difficulties with comparing answers to QATS 2007 - i have attached it!

[hello_kitty]

Hey guys, ive been doign the 2007 Qats prac exam and have some questions:

Questions:

1.1.2   How do I calculate the Mark Up??

2.2.2   I'm not sure how to calculate the adjustments for Depreciation of Shop Equipment, Rent Expense and Salaries Expense? how would i come about this?

2.3.1   How do i calculate what has to be recorded into the CPJ??

2.4   I just dont understand what this question is asking and how to come about this as well?

Also just clarify, the GENERAL LEDGER always  is the date  at the end of the Reporting Period, the only exception is the balance which occurs in the beginning of the reporting period?

And Would anyone by any chance be able to upload the Neap 2008 Prac Exam? and VCTA 2008??


Thanks Heaps!! Good luck for everyone with the exam!!

[nacho]

1.1.2
Simple arithmetic.
IF you look at the OUT column for, Mar.12, you'll see that 8 golf bags worth $150 are leaving the business.
Now, if you look underneath the stock card, where it says "NOTE:"
it says: "The golf bags are sold for $300 each."
Therefore there is a 100% mark up on stock sold at march.12 (we bought it for $150, then sold it for twice the amount we bought it for, therefore 100% mark up)

2.2.2
For this, use the information provided with the "Additional information"
This is actually a really important skill, so make sure you can do this. (i.e. depreciate and calculate consumptions of assets)
I'll help you with rent.
So if we paid $4 000 worth of rent (Prepaid Rent) on 1 January 2007  to cover a twelve month period, how much of it do we 'consume' each month?

When you figure this out, you can figure out how much we've used uptil the 31st of May, 2007, since 1 January 2007.

Because it is a consumption of an asset (Prepaid rent is an asset we've partially consumed) there is an expense, called Rent expense.
So, we have to credit our asset, "Prepaid Rent" by $x (as we've used some of it) and debit Rent Expense by $x amount, as it's an expense.

2.3.1
Salary payment is just wages, but because we owe some salary payment from the previous payment, we record this differently.

The business pays salaries fortnightly. The next salaries payment of $2550, including the accrued salaries
will be made on 6 June 2007.

accrued wages (wages owing) is $880
but we are paying $2550, so some of it will be for the current reporting period too. Note the conventions i use when i record this:

so
Date   |     Details       | chq.no | Bank     |     ... |  ....   |  .... | Wages | .... | Sundries
June 6     Wages/           341        $2550                                   1670
           Accrued Wages                                                                                880


Last question,
asks you to:
- Define and state the difference between relevance and reliability
- Outline a situation in accounting where a process causes a breach in either relevance or reliability, but we do it anyway.

[lilmamba17]

With the last question, you are pretty much covering yourself when you go, relevance states that blah.... whereas reliability states that blah... And then by relating it to the depreciation of shop fittings you say although depreciation is a breach of reliability in that it is a value based on estimates which undermines its accuracy, however depreciation is necessary and ensures reports are useful for decision making and thus upholds relevance

[hello_kitty]

thank you all so much