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Double Entry

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › Double Entry

  • This topic has 3 replies, 2 voices, and was last updated 4 years ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • February 8, 2021 at 6:01 pm #609689
    victorwilson123
    Member
    • Topics: 4
    • Replies: 6
    • ☆

    Dear Mr. John ,

    Please advice to clear the confusion :

    ASSET-LIABILITIES -OPEN
    ING CAP + DRAWING =PROFIT
    Therefore : PROFIT =ASSET- LIABILITIES -OPENING CAP+DRAWING

    PROBLEMS : PROFIT=35400$
    CAPITAL=10200$
    DRAWING=500*12=6000$
    NET ASSET=95100$
    OPENING CAP =?

    Regards,
    Victor

    February 9, 2021 at 8:09 am #609771
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54699
    • ☆☆☆☆☆

    I do not know why you have headed up this post as ‘double entry’ because it has nothing to do with double entry 🙂

    I assume you have watched my free lectures on this and therefore know that the accounting equation is:
    Increase in net assets (capital) = profit + capital introduced – drawings

    I assume that the $10,200 that you have typed as being capital is actually new capital introduced (if not then the question makes no sense at all).

    Therefore:

    95,100 – opening capital = 35,400 + 10,200 – 6,000 = 39,600

    So opening capital = 95,100 – 39,600 = $55,500

    It would seem that maybe you have not watched my lectures, in which case do. They are. complete free course for Paper FA and cover everything needed to be able to pass the exam well 🙂

    February 9, 2021 at 1:10 pm #609832
    victorwilson123
    Member
    • Topics: 4
    • Replies: 6
    • ☆

    thank you Mr john

    February 9, 2021 at 2:39 pm #609846
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54699
    • ☆☆☆☆☆

    You are welcome 🙂

  • Author
    Posts
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