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ACCA F7 June 2013 Question 2 Atlas

VIVA

ACCA F7 past exams lectures Download ACCA F7 Q&A


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Comments

  1. mohdafzal says

    May 11, 2018 at 8:20 am

    AHFS should be recorded at lower of CV and FV, then why is it recorded at 4,200. Shouldn’t it be recorded at 3,600?

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    • MikeLittle says

      May 11, 2018 at 12:38 pm

      It should, you are correct

      Thanks

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      • mohdafzal says

        May 12, 2018 at 6:52 am

        You’re welcome.

  2. calvinaw81 says

    February 24, 2017 at 5:12 pm

    Earning should not include other comprehensive income (eg revaluation gain) to derive EPS?

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    • MikeLittle says

      February 24, 2017 at 6:20 pm

      Profit after tax, after nci, after preference share entitlements

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  3. njivan28 says

    August 11, 2016 at 1:01 pm

    Hi Mike.Is this a nature or function method income statement?how do you know that?.Regards Njabulo

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    • MikeLittle says

      August 11, 2016 at 1:43 pm

      The (long-established) F7 examiner has always asked the same basis for cash flow questions to be prepared following the indirect method

      OK?

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  4. Suzana Atim says

    October 7, 2015 at 6:10 pm

    Thank you Mike but please be a little more audible. Am using Revision kit for Dec 15 sitting and it seems some of the questions are so edited ,cos some parts are not there like the share section. Plse advise me on what to do.

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    • MikeLittle says

      October 7, 2015 at 6:45 pm

      Hi Suzana

      I believe that I write the name of the question and the exam session at the start of those answers that are included within the revision lectures. With that information you should be able to download the actual question from the past exams that you can find on this website (or from the ACCA’s own website)

      And next time that I do any recording, I’ll try to be a bit more audible!

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  5. begmeygisele says

    May 14, 2015 at 8:30 am

    Hi Mike. Thanks for this good video. Can you please tell me if AHFS are recognised at fair value or lower of CV and FV. Thank you

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    • MikeLittle says

      May 14, 2015 at 9:34 am

      At fair value on initial recognition and at fair value thereafter

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      • MikeLittle says

        May 14, 2015 at 9:35 am

        Although there shouldn’t be much of a “thereafter” if the asset is going to be sold within 12 months

      • begmeygisele says

        May 14, 2015 at 10:17 am

        Now I’m really confused. The standards says another thing. In the exam kit they have not recognised the gain on the revaluation of 600. Please help I’m self-studying. Has someone forgotten to update somewhere in the books or standard? Thank you

      • MikeLittle says

        May 14, 2015 at 5:31 pm

        Post this on the Ask the Tutor page. I’ve no time to answer it just now and it will have disappeared from recent comments before I can get back to you

  6. seun says

    March 14, 2015 at 8:27 pm

    Please can you explain why the 10 million was subtracted from revenue and added to loan.
    And 7million added to inventory, 7million subtracted from cost of sales

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    • MikeLittle says

      March 14, 2015 at 8:48 pm

      Without looking at the question, this sounds like an example of sale and repurchase. It’s not really a sale – the company has the right (probably the obligation!) to buy the goods back at the end of a specified period of time.

      And if it’s not a genuine sale, then it should be removed from revenue and treated as a loan

      Ok?

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  7. nikhita says

    November 5, 2014 at 2:26 pm

    How did we get the figure 80 million shares, instead it should be 100000 shares ?(50000 x 0.50) ?

    Weighted average number of shares:
    1 April 2012 to 30 June 2012 80 million x $2·00/$1·84 x 3/12 = 21·7 million

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    • gazzi says

      November 5, 2014 at 7:18 pm

      nikkita

      if you divide 40000 shares by 50cents

      then u will get $80000 which is not the shares
      its the value of 40000shares…. did u get it……

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      • gazzi says

        November 6, 2014 at 9:51 am

        opps sorry
        ur ryt 40000 was the price and 80,000 is the shares

        apart from that every thing explained is fine

        just follow the steps u will get the answer straight n forward….

