VCE Accounting Exam Discussion and Questions

[Joseph41]

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[MattCorp]

Yeah i thought it was really good! There were just a few things im not sure about to be honest! For instance, there is a lot of debate whether you were meant to put include the memo in the GST clearing account as it asked to pay the outstanding amount. Also the income statement i did $7000X6 months for the wages expense then decucted 144 from it which was accured. Im not sure if that is correct i think, pretty sure its wrong. I really want to see the solutions though!

[waterangel82]

Yeah i thought it was really good! There were just a few things im not sure about to be honest! For instance, there is a lot of debate whether you were meant to put include the memo in the GST clearing account as it asked to pay the outstanding amount. Also the income statement i did $7000X6 months for the wages expense then decucted 144 from it which was accured. Im not sure if that is correct i think, pretty sure its wrong. I really want to see the solutions though!

You're not meant to include the memo because it's net yet transaction (but I made that mistake). For the wages expense, I added the 144 because it is incurred and not yet paid. Overall, the final figure I got for the income statement was $46556 and the total of current assets was $39200.

It was a fairly straightforward exam, though I'm not absolutely sure whether I will receive full marks for the two 6 mark questions.

For instance, the question on depreciation was almost the exact same as the one in the 2015 exam, so I wrote along the points that it is highly relevant when determining an accurate profit figure for reporting period, referring to both relevance and reporting period principle. I said it wasn't reliable, no source documents, not free from bias and error. Then I expanded how the two methods give different depreciation expense/net profit figure, and although an accurate profit figure can be calculated by allocating cost against revenue-earning pattern, depreciation can never be truly reliable. Would this be alright?

For the cash flows and operating satisfactorily, I felt that this was similar to 2013's exam. I said that for satisfactory performance, other reports such as income statement should also be considered, so that aspects such as profitability can be evaluated. I said that overall net increase in cash position perhaps satisfactory in that the business has more cash on hand to pay for necessary payments. Overall net inflow from investing and financing suggests perhaps business is selling off less efficient assets for newer ones, and maybe taking out loans, and adding capital to expand the business, which may have positive effect on profitability. However, upon closer inspection, there is a large negative cash flow for operating, and this is concerning as the business has trouble generating a positive cash flow in its day to day trading activities, suggesting that it is perhaps not self-sustainable in this aspect. I then talked about how taking loans/contributing capital is not sustainable in the long run. Would this be okay?

[MattCorp]

You're not meant to include the memo because it's net yet transaction (but I made that mistake). For the wages expense, I added the 144 because it is incurred and not yet paid. Overall, the final figure I got for the income statement was $46556 and the total of current assets was $39200.

It was a fairly straightforward exam, though I'm not absolutely sure whether I will receive full marks for the two 6 mark questions.

For instance, the question on depreciation was almost the exact same as the one in the 2015 exam, so I wrote along the points that it is highly relevant when determining an accurate profit figure for reporting period, referring to both relevance and reporting period principle. I said it wasn't reliable, no source documents, not free from bias and error. Then I expanded how the two methods give different depreciation expense/net profit figure, and although an accurate profit figure can be calculated by allocating cost against revenue-earning pattern, depreciation can never be truly reliable. Would this be alright?

For the cash flows and operating satisfactorily, I felt that this was similar to 2013's exam. I said that for satisfactory performance, other reports such as income statement should also be considered, so that aspects such as profitability can be evaluated. I said that overall net increase in cash position perhaps satisfactory in that the business has more cash on hand to pay for necessary payments. Overall net inflow from investing and financing suggests perhaps business is selling off less efficient assets for newer ones, and maybe taking out loans, and adding capital to expand the business, which may have positive effect on profitability. However, upon closer inspection, there is a large negative cash flow for operating, and this is concerning as the business has trouble generating a positive cash flow in its day to day trading activities, suggesting that it is perhaps not self-sustainable in this aspect. I then talked about how taking loans/contributing capital is not sustainable in the long run. Would this be okay?

Oh damn, rip a few marks there for the GST and income statement question! Would you like to share what your responses were for why the ROA did not change but ROI changed significantly? I basically said since Net Profit or Total assets either increased by the same amount or did not change it meant that the owner could have possibly taken out more drawings than the net profit figure, decreasing capital and therefore increasing ROI without affecting any change to the ROA. Also, what was your stock loss figure that you reported in question 1 into the general ledger? Thanks!

For the depreciation question it looks pretty much perfect, basically same as what i wrote. Did you by any chance state why its not reliable besides not free-from bias? I included that but also said its based on estimates that is estimating the residual value and useful life. Not sure if it would be the decisive factor between a 5/6 but thats what i included as extra.

For the cash flow question your response seems to also align very closely with mine! Looks pretty well answered to be honest! When i was discussing the negative cash flow from operations i said that this is not satisfactory for the reasons you mentioned. But i also added that although this is negative i am not able to determine whether this is imporving or not as there are no previous reports or budgets i can compare this to. Perhaps this is improving as the buisness 'increased its sales' which means more cash inflows.

It was a bit ambigious for them to give us that cash flow statement overview with very limited resources supplied.

