Greetings sir,
I hope you are doing well.
For Q 21.3, I understood the answer for Receivables and Prepayments. But not Payables and Accruals.
Payables I get would be zero.
But my contention is Accruals.
I thought for (1) there should be an accrual c/f of $160 (240/12 x 8) within the Loan Income T Account 2012 for the $240 Interest that is received on the 30th April 2013.
And for (3) under Rent Income 2012, an accrual of $4,000 c/f , which is received in Jan 2013.
As for Q 21.9, I thought it is D, because C cant be correct as only if the non adjusting events are material, they should be disclosed in the notes.
Ask the Tutor ACCA FA
Fa BPP Revision Kit 2020-2021, Company FS, 21.3 , 21.9 Pg 101-103
5y ago#121.3
For 1, as at 31 December 20X2 no interest had been received. Therefore there is accrued interest for 1 years interest which is 2% x $12,000 = $240. (in addition to the $12,000 owing to the company by the employee).
For 3, Yes, there is accrued income of $4,000.
5y ago#221.3
For 1, as at 31 December 20X2 no interest had been received. Therefore there is accrued interest for 1 years interest which is 2% x $12,000 = $240. (in addition to the $12,000 owing to the company by the employee).
For 3, Yes, there is accrued income of $4,000.
Shouldn’t there be accrued interest of 8 months (160) , because the rest of the months are in 2013. Year end is 31 Dec 2012.
And if you agree there is accrual be it of any amount ($4000 + 160/240) , then why the answer which is (B) shows NIL for Payables and Accruals.
Also, you forgot to reply for Q21.9.
5y ago#421.3
As at 31 December X2, the interest earned is the interest earned for the 12 months since the loan was given on 1 January X2. This is what is owing as at 31 December and is therefore the amount of the accrued income.
5y ago#521.9
This is slight unfair, but it is only called a non-adjusting event if it is material.
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