    • gazzi says

      November 5, 2014 at 7:28 pm

      if u see my first comment which i made it u will understand

      we have to calculate 40,000 shares which were at the start of the year( take it as 100 %)

      in the question we were given the
      opening share plus 25% shares right during the year which value was given in the question 50,000 shares

      now to go back to the opening shares

      we have to work back

      100/ 125 * 50,000 shares

      you will get 40000 shares

      so during the year the right was of 10,000 shares

      now sum it all up

      40,000 shares ( 100% ) start of the year

      10,000 shares (25%) during the year

      50,000 shares (125%) year end( which was given in the the question)

      just work back u will get the shares

      and the price of the price per share is 50cent

      ok nikki

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      • nikhita says

        November 6, 2014 at 8:10 am

        Yes I got it now. Thanks a lot gazzi. So for all such questions, whenever a rights issue is issued by the company , we should assume that these shares have also been added up in the Trial Balance?

    • MikeLittle says

      November 6, 2014 at 6:08 am

      That last two lines in your post look good to me.

      Do you understand it now?

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      • gazzi says

        November 6, 2014 at 9:35 am

        Where ever you need to calculate eps calculation you need to this calculation… and offcourse dear the trial balance given will definatly gives you the year end figure( but which may require some adjusments) i will read the whole question again and let you for sure.

        Key thing for passing this paper is understanding the logic and most important practice more n more….

      • gazzi says

        November 6, 2014 at 9:37 am

        mike your the best 🙂 thanks for the help in the last attempt….. thumbs up 🙂

  8. gazzi says

    June 1, 2014 at 1:15 pm

    there were 100% shares before rights issue

    then 25% ( 1/4) more shares added

    which makes 125% equals 50,000

    if u wana go to 100% percent

    100/125 or(1/5) * 50,000

    will give 40,000 shares

    i hope this makes sense

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  9. asma786 says

    May 1, 2014 at 10:00 am

    Thanks Mike now i got it.

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  10. asma786 says

    April 30, 2014 at 3:39 pm

    In the SOCIETY the 40,000/= of share capital

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  11. asma786 says

    April 30, 2014 at 3:36 pm

    Hi Mr Mike as per q share cap were $ 50,000 @ 50 cents note (v ) recorded a fully subscribed rights issue of 1 for 4 at $ 1.20 each how did you get the 40.000/=.
    I’m lost there.
    please help me out.

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  12. bennettdavey says

    November 21, 2013 at 2:59 pm

    I dont understand how u arrived at 80,000 shares and 20,000 shares in the EPS comp. or how you determined that 40,000 shares were issued at 1 April 2012.

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    • Renars says

      November 29, 2013 at 11:26 pm

      When calculating EPS 80,000 is the number of shares whereas when doing Statement of Changes in Equity the figure is 40,000 which is 80,000 shares at 50c each = $40,000. Then there’ s a rights issue of 1 for 4 which brings the shares from $40,000 / 80,000 shares to $50,000 / 100,000 shares.
      I trust this makes sense

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      • Amanah Saeed says

        April 26, 2014 at 2:09 pm

        Iam sorry but it didnt make any sense to me at all. i just cant get it. can somebody explains to me the adjustment that has been been made to the fully recorded right issue when it effected the change in equity statement.

      • MikeLittle says

        May 1, 2014 at 5:11 am

        If you start with 40 and have a 1 for 4, how many do you finish up with?

        Same question but backwards …. if you have 50 but that’s after a 1 for 4, how any did you start with?

  13. hks87 says

    June 25, 2013 at 12:23 am

    First of all Thank you Mike for Your solution. I got all the adjustments right 🙂

    I have question regarding “Revaluation of Asset held for sale”. In exam I also revalued plant held for sale (after charging 6 month depreciation) and transferred surplus to Revaluation A/C.

    But when I came out of examination hall I suddenly remembered that according to IFRS 5 standard, Immediately before the initial classification of the asset as held for sale, the carrying amount of the asset will be measured in accordance with applicable IFRSs and after classification, asset is measure at lower of its carrying value and FV less costs of disposal”. But in exam question Atlas is not following revaluating model for its Plant.

    I am still confused. Am I missing something? Please! Guide me.

    Thank you
    Haris.

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