General Journal Stock Gain

[peter.g15]

Hey guys,
I was doing a NEAP practise paper and i found that one of the questions had multiple adjustments to be made in the general journal.
It said that the owner had withdrawn $2000 of stock and this had not yet been recorded. It also gave the pre-adjustment trial balance stock control level at $240,000. It also said that the stocktake revealed a balance of $243,000.

Since I made the adjustment for the drawings, it would reduce the stock control balance to $238,000. I then made the stock gain adjustment to account for this reduction in stock control, so I put stock gain as $5000 instead of the original $3000.

However, the answers said that there was only a stock gain of $3000. Are the answers correct or am I? I'm pretty sure I've seen past VCAA exams where there was a adjustment that resulted in a change in stock gain/loss, but just looking for certain clarification!

Thanks!

[dan0038]

Hey,

Can you post a pic of the question? Would guess that you are right coz neap has a bunch of dumb errors in their exams (neap isn't really well known for being a good company for accounting exam questions). My advice is to don't continue doing neap exams or tssm exams coz they're trash but thats just me

[peter.g15]

Hey,

Can you post a pic of the question? Would guess that you are right coz neap has a bunch of dumb errors in their exams (neap isn't really well known for being a good company for accounting exam questions). My advice is to don't continue doing neap exams or tssm exams coz they're trash but thats just me

I've actually found the exams quite okay, but these are the ones from their 'smartstudy' exam booklets (not sure if they're different from what you're talking about).
Here's a picture of the question: https://imgur.com/RIYbg8y
Hopefully it's not against forum rules, other I'll delete it and PM you.

[gamma032]

I'm with you on this one. A similar idea is explored in VCAA 2011 Exam 1 Q1.3.5, it got me so I suggest you take a look

The value in the pre-adjustment trial balance was not correct. Once we record the drawings, stock control will appear as $238,000 and so the stock gain is $5000.