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VCAA Accounting Sample Exam Solutions 2019
Seamus Wong:
--- Quote from: GaGeAN on November 04, 2019, 12:15:29 pm ---I know to avoid decimals on the exam and if I see I probably made a mistake, but don't you just round off the numbers and not leave it as a decimal
--- End quote ---
Yes, round them
jasheel:
--- Quote from: jnlfs2010 on November 04, 2019, 10:35:54 am ---For question 5, why do we only allocate the earning of a portion of the unearned sales revenue? I don't think I ever learnt this at school or in textbook, apologies.
--- End quote ---
Yeah its a judgment call. I haven't seen a question like this. I decided to allocate a portion of the unearned sales revenue. My reasoning is from the perspective of Northwest, when they gave only 2/3rds of the ordered desks, they still have a present obligation to provide the 50 desks. So because of that I only allocated 2/3rds of the deposit.
jnlfs2010:
--- Quote from: jasheel on November 04, 2019, 03:20:13 pm ---Yeah its a judgment call. I haven't seen a question like this. I decided to allocate a portion of the unearned sales revenue. My reasoning is from the perspective of Northwest, when they gave only 2/3rds of the ordered desks, they still have a present obligation to provide the 50 desks. So because of that I only allocated 2/3rds of the deposit.
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Should we expect this on the exam? thanks
Seamus Wong:
--- Quote from: jnlfs2010 on November 04, 2019, 03:46:26 pm ---Should we expect this on the exam? thanks
--- End quote ---
I wouldn't. I've been taught to allocate the entire amount, regardless of how much of the original order was filled (assuming that the sales amount is greater than the deposit, which I assume it always will be)
jasheel:
--- Quote from: jnlfs2010 on November 04, 2019, 03:46:26 pm ---Should we expect this on the exam? thanks
--- End quote ---
There's not much guidance from VCAA on what they're expecting, because they don't provide official solutions to the sample exam.
However, I did have a quick look through the AASB standards (on which the course is based on) regarding Revenues from Contracts with Customers. The AASB is the Australian Government agency which issues the accounting standards that accountants have to follow!
https://www.aasb.gov.au/admin/file/content105/c9/AASB15_12-14_FP_COMPdec16_01-18.pdf
Page 9 Paragraph 21(b) seems to suggest that when part of a transaction is fulfilled, and the remaining goods are not different, the transaction has only been partially satisfied. Therefore, any adjustments to revenue are made on a cumulative catch-up basis.
I think its suggesting that when only parts of a contract is fulfilled, the adjustments to the revenue are made gradually until it is fully satisfied. I'd recommend taking a close look through the document if you want some more guidance. Again its very unclear what VCAA is looking for.
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