Hi Sir,
in this question adjustment 1 , plant as we have diposed the plant and we got 2.5 m and it was inlcuded in the sales we need to subtract that ryt . But as we are receiving cash we should also include this in cash in C A In SOFP ryt . But in answer they have not done it .
am i wrong ? if then please explain me how to do just that adjustment .
Ask the Tutor ACCA FR
candel 12/08
The entry they seem to have put through (just interpreting your post) is:
Dr Cash 2.5
Cr Revenue 2.5
The cash entry is correct but the credit entry should have gone to the credit side of a Disposal Account and the balancing figure in that disposal account would then have gone to profit or loss account
The sale proceeds from sale of an asset are NOT credited to Revenue Account
Thank you sir , understood :)
You're welcome
Sign in to reply to this topic.