Accounting Question Thread

[pooshwaltzer]

How would the Cash Deposit be reported in the Balance Sheet?

I think you've got your depositor and deposit-taker mixed up.

In your hypthetical EG,

Jim's Cars = buyer = depositor ... records deposit of $3k paid as prepaid asset (under current assets).

Ford Motors = seller = deposit-taker ... records deposit of $3k received as unearned revenue (under current liabilities).

[eeps]

How would the Cash Deposit be reported in the Balance Sheet?

I think you've got your depositor and deposit-taker mixed up.

In your hypthetical EG,

Jim's Cars = buyer = depositor ... records deposit of $3k paid as prepaid asset (under current assets).

Ford Motors = seller = deposit-taker ... records deposit of $3k received as unearned revenue (under current liabilities).

LOL.

yeah, I think I might have.

my bad.

[eeps]

Question:

What's the difference between 'Buying Expenses' and 'Selling Expenses'... like the definitions. Buying Expenses go under COGS right? and Selling Expenses go under 'Other Expenses'? [in the P/L Statement.]

[_avO]

Yeah, I would assume buying expenses relate to all the costs required to prepare stock, and selling expenses is everything else such as freight out, delivery and (discount expense? idk)

[eeps]

Yeah, I would assume buying expenses relate to all the costs required to prepare stock, and selling expenses is everything else such as freight out, delivery and (discount expense? idk)

Yep, that seems about right.

[eeps]

Has anyone got any hard theory questions that they could post?... relating to Chps. 13-16 of the Cambridge textbook. This would help greatly in my upcoming SAC next week, to test my knowledge... [Returns of Stock, Stock Valuation, Accounting for Non-current Assets and Balance Day Adjustments - Revenues.] I pretty confident with the practical side of the chapters... I need more practice with answering different types of theory questions.

Thanks.

[eeps]

Question:

It's another one of those 'Stock Write Down' questions...

Alma’s Animalia has given you the following information regarding its stock of Cat Scratching Posts as at 31 August 2007:

Scratching Posts:   Stock on hand:  20@$120 $2,400
                                                  10@$130 $1,300

The normal selling price of a scratching post is $190 (plus $19 GST) each, but now every pet shop has them and the owner estimates she will only be able to sell them for $140. It is estimated this will require extra selling expenses of $300 (plus $30 GST). Memo 31

Calculate the Stock Write Down on the Scratching Posts as at 31 August 2007

So what I've done so far is... $140-(300/30)

Which = $130... i.e. Net Realisable Value. sorta stuck at this point... what would the Stock Write Down?... or it can't be done... since the historical cost/cost price of the stock... is already at $130?

Thaaanks.

[_avO]

Yea it doesnt look like there will be a stock write down as the NRV is not lower than cost price :/ weird..

[eeps]

kk. thanks.

[pooshwaltzer]

expenses of $300 (plus $30 GST). Memo 31

330 / 30 = 11

so,

10@$130 $1,300

written down by $1ea

so,

stock writedown.........10
.....stock control....................10

[eeps]

Umm... I don't think the $30 of GST would be included as part of the 'Selling expenses'. :\

[_avO]

Yea in VCE accounting, GST isnt included in most of this kind of stuff

[eeps]

Has anyone got any revision material they could post up/or direct me to on VN for SAC revision? (see below.)

:: Returns of Stock (Sales & Purchases Returns, Stock Valuation (Product + Period Costs etc.), Accounting for Non-current Assets (Trade-In, "Profit/Loss on Disposal of ____") and Balance Day Adjustments - Revenues (Prepaid/Accrued Revenue). :: - doesn't matter which CHAPTER.

If people could post some stuff up/or direct me to SAC material, it would be greatly appreciated!

[sam.utute]

Have you got all the Cambridge SACs (i.e. Outcome 1A, 1B, 2A etc.? They are posted up somewhere on this forum (a link to megaupload or something). Great for revision.

[eeps]

Have you got all the Cambridge SACs (i.e. Outcome 1A, 1B, 2A etc.? They are posted up somewhere on this forum (a link to megaupload or something). Great for revision.

Yep, I done Cambridge SACs 1A & 1B... as they're currently the only ones which are relevant to my upcoming SAC next week. Is the Cambridge Checkpoints 2010 a good source for revision...? I've done most of the SACs/worksheets that I've found on VN, but I am still feeling a bit under-done in some areas... i.e. stock write downs.