Acca f3 Financial Accounting (int) Study Text

434

Exam answer bank

26  

D  

438,900 – 980 – 90 = 437,830  The figure of $90 is $4,434 – $4,344. 

27 

B  

– 3,860 – 9,160 + 16,690 = 3,670.  Remember that the opening bank balance is overdrawn. 

28  

B  

Items 2 to 4 are adjustments to the bank balance per the statement. 

29 B 

 

30 

C  

83,600 + 18,000 – (18,000*25%) = 97,100 Add back the capital expenditure, but charge 

depreciation for the year. 

31  

B  

32  

B  

33 

B  

The inventory account is only changed at the end of the accounting period. 

34 

A  

Remember the business equation: P = I + D – C

i.

35  

D  

(318,000 + 412,000 – 214,000) – (612,000 × 75%) = 57,000

36  

A  

836,200 – 8,600 + (14,000 × 70%) + 700 = 838,100

37 A   

PAYABLES 

LEDGER 

$

$

Cash paid

302,800

O/Balance

60,000

Discounts received

2,960

Purchases (bal.. fig.)

331,760

Contra

2,000

C/Balance

  84,000

391,760

391,760

38  

B  

((300,000 + 30,000) / 2 × ½ ) + (300,000 + 30,000) / 2 × 1/3) – (30,000 × ½ )) = 122,500

39  

A  

Goodwill is usually brought in under the old PSR and written off in the new PSR. 

40  

D  

5,750 + (86,500 × 3/5) – 4,300 = 53,350  

41 

B  

Dividends appear in the SOCIE. 

42  

D  

 

43  

C  

Item 2 is charged to the income statement, and item 3 to ‘other comprehensive income’. 

44  

B  

125,000 + (500,000 × 1/2 × 25c) + (750,000 × 1/5 × 25c) = 225,000; 100,000 + 

(500,000 × 1/2 × 75c) – (750,000 × 1/5 × 25c) = 250,000

45  

B  

12,000 + (12,000 × 2%) + (9,000 × 8/12) + 4,000 = 22,240

46 B 

 

47  

A  

All these items provide additional information about conditions at the reporting date. 

48  

B  

 

49  

D  

Items (1) and (3) do not involve movements of cash. 

50 

 

C 

 

   

51  

A  

 

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435

Index

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436

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Index

437

Note: Key terms and their page references are given in bold.

A

ccounting concepts, 14 

Accounting equation, 74 

Accounting for sales tax, 119 

Accounting policies, 47, 274, 363 

Accounting records, 341 

Accounting standards, 14, 20 

Accrual basis of accounting, 30

Accruals, 192, 193, 198 

Accruals and prepayments, 295, 305 

Accumulated depreciation, 162

Adoption of an IFRS, 48 

Advantages and disadvantages of trading as a 

partnership, 326 

Advantages of cash flow accounting, 399 

Allowance for receivables, 208, 215 

Amortisation, 185

Amortisation of development costs, 187 

Appropriation of profit, 328, 329 

Asset, 9

Audit trail, 407 

Authorised (or nominal) capital, 343 

AVCO (average cost), 137

B

alance between benefits and cost, 40 

Balance between qualitative characteristics, 40 

Balance sheet, 106, 107, 209, 247, 367 

date, 361 

disclosures, 363 

Balancing ledger accounts, 102 

Bank charges, 254 

Bank interest, 254 

Bank reconciliation, 255, 260 

Bank statements, 65 

Benefits of cash flow information, 389 

Bonus (capitalisation) issues, 352 

Books of original entry, 90 

Books of prime entry, 61

Business entity concept, 74

Business equation, 307 

C

alled-up capital, 343 

Capital, 74

Capital account, 328 

Capital expenditure, 151

Capital income, 151 

Capital transactions, 151 

Carriage inwards, 128 

Carriage outwards, 128 

Carrying amount, 173

Cash, 364, 389

Cash and cash equivalents, 390 

Cash book, 61, 63, 95, 295, 302 

Cash discount, 234

Cash discounts, 234, 235 

Cash equivalents, 389

Cash flows, 389

Cash transactions, 83 

Change in accounting estimate, 47, 274

Changes in accounting policies, 47 

Coding, 407 

Comparability, 39 

Comparative information, 32 

Compensating errors, 103, 266, 268

Completeness, 39 

Computer programs, 406

Concepts of capital and capital maintenance, 41 

Consistency of presentation, 31 

Contingent asset, 224

Contingent liability, 224

Continuous inventory records, 134 

Control account, 232, 246 

Correction of errors, 91, 268 

Cost, 173

Cost formulas, 144 

Cost of goods sold, 127 

Costing module, 408 

Costs of conversion, 143 

Costs of purchase, 143 

Counting inventories, 134 

Credit, 82

Credit note, 60

Credit sales and trade accounts receivable, 294, 

296

Credit transactions, 84 

Creditors, 85 

Credits, 102 

Criticisms of accounting conventions, 42 

Criticisms of the accrual assumption, 43 

Criticisms of the prudence concept, 42 

Cumulative weighted average costing, 139 

Current account, 328

Current asset, 368 

Current liabilities, 368 

Current replacement cost, 135 

D

atabase, 413

Day book analysis, 91 

Debit, 82

Debit note, 60 

Debits, 102 

Depreciable amount, 154, 185

Depreciable assets, 154

Depreciation, 154, 175, 178 

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