[waterangel82]

Oh damn, rip a few marks there for the GST and income statement question! Would you like to share what your responses were for why the ROA did not change but ROI changed significantly? I basically said since Net Profit or Total assets either increased by the same amount or did not change it meant that the owner could have possibly taken out more drawings than the net profit figure, decreasing capital and therefore increasing ROI without affecting any change to the ROA. Also, what was your stock loss figure that you reported in question 1 into the general ledger? Thanks!

For the depreciation question it looks pretty much perfect, basically same as what i wrote. Did you by any chance state why its not reliable besides not free-from bias? I included that but also said its based on estimates that is estimating the residual value and useful life. Not sure if it would be the decisive factor between a 5/6 but thats what i included as extra.

For the cash flow question your response seems to also align very closely with mine! Looks pretty well answered to be honest! When i was discussing the negative cash flow from operations i said that this is not satisfactory for the reasons you mentioned. But i also added that although this is negative i am not able to determine whether this is imporving or not as there are no previous reports or budgets i can compare this to. Perhaps this is improving as the buisness 'increased its sales' which means more cash inflows.

It was a bit ambigious for them to give us that cash flow statement overview with very limited resources supplied.

You would lose one mark for the GST alien, and another for the wages expense. I didn't write what you wrote for ROA and ROI, because it was comparing two businesses, not business over time.. So I wrote something like how proportionally, both businesses have same net profit figure as a proportion of their assets, although in dollars net profit could be much higher for one business. And I said business B more dependent on debt ratio, than linked it with ROI. There was no stock loss or general ledger in question 1, so I'm assuming you're talking about the general journal for question 5. I got $380 for stock loss, cause you have to take into account the donation.

But yeah, I think your theory responses are better than mine, so I'm scared that I'll potentially drop marks for those. Like for depreciation I stated how the expense for reporting period not reliable as is not based on source documents to verify such an amount, so it is not truly accurate and free from bias, and then talking about how two methods can give two different net profit figures, which is not truly reliable.

[omcgil15]

Any chance someone could upload a copy of the exam? I'll work through some suggested solutions if you can !

[tinkerbell101]

Sorry but I'm not sure if this is the right place to post this but I was just wondering if anybody would be able to predict whether I'll be able to get a 43 or above 

Unit 3 average- 94%
Unit 4 average- 84%
Exam- possibly around a 95%

Thanks so much. I'm a bit worried my unit 4 sacs will pull me down.  

[v1shnu]

What did everyone for the stock loss, my friends got 220, 540 and 380. Which one is correct? btw is conservatism wrong to use as the principle for the  Depreciation Income Statement 6 marker? Like i was like by not acknowledging the expense that is likely when the assets earn revenue, profit can become overstated. Thanks.

[v1shnu]

Sorry but I'm not sure if this is the right place to post this but I was just wondering if anybody would be able to predict whether I'll be able to get a 43 or above 

Unit 3 average- 94%
Unit 4 average- 84%
Exam- possibly around a 95%

Thanks so much. I'm a bit worried my unit 4 sacs will pull me down.  

With an expected exam result of 95% i wouldn't be worried about the unit 4 sac average. You should get around mid-40s. Tbh the lowest you will probably get is like 43.

[tinkerbell101]

What did everyone for the stock loss, my friends got 220, 540 and 380. Which one is correct? btw is conservatism wrong to use as the principle for the  Depreciation Income Statement 6 marker? Like i was like by not acknowledging the expense that is likely when the assets earn revenue, profit can become overstated. Thanks.

I got 540 but I'm not sure if it's right. And no I don't think so, I used conservatism as well as reporting period and relevance/reliability. But with conservatism, I stated that the total assets would be overstated by not showing acc. depn. I accidentally made the mistake of including the memo in the GST Clearing account. There goes 1 mark

[tinkerbell101]

With an expected exam result of 95% i wouldn't be worried about the unit 4 sac average. You should get around mid-40s. Tbh the lowest you will probably get is like 43.

Oh really?! I actually have some hope. Thanks for the reply

[gfosdfos]

what did you guys get for net sales revenue and the loss on disposal of the pizza oven

[MattCorp]

what did you guys get for net sales revenue and the loss on disposal of the pizza oven

I think i got $2660 for total net sales revenue and $1650 for loss on disposal. Although i cant remember exactly but fairly sure those are the numbers i got. What about you?

Edit; Net sales is $2660 not $2400

[MattCorp]

Any chance someone could upload a copy of the exam? I'll work through some suggested solutions if you can !

Hopefully this works, one guy just sent this to me; https://imgur.com/a/CVnXt

The quality is terrible hah

[rithvikc]

I got 540 but I'm not sure if it's right. And no I don't think so, I used conservatism as well as reporting period and relevance/reliability. But with conservatism, I stated that the total assets would be overstated by not showing acc. depn. I accidentally made the mistake of including the memo in the GST Clearing account. There goes 1 mark

I got 380. Note that the owner had withdrawn $160 worth of stock that had not yet been recorded. Therefore this figure must be deducted from the stock control balance. (22400 - 160 - 21860 = 380)

As for the Accounting Principle, 'Reporting Period' seemed to be the most suitable reponse, simply because the depreciation is calculated per reporting period and it allows the business to obtain accurate expenses, hence profit in preparation for the start of the next Reporting Period.