Neap 2007 Exam mistakes?

[davyp3]

For those who have done the paper, has you found some errors?

for example

In question 2.1.1 , they failed to recognize the Stock Loss of $32000 in the General Journal in the solution

Also 2.1.4, the expense accounts in the P&L Summary account does not include this stock loss

Why is this?

are you not supposed to add the stock loss for some reason? or is this a mistake?

Can someone please confirm this with me?

thank you

[aposta28]

Definitely a mistake.

[naved_s9994]

I hate it when companies make errors in trial exams. I mean, they make them only once or twice a year. So get the bloddy things right, you NUTS!

[Yitzi_K]

IT'S NOT A MISTAKE, because there was no loss.

Remember that one of the things you have to record is a withdrawal of a car worth 32,000 by the owner.

Since that wasn't recorded previously, it wouldn't have been recorded in the stock card, even though the car has actually left the business, so the physical stocktake would appear to find a stock loss, when really the reason for the 'loss' is the withdrawal of the car by the owner. That's also why the loss is not put into the P/L summary.

I hope I've explained that well enough.

It's a very good question, because it really catches out those who aren't paying attention or don't know their stuff. You should have been suspicious immediately when you saw that the 'loss' had the exact same value as the withdrawal of stock.