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Hi John,
For this question, what would the adjustment be? I thought it would be removed from Trade payables but still within Current Liabilities as it is now due for repayment.
So essentially no change in net assets?
The question was:
In reconciling the receivables ledger control account with the list of receivable ledger balances of SK, the following errors were found:
1) the sales day book had been overcast by $370
2) a total of $940 from the cash receipts book has been recorded in the receivables ledger control account as $490What adjustments must be made to correct the errors?
A) credit sales control account 820. Decrease total of receivables ledger balance by 820
B) credit sales control account 820. No change of receivables ledger balance
C) debit sales control account 80. No change of receivables ledger balance
D) debit sales control account 80. Increase total of receivables ledger balance by 80Hi John,
I know the ruling IAS 2, but what I don’t understand with this question is the business would incur extra costs for these items to sit in inventory, would this then not increase the cost to 4000+2500=6500
As we need to take the lower of cost and NRV it would accounted we would include these items at £6000?
I’m not sure why we would do 4000-3500?
Thank you
Oh I see, there’s so many + and – I think my brain had gotten confused.
Thank you =)
All clear now
Hi baobaohui521,
Apologies I know this is not related to your question, however unsure of how else to connect. I am also studying the FA paper and wanted to know if you would like to be study buddies?
My email address is sbam11091@gmail.com, I plan to sit the exam next week no and it would be great to bounce ideas off another student
Thanks for the response Sacca, what a shame (for me ?). Congrats on passing =)
All the best
I just wanted to thank you Mike, I have seen in the more recent posts that you have tried to assist with getting in contact with Sacca. Sincerely appreciate your efforts, understanding and motivating response above.
Hi John,
Thank you for the above answer, I have read the notes and watched your videos on accruals and prepayments. I got the above wrong and hoped you could clarify the below please:
During September, the outstanding fuel bill was paid, plus further bills of $245.
1) I read the 245 as further bills paid? But when paying invoices the double entry doesn’t hit the p/l, so dr trade pay cr bank. It also doesn’t state what months it related to, adding to the confusion. I wonder if the dr for the 245 is the initial entry of the invoice cr trade pay dr p/l and that is what you have taken above with the 120.
I got the 20 for prepayment =) thankfully
2) Also to confirm, that 95 accrual I ignored, usually when I put through accruals they’re reversing journals the next month. Since this accrual was put in but then paid within the same month I assume they reversed this and that’s why the nil impact is ignored here.
Hope that all makes sense
Hi John,
I just wanted to say thank you for answering this question in such depth. I can’t tell you how long I’ve been trying to understand it, looking at your notes online, videos, then other videos and…. Nothing. Couldn’t get it.
It bizarre as I understand the accrued exp and prepaid expenses just fine. But the income aspect has me completely baffled.
I can at least now try and apply your method onto other questions, fingers crossed I can, otherwise I’m sure you’ll see a question pop up in the forum.
Much appreciated
I also posted to one member on the Ask the Tutor FA forum but I can’t see that anyone can respond in that thread.
I messaged Sacca here as they have posted as recently rather than an old thread if that makes sense.
Again, I apologise for any offence if taken, not my intention
Hi Mike,
Thanks for your message.
I made a post to the FA forum but not sure the general forum really gets seen as most come to the Ask the Tutor page.
I honestly mean no offence by posting here, I’m just not sure how else to connect with likeminded students when studying alone.
I’ve had study partners in the past which was extremely useful and thought for FA it would be great to connect with someone in the same boat.
Thank you
Hi Sacca22,
Apologies, I know this is not the forum for this question but I’m not sure how else to connect. I have seen your posts on the FA forum and they were the same questions I had. I wondered if you were still sitting the FA exam and wanted to be study buddies?
Thank you
Hi Joanne,
Apologies I know this is not the forum for this question, however unsure of how else to connect. I am also studying the FA paper and wanted to know if you would like to be study buddies?
I have posted on the FA forum within opentuition, please reply here or there and hopefully we can connect.
Apologies again, I know this is not the space for that, I am studying alone and it is very helpful to bounce queries off another student
Hi Sacca22,
Apologies, I know this is not the forum for this question but I’m not sure how else to connect. I have seen your posts on the FA forum and they were the same questions I had. I wondered if you were still sitting the FA exam and wanted to be study buddies?
Thank you
Also – follow up question:
What do they mean in the answer where it says ‘the refinancing provides reassurance to the bank about gearing levels and a higher rate of interest’?
Thank you
Hi John,
Just as a follow up question, could you kindly let me know when they mention pre tax earnings in the question, how do we know they have already deducted interest from that. I know from reading many of your answers that we can state our assumption and carry on but I wanted to understand how I could interpret that from the question when reading.
Much appreciated
Oh wow. Thank you John.
I’ve actually asked students and they’ve said it’s shares they already have. And that too was my assumption. I’m going to read through questions with that perspective and hopefully I get it. Or else I’ll be back =D
Thank you! Your turnaround response is so helpful, really appreciate it
