Accounting Question Thread

[eeps]

LOL. just a warning...

- IF ANYONE has done the TSSM 2010 Budgeting Outcome 2 [case study on financial planning and decision making] PAPER (100 marks for 100 minutes) it is insanely LONG and there is a lot of reading... SECTION A is a killer... (THIS paper was practice for our BUDGETING SAC.)

- ALSO, has anyone done their BUDGETING SAC yet?...

Nope, i think my budgeting sac is sometime next week, where did you get the TSSM budgeting outcome from?

my Accounting teacher printed it off for us (my school buys PAPERS from TSSM)... 18 pages long it is... around 3 pages worth of reading JUST to adjust General Ledger accounts, then you have to do the Budgeted P/L Statement, Budgeted Cash Flow Statement and Budgeted Balance Sheet. and that's only SECTION A... although SECTION B is considerably easier...

[LFTM]

LOL. just a warning...

- IF ANYONE has done the TSSM 2010 Budgeting Outcome 2 [case study on financial planning and decision making] PAPER (100 marks for 100 minutes) it is insanely LONG and there is a lot of reading... SECTION A is a killer... (THIS paper was practice for our BUDGETING SAC.)

- ALSO, has anyone done their BUDGETING SAC yet?...

Nope, i think my budgeting sac is sometime next week, where did you get the TSSM budgeting outcome from?

my Accounting teacher printed it off for us (my school buys PAPERS from TSSM)... 18 pages long it is... around 3 pages worth of reading JUST to adjust General Ledger accounts, then you have to do the Budgeted P/L Statement, Budgeted Cash Flow Statement and Budgeted Balance Sheet. and that's only SECTION A... although SECTION B is considerably easier...

sounds draining..

[eeps]

LOL. just a warning...

- IF ANYONE has done the TSSM 2010 Budgeting Outcome 2 [case study on financial planning and decision making] PAPER (100 marks for 100 minutes) it is insanely LONG and there is a lot of reading... SECTION A is a killer... (THIS paper was practice for our BUDGETING SAC.)

- ALSO, has anyone done their BUDGETING SAC yet?...

Nope, i think my budgeting sac is sometime next week, where did you get the TSSM budgeting outcome from?

my Accounting teacher printed it off for us (my school buys PAPERS from TSSM)... 18 pages long it is... around 3 pages worth of reading JUST to adjust General Ledger accounts, then you have to do the Budgeted P/L Statement, Budgeted Cash Flow Statement and Budgeted Balance Sheet. and that's only SECTION A... although SECTION B is considerably easier...

sounds draining..

LOL. it is... every time I turn over the page... I see blank spaces of a P/L Statement/Cash Flow Statement/LEDGERS that need to be filled in. It's question after question... == Although it's good practice and all... it's way too long!

WHAT sucks even more is that I hate it when my figures in the Balance Sheet don't add up after I've done all that work (both the Cash Flow Statement and the P/L Statement)...

[eeps]

Question:

Explain why the amount charged for Depreciation on Shop Fittings differs from the amount budgeted (Note: The business did not purchase or dispose of any Shop Fittings during the year.)

- The AMOUNT Budgeted was $2250.

- The ACTUAL AMOUNT was $4500.

[Thus, it is was unfavorable in the amount of $2250.]

I'm unsure what reason/explanation would be... NOTING that the question is worth 2 marks.

Thanks.

*Edit: DON'T WORRY I GOT IT.

LOL.

[pooshwaltzer]

Given that VCE only considers SL Depn (which is quite retarded; however, I digress...):

Depn = (Hist Cost - Resid) / Useful Life

Causes for Actual > Budgeted (expected):
1. Market value for asset increases; post revaluation (appreciation), asset is depreciated more heavily holding base and all else constant.
2. Residual / Disposal value decreases from what was originally anticipated at time of inception.
3. The useful economic life of the asset is reduced due to changing conditions, eg. redundant productivity, obsolescence, excess of average wear & tear etc.

[eeps]

My response to the question was that the METHOD of DEPRECIATION may have changed during the Reporting Period and thus the business may have incurred a higher DEPRECIATION on the Shop Fittings.

I think my answer is right b/c the follow-up question to it was "State and explain the Accounting Principle that may have been breached by your response." - to which my answer was Consistency.

[sam.utute]

My response to the question was that the METHOD of DEPRECIATION may have changed during the Reporting Period and thus the business may have incurred a higher DEPRECIATION on the Shop Fittings.

I think my answer is right b/c the follow-up question to it was "State and explain the Accounting Principle that may have been breached by your response." - to which my answer was Consistency.

I would have written the same thing.

[eeps]

Question:

HAS anyone done Question 'e' in Ex 18.4 of the Cambridge Textbook - relating to Return on Assets and Asset Turnover?.. I don't know what the answer would be. :S

THE question is "Suggest two strategies the owner could adopt to improve Net Profit in 2010 without changing Asset Turnover."

Thanks.

(a .jpeg of the question has been attached to this post.)

[nbalakers24]

lower cost of sales so getting a cheaper supplier

and lowering expenses such as wages/advertising

[eeps]

lower cost of sales so getting a cheaper supplier

and lowering expenses such as wages/advertising

Thanks!

[eeps]

In relation to the Budgeting CHAPTER are the only real THEORY questions... like... why did we prepare _____ report etc?... I can't think of any other real THEORY questions based on BUDGETING...

DOES anyone have any other THEORY questions which they have come across in this CHAPTER?..

[_avO]

1. Benefit of preparing budgeted reports
2. Benefit of preparing variance reports
3. Outline the steps in the budgeting process
4. Outline alternatives that an owner may choose if a business is budget to run a [cash] deficit
5. Explain how preparing a Budgeted Cash Flow statement quarterly rather than annually may improve the cash control of the business
6. Explain why managers should regularly prepare budgeted profit and loss statements.
7. Explain the function of the budgeted cash flow statement.
8. Explain which variances should be investigated by a business
9. Explain how the budgeted cash flow statement could be improved to enable it to be used more effectively during the budgeted period
10. Explain how the budgeting process may breach Reliability.
11. Identify an appropriate characteristic and explain how it links to Budgeting
12. State an advantage and a disadvantage of completing budgets more than once a year as opposed to once a year

[eeps]

I reckon I know the answers to most of them... except for # 4, 8, 10, 11 and 12.

LOL. care to answer those questions for me?.. I've got no idea on those ones. :\

[_avO]

4 and 8 are based on the case study, so for example 4. the business may have made large amounts of drawings or expenditure in NCA's
and 8. the variance in loan receipt is favourable, indicating a likelihood of higher interest incurred hence maybe reducing the loan receipt for the next period will be appropriate

10. Budgets are all estimates so it may be unreliable (no source of evidence, just mere guesses) , however it is relevant to decision making
11. Relevance - aids planning and decision making
12. Advantage: More relevant and can prevent earlier shortcomings and problems
     Disadvantage: the more you budget into the future, the more likely it will be unreliable (can be verified by variance reports later)

[eeps]

4 and 8 are based on the case study, so for example 4. the business may have made large amounts of drawings or expenditure in NCA's
and 8. the variance in loan receipt is favourable, indicating a likelihood of higher interest incurred hence maybe reducing the loan receipt for the next period will be appropriate

10. Budgets are all estimates so it may be unreliable (no source of evidence, just mere guesses) , however it is relevant to decision making
11. Relevance - aids planning and decision making
12. Advantage: More relevant and can prevent earlier shortcomings and problems
     Disadvantage: the more you budget into the future, the more likely it will be unreliable (can be verified by variance reports later)

sweet! THANKS heaps!