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June 28, 2020 at 10:07 pm
July 12, 2019 at 8:01 pm
how finace cost in sopl is credit in t account of intrest payable ? usualy expense is debit balance right ?
August 16, 2019 at 3:19 am
Interest expense is debited in income statement and it also increases the liability so that’s why there’s a credit in interest payable account. Journal entry: Expense- debit(SPL) Interest payable- credit.(SOFP)
June 5, 2020 at 9:08 pm
I believe it’s Finance cost is put on Credit side to follow credit opening balance of Interest payable.
I look at it this way: Interest payable Opening (SPF PY): (100) Finance cost paid (SPL CY): (50) Interest paid in cash (SCF CY): ??? Interest payable Closing (SPF CY): (20)
So using this Dr-Cr table we have: -100 – 50 = -150 PLUS 20 (since Interest payble Closing is on the Dr side) = -130
The idea is I had 100$ liability at PY (from SFP) , also I’ve accrued 50$ more during this year (SPL), and at the end of CY year I have only 20$ (SFP). So if I owed 150$ but now I only owe 20$, this means I’ve repaid 130$ (cash outflow)
December 1, 2018 at 10:51 am
How come we have to reduce the profit and add the loss on the disposal of the PPE? What is the logic behind it?
March 4, 2019 at 5:02 pm
the profit or loss on disposal is basically an assumption, since the depreciating element used in arriving the profit or loss. Since the initial adjustment in the SOPL was to add the profit on disposal to the PBT, we have to deduct it from the PBT in the Statement of Cash Flow in order to get the actual profit.
May 18, 2019 at 8:09 pm
i just have a simple understanding that gain increases income and loss reduces income; therefore, in order to see the actual cash flow, we would remove the gain or add back the loss since they are non cash items.
January 13, 2020 at 4:13 pm
you are right.
November 19, 2018 at 7:23 am
There must be a missing video about the ‘statement of changes in equity’ part. In the note, there is a separate page about SOCE and Chris also mention that at the beginning of this vedio, but we didn’t see it either in this or the previous video. Please check it.
November 18, 2018 at 6:25 pm
video on Statement of Changes in Equity not present
September 19, 2018 at 4:09 am
Dear Opentuition I think there is a missing video related to Statement of change in Equity. as Mr. Chris mentioned at the end of his video
September 13, 2018 at 10:36 pm
Because they are items of cash outflows!
November 19, 2018 at 7:20 am
September 13, 2018 at 4:41 pm
interest paid and tax paid are cash items , why deduction on socf?
May 20, 2019 at 2:10 pm
They are payments in cash, and hence deductions given they will have reduced our cash figure.
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