the accounting 09 discussion thread

[boogabrain4]

I said that debtors turnover and stock turnover are more to do with the firm's efficiecny asnd are not direcltly linked with the liquidity of the business like working capital ration and quick asset ratio. then blah blah blah.

Aslong as my theory is ok, i'd say around 85-88/90 depending on consequentials

dto and sto are linked very closely with liquidity, no?
if they can't collect debts/turnover stock, how are they going to get cash to pay creditors, wages etc?!

[unknown12]

Stock isn't included in quick asset ratio and it still increased, if only marginally.
And debtors by definition, as it is included in the quick asset ratio, can be readily turned into cash.

[YT_17]

quention 1.2 part and quention 1.5 part were confusing.......maybe for others not.....but i found it did confuse me

[sophx]

effect of depreciation expense on cash flow? it was none right? :S

[PepsiMax]

For another key indicator, I stated 'Creditors Turnover Ratio'.

I was stuck for answers, but I thought that the CTR gave a fairly good indication of a business' liquidity.

[unknown12]

Yeh i don't know, i think that liquidity question is going to be hard to mark

[sdhains]

effect of depreciation expense on cash flow? it was none right? :S

I said that it does not directly effect cash flows and that depreciation is an example of an expense which is not a cash payment. However, as it detracts from profit, claiming depreciation expense can have a positive effect on cash flow as the more expenses claimed the less profit one needs to claim to the tax office. So ultimately claiming depreciation means you dont need to pay as much tax.

I may have been going to far with this ..

[nikinoo]

effect of depreciation expense on cash flow? it was none right? :S

yeh i said that depreciation does not directly effect the cash flow as it is a consumption of economic benefit in the form of a decrease in assets (delivery van), therefore decreasing net profit as an increase in depreciation expense..
cant remember the end.. but thats it =)

[mtwtfss]

I just said something about how its only an assumption made to allocate the expense of owning the asset over the period of its working life, thus doesn't actually effect cash flow. however it may when the business comes to sell the asset.

[nbalakers24]

1.1.2 - was it $12375 accum depn? and $3625 loss?

2.3.2 - what was actual and budgeted rent revenue? i had $24.8k and $24k

[Nelle]

1.1.2 I got the same as you

2.3.2 I said a $1000 difference as the rent revenue changed in August, resulting in five months of $2200 rent revenue.

[nikinoo]

i have no qualms about it, i don't think i lost 1 mark.
You muppets can continue quarreling like uneducated pigs...but you lost marks...and i didnt
i know how to stop fights! just ace the exam! like i did.

nobody cares =)

[nbalakers24]

stfu lc3

[nbalakers24]

1.1.2 I got the same as you

2.3.2 I said a $1000 difference as the rent revenue changed in August, resulting in five months of $2200 rent revenue.

yeah i was going to do that too but it said 'commencing with the payment due on Aug 31'

[charley]

i have no qualms about it, i don't think i lost 1 mark.
You muppets can continue quarreling like uneducated pigs...but you lost marks...and i didnt
i know how to stop fights! just ace the exam! like i did.

Hope you lost shitloads of marks and anyway this is a discussion what you said not a disccussion!

for the last question is interest cover ratio an answer and did anyone else notice that this year they didn't actually ask for any narrations and that the didn't stipulate that GST IS NOT INCLUDED IN THIS QUESTION for budgeting?