[Tatia]

@piggy93 said:
I think you misunderstand the about provision? It is liability, not asset.

..and, the TOTAL PROVISION will be Sum of them… Correct yeah I understand. 🙁

[Tatia]

@piggy93 said:
Your concept is correct! When we purchase an asset and some environment cost will be incurred we will capitalise the environment cost
Example:
Year 0, Asset 500 Environment cost 100 incur in Year 2. Cost of capital 10%.
Dr Asset (500+100/1.1^2) 583
Cr Bank 500
Cr Provision 83

End of year 0,
Dr Finance cost (83*0.1) 8
Cr Provision 8

Sooo..?

What do you think, B or C?

[Tatia]

@riskyguy said:
You know what, maybe I’ll do question 2/3 and share them here. Don’t even want to see Q1 again.

Unfortunately, I have not even touchd to Q1 😀

Also time was out.

[Tatia]

I read the question 17 again and again and it says provision in its SOFP.

If we consider that finance costs appears in PL, we had to calculate only capitalized cost..
…?

[Tatia]

@piggy93 said:
Yes.. But the question ask for provision. I think his answer is right…..?

Mdaa.. 🙂 I am not sure but in respects of oil operations I guess it muyst be without interest rate. Very interesting :))))

[Tatia]

Also, Can you share your results about consolidation statements?

MCQ-s and Q3 are my hopes for reaching 50 points. But I am not sure. Anyway, today I have started reading theory book of F7. For June exams 😀

In addition, this was my first ACCA exam and I like the way you are sharing your experience and results. It is very useful 🙂

Thanks all 🙂 🙂

[Tatia]

@riskyguy said:
@Xlnc

Great job!

Anyway, below is the solution someone provided in another thread for MCQ 17. What do you think about it. Just like you I got the C option though.

seabed restoration: 250X10000
dismantling: 30000000X0.68X1.08 (8% is the increase of the provision for the year)
the two of them together is answer B

Another solution for option B

so we have the restorative cost of $2,500,000
then we need to add the dismantling provision value at 30 Sept 2013 – 0.68*30 mln=20,400,000
however, since we’re interested at the provision amount one year later – ie Sept 30 2014, we need to unwind the discount for 1 year -> 0.08*20,400,000=1,632,000.
when we add these three together -> we get answer B

Dont you think that unwinding of discount increases a finance cost (PL) and have not be capitalised? I read it in chapter 2.(Tangible non current assets). different opinions, please share 🙂

[Tatia]

@riskyguy

I took my exam version, compared with your answers and just 13 from 20 seems to be right in which I am sure. Its bad 🙁 😀

My answers on calculation based questions were the same as you but I was confused about theoretical questions.

Q4 – mostly likely is C 🙂
Q7 – I thought it was D but now I am not sure.
Q10 – the same situation and my answer is D
As for the Q13 – I think Dituled EPS is somehow gives us a forecast. So My answer was C.
Q-16 My answer was A. I think that negative goodwill will be shown straignt to the P&L
Q18 – C, because it seemed for me confusing. 🙂 now I think that D is right answer.
Q19 – I circled C cause I did not know answer. but seems it is right. Lucky me if it is so 😀
Q-20 Horrible question 😀 Anyway I have C. :/

[Tatia]

@riskyguy

you’re doing a good job! 🙂

So, my answer on Q1 is 1, because I remember the same type of question was and the right answer was change the clasification between administrative expenses and cost of sales(or other).

Q2 – my unswer was B but may be you are right.

Q3. I totally agree with you.

[Tatia]

@mancsi said:
Q6 explanation:
total profit=5m-(1,6+2,4)=1m
proportionate profit=1,8/5X1m=0,36m

cost incurred=1,6m
+profit recognised for the period=0,36m
-progress billings=1,8m
=1,6+0,36-1,8=0,16m=160000

Q19 explanation:
340000-90000=250000
finance cost=250000X0,1=25000
depreciation=340000/5=68000
2. leased item=18000/12X9=13500
In total=25000+68000+13500=106500

Thanks a lot Ati 🙂

[Tatia]

Can anyone explain the calculation of Q6 and Q19?

Thanks.

[Tatia]

@mancsi said:
Hi guys,
I dont understand the C or B as answers to Q18, I chose D, which says that the NRV has been reduced but it is still higher than its carrying value, that to me means that there is no impairment to speak of, so it is not an indication. I do not know where my thinking is wrong.

mdaaa… I found you right :))

but I did not undersand the connection of shares price and e.t with impairment. so my answer was c 🙁

[Tatia]

@nadia2105 said:
so we have the restorative cost of $2,500,000
then we need to add the dismantling provision value at 30 Sept 2013 – 0.68*30 mln=20,400,000
however, since we’re interested at the provision amount one year later – ie Sept 30 2014, we need to unwind the discount for 1 year -> 0.08*20,400,000=1,632,000.
when we add these three together -> we get answer B

and regarding Q18, I thought i was sure, but not anymore 🙂

I did not add the interest rate as I remeber so, that it have to be taken straight to the P&L and increases finance costs.
My answer is 22,900,000. I wonder which one is correct 🙂

[Tatia]

@beyagala

Please link where can I find the questions.

Thanks.

[Tatia]

I agreee. Made the same calculations. Did anyone accrued the interest on cash consideration on 9 Months?

[Tatia]

What did you get the balance on Q3 aproximately? OR goodwill, or any workings number if anyone remebers. Thanks.

[Author]

Posts