Additional memory 95
Total to be capitalised = 1,015
If the purchaser is registered for sales tax, the sales tax is not capitalised.
If the purchaser is not registered for…[Read more]
Profit on disposal – 40,000
Increase in inventories -130,000
Decrease in receivables +100,000
Increase in payables +80,000
Correct answer is an addition to operating profit of $990,000.
The 2010 estimate of $230,000 turns out to be an over-provision by $8,000.
This over-provision of $8,000 is credited to profit or loss in 2011.
The estimated tax charge for 2011 is 265,000. It is debited to profit or loss.
So, for 2011, the net expense to profit or loss is 265,000 – 8,000 = 257,000.
The SOFP at end of 2011 includes only the…[Read more]
In relation to the example on the internet that you found, the numbers as presented just don’t add up to the net profit figure included.
In relation to the ‘Incl errors’ column:
Admin ( 25)
Deprec ( 15)
Stationery ( 10)
Net profit is 110, not 120 as you have shown above.
The net profit is understated by £50,000 because the only error affecting the net profit is the incorrect inclusion of the capital expenditure in purchases.
Whereas it was incorrect to include the inventory of stationery in the gross profit calculation (hence the understatement of gross profit by £40,000), it is not incorrect to include the…[Read more]
This question required understanding of the accounting equation as follows:
assets = liabilities + equity
=> noncurrent assets (NCA) + current assets (CA) = noncurrent liabilities (NCL) +current liabilities + share capital (SC) + retained earnings (RE)
=> NCA + bank + other CA = NCL + CL + SC + RE
=> NCA + bank +(other CA – CL) = NCL + SC +…[Read more]
I have developed a web application that generates practise questions and solutions in teachers and students of accounting and finance. I have modified past exam ACCA F3 questions for use with the application. They can be downloaded for free at:
Points to note:
The questions have been modified…[Read more]
I have developed a web application that generates practise questions and solutions to assist teachers and students of accounting and finance. I have modified past exam ACCA F7 questions for use with the application. They can be downloaded for free at:
Points to note:
The questions have been…[Read more]