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Dear lecturer,
Could you tell me when we should take the percentage of irrecoverable debts into calculation while doing cash budget exercises because I saw some exercises did include it into the calculation, but others did not ? Does it have any notices about taking the percentage of irrecoverable debts into calculation ?The second question is the issuing of share capital. Could you give me a clear example to demonstrate the process of issuing share capital because I really don’t understand it. Does issuing of share capital affect cash flow statement, income statement and balance sheet ?
In cash budgets you are showing simply the cash receipts. If any of the debts are irrecoverable then the cash is not received and therefore will not appear in the cash budget.
Share capital is not relevant for Paper F2 – only for Paper F3.
You can find lectures on it in the Paper F3 section. (If new share capital is issued, it appears in the Statement of financial position and the Statement of cash flows, but never in the Statement of profit or loss)Our free lectures for both F2 and for F3 are complete courses for these papers and cover everything needed to be able to pass the exams well.
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