Net impact on profit

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September 4, 2017 at 12:12 pm #405313
nk16
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Has prepared draft financial statements for the year ended 30 November 20X7. The following items still require adjustment:
1)The account do not include a cost for electricity for November 20X7 which is expected to be $750
2)The accounts include a prepayment of $780 for the 12months to 30june 20X8.
What is the net impact on profit when the appropriate adjustments are made for these items?
September 4, 2017 at 12:28 pm #405332
John Moffat
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Please do not simply set test questions and expect a full answer!

You must have an answer in the same book in which you found the question and you should ask about whatever it is in the answer that you are not clear about.

The accrual of 750 will reduce the profit.
The prepayment should only be for the 8 months from 1 December X7 to 30 Jun X8.

Have you watched my free lectures? They are a complete free course for Paper F3 and cover everything needed to be able to pass the exam well.
September 4, 2017 at 12:32 pm #405334
nk16
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This was the question we got from practice test we did in class
September 4, 2017 at 12:34 pm #405340
John Moffat
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If they did not give you answers afterwards then you should ask for them – otherwise it is pointless them giving you tests! 🙂
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