[Harjotrkk]

Dee and Eff are major shareholders in, and the directors of, the public company, Fan plc. For the year ended 30 April 20X5 Fan plc’s financial statements showed a loss of £2,000 for the year.

For the year ended 30 April 20X6 Fan plc made a profit of £3,000 and, due to a revaluation, the value of its land and buildings increased by £5,000.

Question
Task 1

Which of the following statements describe the profits available for distribution by a public limited company?

A.Accumulated realised profits
B.Accumulated realised and unrealised profits less accumulated unrealised losses
C.Net realised profits
D.Net realised profits less net unrealised losses

Hi Mike

For this question I’ve answered C but the mark scheme suggests D

I don’t understand why, could you please explain it to me

[Harjotrkk]

Yes it is

Both questions were well explained

Thanks Mike!

[Harjotrkk]

In January, Ami took over an old warehouse with the intention of opening an art gallery. As the warehouse had to be converted, Ami entered into a contract with Cis to do all the necessary painting. Cis was to be paid £5,000. Cis received an initial payment of £1,000 and agreed to have the work completed by 31 March.

At the end of February, Cis told Ami that she would not complete the work in time unless Ami agreed to increase her payment by a further £1,000. Ami agreed to ensure that the job was done on time.

On completion of the work on time, Ami refused to make the additional payment to Cis, beyond the original contractual price.

Question
Task 2

Indicate which, of the following are past consideration and which are not.

Past consideration / Not past consideration – Ami’s initial payment of £1,000
Past consideration / Not past consideration – Cis’s initial agreement to complete the work by 31 March
Past consideration / Not past consideration – The work that had been done by Cis at the end of February
Past consideration / Not past consideration – Ami’s agreement to pay the further £1,000

Hi Mike

I need some help understanding the meaning of past consideration.

Could you please explain to me which of these are past consideration and which of these are not. Thanks.

[Harjotrkk]

Yes

Thanks Mike

[Harjotrkk]

Yes much better

Thanks Mike

[Harjotrkk]

Which of the following may be arranged under “pre-pack” administration?

(1) Potential buyers for the sale of the company

(2) A sale price for the business

A.1 only
B.2 only
C.Neither 1 nor 2
D.Both 1 and 2

Hi Mike

For this question I answered D but the mark scheme suggests A and explains that A pre-packaged administration (“pre-pack”) sale is a pre-arranged sale of a business and its assets (not the company) on the commencement of administration.

Can you please explain what is the difference between selling a business and its assets VS selling a company?

[Harjotrkk]

I understand what you mean in the first paragraph of your explanation but not the 2nd paragraph.

Could you please explain it again?

[Harjotrkk]

I see how the answer can change in different situations

Thanks Mike

[Harjotrkk]

Fantastic

Thanks Mike!

[Harjotrkk]

Yes very good!

Thank you Mike

Also just want to confirm that the video lectures are valid for exams in the December 2025 sitting?

[Harjotrkk]

Hi Mike.

I wanted to ask how do you know what is ‘the correct minimum period of notice an employee is entitled to’, when the question gives you how long they have provided service for?

[Author]

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