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    • I assume that you actually mean question 3 🙂

      The answer does not divide anything by 840 !! (And you would realise this if you checked the total for withdrawals of 12,360)

      If you look carefully, the total drawings are (960 x 12) + 840.

      (960 is multiplied by 12 (not 11) because there are 12 months in the year, and then 840 is added because of the inventory taken).

  3. Sir, l need clarification regarding the explanation to the answering of question 3 of 5 of the FA chapter 2. The question was net asset as at February 1st and not January 1st , hence the withdrawals should be for 11 months i.e. 11 x $ 960 and not 12 x $960 please help clarify.

  5. I’m new to accounts..my teacher told me to study through this and I’m doing edexcel as(1st stage) do you have the basic accounts materials here..plz reply me if you have and send the link too

    • In future please ask this kind of question in the Ask the Tutor Forum – not as a comment on a practice test.

      We provide free study material for the ACCA and CIMA examinations. ACCA Paper FA is basic accounting and applies to any exams.
      You can find out material by following the links to ACCA and then FA at the top of the page.

    • We have an online mock exam that is linked from the main Paper F3 page. However, you need more than 1 mock exam – you must buy a Revision Kit from one of the ACCA approved publishers. The Revision Kit contains mock exams, and also lots of exam-standard questions for practice (and practice is vital to passing the exam).

  10. Morning, Sir.
    Regarding F3 Chapter 2 Questions 5 of 5,

    Q: On 1 July 2012 a business had net assets of $23,000.
    At 30 June 2013 they had total assets of $34,000 and total liabilities of $8,000.
    During the year the owner had introduced $2,000 more capital, and had taken drawings of $500 per month.
    What was the profit for the year ended 30 Jun 2013?

    I would like to ask sir, how to solve this question.
    Thanks.

  11. hi sir
    i would like to ask you a personal question
    that is, practicing more questions in open tuition and also practicing its mock exams several times
    could it help and support me to pass for sitting my f2 paper next week
    with high marks like 80 or 70 and above
    otherwise we found this site very helpful and thank you
    for being available eveytime

    • In future, please ask this sort of question in the Ask the Tutor Forum rather than as a comment on a test.

      The more practice you get the better – there is also a practice exam on the ACCA website, and best of all is to use a Revision Kit from one of the ACCA approved publishers because they are full of practice questions.

  14. Hello, I don’t understand the reasoning behind the solution of Question 1 and Question 3.

    In Question – 1 : The correct answer had ‘Capital Introduced’ subtracted while the ‘Drawings’ were added, shouldn’t it be the other way around with drawings being subtracted and capital introduced treated as an addition ?

    In Question – 3 : I did everything correctly but I subtracted Drawings ( Less : Withdrawal ) while the correct answer had (Add : Withdrawals). Isn’t Drawings something that owner withdraws from the business ? Then why isn’t it treated as a subtraction ?

    • The pop-up answers to both questions are correct.

      they are both applications of the accounting equation: increase in net assets = capital introduced plus profit less drawings.

      This is explained in full in the free lectures, and you should watch the lectures before attempting the tests. The lectures are a complete free course for Paper F3 and cover everything needed to be able to pass the exam well.

  15. I really feel regret that I didn’t know about this website earlier. I got to know about this website just a couple of weeks earlier from our management. Besides, I don’t have any basics on accounting and also I couldn’t understand my class lecturer. But now I just went through this two chapters and now on wards I’m feeling confident that I can do this exam better. All the credit goes to you Sir! Thank you for that.

    • This is a wonderful site to help students. A lot of time is required to find and read the notes and download the lectures.

      I have the following suggestions:
      a. both readers and tutor time will be saved if the Lecture Notes and Lecture Videos can be downloaded by pressing a button
      b. the other interactive parts can be left as they are, e.g. the Mock Exam Questions, Quiz, etc.

      • There is a button for downloading the notes above each lecture, and they obviously only need downloading once.
        Lectures cannot be downloaded – they can only be watched online. That is the only way that we can keep this website free of charge. (You will find the same applies on paid for websites also)

    • No – there is no ambiguity.
      He withdraws 980 per month. We are looking at the period from 1 February 2007 to 31 January 2008, which is 12 months.
      Unless the question said differently, you would assume it was 980 for each of the 12 months.
      (This was actually a past exam question)

    • If you click on F3 on the bar at the top of this page (underneath the red bar) then you will get a page listing all of our free resources for Paper F3.

      If you scroll down the page you will find a button saying “View all F3 lectures” – if you click on it then you will get a page listing all of the lectures, including those for this chapter.

      (The lectures are a complete free course for Paper F3 and cover everything needed to be able to pass the exam well.)

  21. I don’t understand question 1. For example – OB – 10, Drawing – 5, Capital introduced – 10 and CB (obviously) – 15. If we use the formula above 15-5+10-10 = 0 but that’s not true because net profit = 10-5 e.g 5

    • Have you watched the free lectures for this chapter of our lecture notes? (My lectures are a complete free course for Paper F3 and cover everything needed to be able to pass the exam well.)

      This is testing you on the accounting equation.

      Increase in net assets = capital introduced + profit – drawings
      The net assets at the end of the year are 34,000 – 8,000 = 26,000. Therefore the increase in net assets = 26,000 – 23,000 = 3,000.

      Therefore, using the accounting equation:
      3,000 = 2,000 + profit – (12 x 500) = 2,000 + profit – 6,000 = profit – 4,000
      Therefore profit = 3,000 + 4,000 = 7,000

    • No.

      For a sole trader, the retained earnings at the start of the year are part of the total capital at the start of the year (retained earnings for a sole trader are not show separately).
      For a limited company (which is dealt with in later chapters) the retained earnings at the start of the year (together with the share capital and other reserves) are always equal to the net assets at the start of the year.

      In either case, the change in the net assets over the year is only ever equal to any capital introduced during the year plus the profit for the year less the drawings for the year (or in the case of limited companies, the dividends paid in the year).

    • The ACCA does not release past exams, so I cannot give you a link.

      Assuming that you have a Revision Kit from one of the approved publishers (as we recommend), then you will have more than enough exam standard questions to practice 🙂

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