VCE Stuff > VCE Accounting
Random Accounting Revision Questions
costargh:
--- Quote from: elaine98 on May 22, 2008, 10:17:46 pm ---
--- Quote from: costargh on May 22, 2008, 10:14:56 pm ---
--- Quote from: jamesdrv on May 22, 2008, 10:00:19 pm ---Business Pty Ltd want to buy a vehicle valued at $50,000 (GST Exclusive). They pay a deposit of 10%, and pay the rest the following week. How would this appear in the cash flow statement (assume all transactions are for cash)?
--- End quote ---
Um wow. Lol never had a question like this.... but I would assume that the entire 50 000 would be reported as a Financing activity cash outflow because its the purchase of a non-current asset.
Although it could be a trick question and the 10 000 could be reported as an operating activity cash outflow and the 40000 as finacning.... hmm
--- End quote ---
yeah i took one look at that and i thought- woah. i am dead. for the exam anyway lol.
but it's good to get those kind of questions, you can never get enough of those tricky ones.
where is it from?
--- End quote ---
Yeh well its awesome to get these tricky questions when we ARENT in an exam situation so if we come across similar ones, we would have encountered them before =)
thanks jamesdrv
elaine:
--- Quote from: costargh on May 22, 2008, 10:16:00 pm ---
--- Quote from: jamesdrv on May 22, 2008, 10:00:19 pm ---Business Pty Ltd contracts with another business to supply 500 chairs for $100 each at some point before the end of the month. How would this affect the accounting equation?
--- End quote ---
No effect?
... wait. Are we assuming that the transaction has gone ahead or not? Or if they jut had a contract and it was expected that the transaction would occur.
--- End quote ---
i think they contract itself has no effect on the equation. but once economic benefit leaves the entity, i.e. the stock, then it would increase assets (debtors) and increase OE.
i'm not really sure
jamesdrv:
--- Quote from: elaine98 on May 22, 2008, 10:17:46 pm ---
--- Quote from: costargh on May 22, 2008, 10:14:56 pm ---
--- Quote from: jamesdrv on May 22, 2008, 10:00:19 pm ---Business Pty Ltd want to buy a vehicle valued at $50,000 (GST Exclusive). They pay a deposit of 10%, and pay the rest the following week. How would this appear in the cash flow statement (assume all transactions are for cash)?
--- End quote ---
Um wow. Lol never had a question like this.... but I would assume that the entire 50 000 would be reported as a Financing activity cash outflow because its the purchase of a non-current asset.
Although it could be a trick question and the 10 000 could be reported as an operating activity cash outflow and the 40000 as finacning.... hmm
--- End quote ---
yeah i took one look at that and i thought- woah. i am dead. for the exam anyway lol.
but it's good to get those kind of questions, you can never get enough of those tricky ones.
where is it from?
--- End quote ---
I just made those questions up, lol. First of all, if you ever see "(GST Exclusive)" it means that GST is included in the transaction, but not in the value given. If you see "(GST Exempt)", the transaction does not involve GST. The answer is that $50,000 would be reported as an investing outflow (under something like "Purchase of vehicle"), and $5,000 would be reported as an operating outflow for the GST component. I don't think examiners really try to trick you with GST though, so I wouldn't worry about it too much.
Edit: sorry, that last question was poorly worded and just bad in general. It wouldn't have any effect on liabilities as there is no present obligation as a result of past events. In accounting terms, nothing has actually happened.
costargh:
Yeh the contract has no effect which is what I interpretted the question to mean firstly.
But then yeh after the transaction occurs stock will decrease, an asset (debtors control or bank depending on cash or credit transaction) will increase, and due to sales increasing, net profit will increase, thus increasing OE.
And I noticed that no GST was mentioned in the question... if it was 10% extra GST then their would be a an increase on the credit side of the GST Clearing ledger.
elaine:
--- Quote --- I just made those questions up, lol. First of all, if you ever see "(GST Exclusive)" it means that GST is included in the transaction, but not in the value given. If you see "(GST Exempt)", the transaction does not involve GST. The answer is that $50,000 would be reported as an investing outflow (under something like "Purchase of vehicle"), and $5,000 would be reported as an operating outflow for the GST component. I don't think examiners really try to trick you with GST though, so I wouldn't worry about it too much.
--- End quote ---
lol you made em up? haha that's awesome
but i'm glad you don't write the exams :P
thanks for the tip about GST exclusive
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