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For the capital allowances in question 4. What did everyone do for the van, put it in the main pool for WDA or AIA?
Yeah same as me I believe.
As at the start I was increasing cash and also increasing the liability (deferred income) by 8.5.
Then unwound so by the end the liability of deferred income was 9.55 due to the finance costs over 2 years and then got debited and then revenue credited 9.55 when control passed to the customer.
For the cash flows question, my 5 workings were PPE, Investment in Associate, Investment Income, NCI and Intangible Assets. Then just got the b/f and c/f figures from the SOFP and added all the figures in from the SOPL and also the dialogue of the question. Then the balancing figures were cash inflows or outfows.
Then the acquisition of the sub was the answer for cash paid from question 1 minus the cash the subsidiary held already.
There was also an increase in share capital of 3000 (cash inflow)
Sale of the investment asset (4500 outflow)
Purchase of associate (5000 outflow)
Anyone else with similar workings?
I got a cash figure of 4 when it balanced, with a profit on revaluation of the previously held interest of 0.4.
This includes the upwards revaluation of land at 0.6 added to the NA of the sub.
for this I did
DR: Cash 8.5
CR liability 8.5Then added the finance charge to increase the liability over 2 years so it ended as 9.55 before being transferred to the customer.
DR liability 9.55
CR Revenue 9.55Surely if the formula for cos is opening inventory + purchases – closing inventory then a overstatement of closing inventory would reduce it therefore increasing cos? Also, If the investment property got revalued from 20,000 to 22,000 isn’t that a 2000 addition to the p and l for fv gain? Did everything else the same as you though. What were your answers for the SOCIE?
Yeah I got 15,000 for share capital, and 37,500 for share premium. I only put the gain in the statement of profit or loss as it was an investment property held at fair value. Then I took the 3000 dividend out of retained earnings.
I got a loss as well, I believe that’s correct though. My workings were add back the inventory into cost of sales. Then, minus deprecation as it was an investment property at fair value, then add the 2000 gain to p and l. Then I added the provision to admin expenses. I took out the 3000 dividend from admin expenses and took it out in the statement of changes in equity. Added 1300 to admin for the spend on internally generated brand and another 100 for amortisation on the brand they bought. Lastly, I ended up with a tax refund of 560. my total loss was around the 10,000 mark. Was yours similar? Overall, quite a hard exam I thought compared to past papers.
