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How else could you calculate the current assets?
The SOFP must obviously balance. You are able to calculate all of the other figures except for the current assets. So current assets must be the ‘missing figure’.
Why cant we figure out the current asset ?
I do not get why current asset became the place to throw all the remaining figures
But why waste time even trying???
How are you going to calculate the receivables, the inventory, the cash?You can calculate all the other figures, and the SOFP has to balance.
Hi John, sorry to ask, if I can apply the changes under forecast PAT to Current Asset and let Retained Earning be the balancing, will I get penalized?
In Ennea question, for Proposal 1, their Retained Earning is the balancing while for Proposal 2 and 3 we could balance without any need for balancing, which means we are able to:
1) apply all changes under forecast PAT to Current Asset
2) at the same time add the difference of PAT to RE yet still able to balanceAppreciate your kind advice.
Thank you.
Note: Edited post due to inaccurate information on Ennea part. Amended after checking with the model answer.
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