Ie profit in its first year of trading.
Hello Mike and anyone else able to help; on example 2 on p. 51 (Signe and Petras), your workings indicate that the retained earnings for Signe is 0 as it’s not had time to make profits yet. I understand this idea, but the accompanying balance sheet in the notes indicates retained earnings of $150 000 which I find confusing; how is the retained earnings zero but $150 000 on Signe’s books?
Many thanks in advance for your help!
For working W2, Goodwill, Signe had achieved NO retained earnings because the acquisition was on the date of Signe’s incorporation. Some time later, as at the date when the consolidation is to be prepared, Signe has accumulated $150,000
sir, in the notes it is written that when an inventory is sold at a profit within the group, “we should calculate the unrealised profit included in inventory and note the adjustments to inventory and retained earnings on the face of the question paper. BOTH SIDES OF THE ADJUSTMENT should be must be made to the entity which has recognised this unrealised profit i:e the selling entity”
my question is why BOTH sides of the adjustments should be made to the selling entiy?….the selling entity does no longer have that particular inventory in his books, so why we would reduce something which is not their at all in the first place….after the sale has occurred, the inventory will be in the buyers book, and the buyer is the one who would have overvalued his inventory, so should’nt we reduce the amount in the buyers account.?……….
Mike, your lectures are fantastic. I was completing this course using only bpp textbooks up until now, and the F7 paper made me want to quit. Luckily I found this site and using your lectures it is really starting to make sense and now I will “always, only, ever” try and convince other students that they need to join this site. Thank you so much!!
That’s the way! And good luck with your exams
Do you cover Deferred Consideration, investments using Share Capital and Associates in the CSOFP lectures?
Thanks (good lectures by the way)
Not on recorded lectures – but there are 7 mini-exercises at the back of the course notes for you to practice on – and it’s really likely that this will feature in the December 2013 F7 exam
Hello, My question is : Why is it that when calculating the NCI Interest for the balance sheet, we use the figure for R.E. which has been adjusted for Intra – group pup? As the NCI is not part of the group will their share of the R.E. be the full amount (150 in this example as opposed to the 138). Just as we do not include them in any bargain purchases.
pls tell again how come we know there is no g/will?
I need a chapter and page reference if I’m to answer this!
And the name of the characters in the question
Thanks Mike Little!
hello, S sold goods to P for 60,000, the current asset of P increases by 60 but wouldn’t there also be either an increase in payables or a decrease in cash?
Yes – so what is your question?
Well I’m seeing the increase in the current asset but I’m not seeing the decrease in cash nor increase in payables.
Are these “goods in transit” or did the transaction take place during the year?
Excellent Lectures!!! Thank You Mr Little.
If i dont do an adjustment of PuP in the Consolidated R.E but I do it on the face of the question (adjusting calculated R.E with the PuP) I still balance the question except that I have slightly different figures for NCI and Retained earnings!!! would i still be awarded marks for such dealing??
Mr. Little I am currently doing the goodwill mini exercises on pg189. Part (b) of Q#1 – the NCI valuation in the answer is $384,000. I worked out 30% of $1,200,000 (FV of NA at DOA) and got $360,000. Can you explain how you arrived at this figure please?
Mr. Little I’ve just worked it out. I was working out the proportionate share which is part (c), instead of taking the NCI % of the total shares multiply by the share price.
No Doubt OT is Best !!! And the teacher like Mr.Mike are really Good!
But the only thing is i can’t find the Lecture on Preparation of Company’s Financial Statements..! The reason being these are taught at f3 or what ? plz commet
Oh dear, it has been a rather long night. lol
With regards to W3, why is it that the pre acquisition profit for the sub is 0? Why do we not deduct the entire 138?
I’m asking because above in W2, the FV of SNA@DOA, retained earnings were carried as 0, meaning that there were none @ DOA, so all RE would be Pre acquisition.
Am I going about this right?
In short, why is the 138 not deducted ftom the sub in W3?
@marcp, You’ve just said that in W2 the retained earnings were zero. If that’s the case, then surely all the retained earnings are POST ACQUISITION!
so if you reduce the value of the inventory, that would INCREASE the cost of sales and therefore reduce the profit
Technically, the double entry will involve reducing the value of closing inventory both on the balance sheet and within the cost of sales. So Debit Cost of Sales 12,000 in the Statement of Income and Credit Closing Inventory on the Balance Sheet.
The first part of the entry reduces profits ( because costs have increased ) and the second part balances the fall in profits by reducing the assets on the balance sheet
because the inventory is over valued by that amount.
hello sir if the S sell to P…. i understand he makes an unrealised profit of 12000. why does he have to reduce inventory as well???
You must be logged in to post a comment.
ACCA F1 /FIA FAB Dec 2013 Exam was...
F5 Dec 2013 Exam was... Post comments
F6 Dec 2013 Exam was... Post comments
F7 Dec 2013 Exam was... Post comments
F8 Dec 2013 Exam was... Post comments
F9 Dec 2013 Exam was... Post comments
P4 Dec 2013 Exam was... Post comments
P5 Dec 2013 Exam was... Post comments
P6 Dec 2013 Exam was... Post comments
P7 Dec 2013 Exam was... Post comments
FIA MA1 exam was...
FIA FA2 exam was...
FIA MA2 exam was...
FIA FTX Exam was...
FIA FFM exam was...
Return to top of page
Copyright © 2013 · Privacy and Cookies · Advertising · Contact us · Sitemap · Log in