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My sincere appreciation to Sir Moffat for all the great lectures on F3. I did my F3 yesterday and pass with 73%. I am so greatful for the time you spared to answer all my posted questions and the clarification. They are much appreciated, thank you Sir.
Thank you so much Sir, I do appreciate the explanation.I must have been so tired yesterday, it was difficult for me to decode the question. Thank you and have a good day.
The electricity account for Jingles Co for the year ended 30 June 20X1 was as follows.
Opening balance for electricity accrued at 1 July 20X0 300
Payments made during the year
1 August 20X0 for three months to 31 July 20X0 $600
1 November 20X0 for three months to 31 October 20X0 $720
1 February 20X1 for three months to 31 January 20X1. $ 900
30 June 20X1 for three months to 30 April 20X1 $840
Jingles Co expects the next bill due in September to be for the same amount as the bill received in June.
What are the appropriate amounts for electricity to be included in the financial statements of Jingles Co for the year ended 30 June 20X1?SOFP SOPL
A $560. $3,320
B $560 $3,060
C $860 $3,320
D $860 $3,060Please I’m confused with this question, it seems to me as if it’s not correct or maybe I just can not decode it. Firstly, it says 1Aug 20×0 for three month to 31 July 20×0.
If it is 3 months, I guess it should be from August to October. I really don’t understand how to tackle it. Kindly help Sir. It is BPP Mock exam.My understanding according to IAS 16 is that entity are allowed to transfer the excess depreciation to retained earning, IF THEY WISH tO DO SO. In exam question, how are we to know weather to transfer or not.
Thank you for your time
Good morning Sir,
Please I need your clarification with this question.
Banter Co purchased an office building on 1 January 20X1. The building cost was $1,600,000 and this was depreciated by the straight line method at 2% assuming a 50 yrs life and nil residual value. The building was revalued to $2250,000 on 1 Jan 20×6. The useful life was not revised. The company financial year ends on 31 Dec.
What is the balance on the revaluation reserve at 31 December 20X6?
A $650,000 B $792,000 C $797,000 D $810,000
The answer to the question from BPP was B while mine is D. From the solution given, I realised the excess depreciation of $18,000 was transferred from revaluation reserve to retained earning I.e $810,000-$18,000. Which reduced the balance on the revaluation reserve
My question is, in theory, should we always assumed that excess dep’n should be transferred because the question did not state that and I read somewhere that some company does not do the transfer?
Thank you.
Kindly help with this question
The inventory value for the financial statements of Global Inc for the year ended 30 June 20X3 was based on a inventory count on 7 July 20X3, which gave a total inventory value of $950,000.
Between 30 June and 7 July 20X6, the following transactions took place
Purchase of goods. $11,750
Sale of goods (mark up on cost at 15%) $14,950
Goods returned by Global Inc to supplier. $1500What figure should be included in the financial statement of inventories on 30 June 20×3
A$952,750
B $949,750
C $926,750
D $958,95I understand that the new purchase must be deducted and returns should be added however I don’t get the need to add the cost of sale 13,000 or what to do with it. According to the answer given, cost of sales was added back and correct answer is A. Please explain the rational behind it.
Thank you for your time.
Thank you for your prompt response.
Yes, the question is correct, I double checked it and I agree with your answer because it is inflow not outflow as I have chosen, however in the test calculation, it subtract the 500 bonus from the share premium and no changes on the ordinary shares which I believe was wrong.
I really appreciate your clarification, I will stick with that. Thanks a lot.
Hello Sir Moffat,
Kindly assist with this question.
A company has the following extract from a statement of financial position.
20X7 20X6
$’000. $’000
Share capital. 2000. 1000
Share premium. 500. –
Loan stock. 750. 1000
If there had been a bonus issue of 500,000 shares of $1 each during the year, what is the cash flow from financing activities for the year?
A $1,250 inflow
B $750 inflow
C $750 outflow
D $1,250 outflow
The answer given from BPP was C and mine is D.
Ordinary share $1000+$500( bonus)
Share premium $500-$500(bonus)
Total $1500
Cash flow from financing activities
Proceed from issuing shares. (1500)
Loan payment. 250Please shed more light on this. Thanks
Thank you for the answer and explanation. I appreciate your prompt response. It was my mistake, I was using the three years depreciation amount for carrying amount.
I also like to thank you for your help on other papers, I did my F1 and F2 in March with pass grade, your input at Opentuition can not be underestimated and I am grateful for this.
I am sorry, my question is posted here again, it’s because it is the continuation of the above.
I am a little bit confused on how the holding cost was calculated, please explain why it was calculated as 20% of purchase cost. And what is the difference between annual holding cost and total holding cost.
Thank you for your time.
You are amazing Sir, I appreciate you prompt response. The explanation is clear and understood. Thank you ever so much.
Thank you sir for your prompt response. I apologise for posting it twice, I have posted it on wrong forum before I realised my mistake.
Thank you Sir John, for your response to the question. I have gone back to the lecture the second time and it is more clearer.
Sir,
Kindly throw more light on how you arrived at the answer to above question. I am totally lost, although I have listen to your lecture, I still can not figure out the answer.
Thanks a lot.Sorry Karolina, I did not check your response in time, I have got a new one. Hope you sell it soon.
Hello Farzana,
Is the answer 406k or 486k. If you don’t mind, can you let me know where the question comes from. It’s a bit confusing.
ThanksWe should take note that first amount is from year 4, so we can not use year 8 directly in our calculation as it does not start from year 1. Here we will subtract annuity of year 8 from year 3.i.e
Annuity for Year 8 @14%=4.639
Annuity for Year 3 @14%=2.322
Difference=2.317
Present value =2600*2.317=6024.2