Things to remember for the Mid-Year!!!

[costargh]

This thread is for all little helpful reminders of what to remember before heading into that exam room.
I'll start:

Discount revenue: a reduction in an outflow of economic benefits (less cash paid to creditors) in the form of a reduction in liabilities (creditors) that increases owner's equity.

Discount expense: a reduction in an inflow of economic benefits (less cash received from debtors) in the form of a reduction in assets (debtors) that decreases owner's equity.

[elaine]

Remember to subtract discount revenue from payments to creditors and discount expense from receipts from debtors when posting to the cash flow statement.

[costargh]

General Journal entries should only have the start and end date of a month (eg Jan 1 or Jan 31), while subsidiary ledgers MUST  have the actual date of the transaction (eg Jan 5 and Jan 19)

[Noblesse]

My top tips for accounting:
1. First of all, READ THE QUESTION and pay particular attention to the date attached.
2. Pay attention to whether the question states the business is starting up or commencing using double entry accounting. If the latter, be sure to look for the balances for all accounts unless it is specified they are not there (eg. John’s business is due to start Credit Sales on 1st January 2008, meaning there will be no debtors control balance). If the former, (starting up) then be aware that all capital contributions of cash needs to be put in the Cash Receipts Journal, not the General Journal like all the other balances!
3. Watch for time periods in the question about preparing reports. For example, John’s business makes its accounting reports quarterly. Therefore all balance day adjustments need to be made for 3 months (eg. Depreciation needs to be calculated for 3 months).

[sheepz]

Remember when paying for accrued expenses from last reporting period and a part of this month's expenses to separate them in the cash payments journal (put the accrual in the sundries column!)

[costargh]

For a theory question which requires either an Accounting Principal or Qualitative Characteristic to be identified and then an explanation for the reason (relating to the question), where the mark allocation is 1 + 2 = 3 marks (I HOPE THIS MAKES SENSE)
... ensure that you make two distinct points in your explanation and always link back to the question specifically instead of giving just a generic definition or answer.

[sheepz]

For a theory question which requires either an Accounting Principal or Qualitative Characteristic to be identified and then an explanation for the reason (relating to the question), where the mark allocation is 1 + 2 = 3 marks (I HOPE THIS MAKES SENSE)
... ensure that you make two distinct points in your explanation and always link back to the question specifically instead of giving just a generic definition or answer.

Use the IDL method! Identify, Define, Link =)

[Noblesse]

Pay special attention to whether the question requires a narration, balancing or footing! Many marks can be lost this way by not reading the question properly.

[ben4386]

I think we should make a list of Tips that save time,

For example what I do is if I do a cash flow statement and I find the net increase or decrease at the end, I calculate the difference between total cash receipts and payments, and if its different I look for errors, If its the same I dont even bother checking it over at all.

Theres a magic Number 45974,

A maximum of 4 entries in the bank ledger (balance, receipts, payments, finanl balance)

5 entries in debtors control (opening balance, sales/gst, bank/disc exp, bad debts, final balance)

9 for stock control (Opening Balance, two cost of sales (credit/cash), Bank (cash purchase), creditors (credit purchase), stock loss/gain, drawings of stock, contributions of stock, final balance, ive probably missed a couple lol)

7 for GST (opening balance, 2 x Bank (purchases/receipts), Debtors, Creditors, GST settlement or GST refund, final balance)

4 for creditors control (Opening Balance, Stock Control/GST, Bank/Disc Rev, Final Balance)

this really ensures that you dont omit anything

I always find that if you are presented with a Trial balance mark down the side of it , E or R, CA NCA, CL NCL or OE, that way you know what goes where before you start (ive left out stuff multiple times) once you post everything you need to tick it off so you know you have posted it and so that you dont leave it out or post it twice.

Another thing with the trial balance, If your trial balance does not balance and it is a multiple of 9 off, e.g. 36, 45, 54, it means that you have swapped numbers in a figure i.e. 56940 instead of 56490


Another thing is with commencing entries, if it has opening balances for creditors and debtors you must put in a figure for debtors control/creditors control as well as list each debtor/creditor with a figure in the subsidiary ledger part of the general journal

Hope this helps

ben

[Fyrefly]

Theres a magic Number 45974,

Sounds like someone went to an Anthony Simmons lecture...

[elaine]

When calculating Historical Cost for non current assets:

In
-purchase price
-modifications
- freight in
-installation

Out
-on road costs of insurance, registration
-GST
- annual service contract


Anyone care to add on to the list?

I wasn't sure about registration-i thought it would be part of the costs incurred in 'getting the asset in a condition and location ready for use'. but alas, it was one of the answers in a practice question.

[gta007]

Not sure if this applies anymore, but in a previous exam (IIRC correctly the 2006 one), on VCAA exams, they usually leave an extra line in the answers. So don't stress if you think if you have left out one item - it's just VCAA trying to trick you into putting an alien.

I hope this is right, and people don't sue me for giving false information. 

[Fyrefly]

Not sure if this applies anymore, but in a previous exam (IIRC correctly the 2006 one), on VCAA exams, they usually leave an extra line in the answers. So don't stress if you think if you have left out one item - it's just VCAA trying to trick you into putting an alien.

I hope this is right, and people don't sue me for giving false information. 

No, you're right. I remember last year's exam had an extra line for every BDA question.

[milo141]

Remember to subtract discount revenue from payments to creditors and discount expense from receipts from debtors when posting to the cash flow statement.

YESS!!!!
A mistake I unfortunetly made in the practice. Oh well, better do it now than later

[nbalakers24]

When calculating Historical Cost for non current assets:

In
-purchase price
-modifications
- freight in
-installation

Out
-on road costs of insurance, registration
-GST
- annual service contract


Anyone care to add on to the list?

I wasn't sure about registration-i thought it would be part of the costs incurred in 'getting the asset in a condition and location ready for use'. but alas, it was one of the answers in a practice question.

also insurance on delivery is in.