Accounting Paper 12 .... how was it ?

[Sjs1993]

what about the accounting concept? umm, the machinery one? in which we capitalised cost n charged some to pnl?

 

[Sjs1993]

what about ratio whether to sell a product?

GP Margin

 

[rfuzzy]

And which should be used marginal or absorption?

 

[rfuzzy]

what about the accounting concept? umm, the machinery one? in which we capitalised cost n charged some to pnl?

substance over form

 

[Sjs1993]

perfect papeerrr

 

[rfuzzy]

And job cost sheet one?

 

[rfuzzy]

And what about effect of debenture on net assets and profit?

 

[rfuzzy]

I mean effect on net current assests

 

[hardik]

Correct. Answer is no effect on GP by cash discount and increase by improved system
As more closing stock will be there which will reduce cost of sales

 

[hardik]

Ratio is most probably going to be GP. as was the only profitablity ratio given

 

[hardik]

Current assets will increase. As bank balance will increase.

 

[123add1]

what did u guys answer for the question in which the net reward to partners was the highest.i answered capital 60k and drawings 30k

 

[hardik]

Answer was C. As fixed capital was high and. Drawings was comparitively low

 

[123add1]

Answer was C. As fixed capital was high and. Drawings was comparitively low

 

[123add1]

any other dificult mcq?

 

[Sjs1993]

And which should be used marginal or absorption?

absorption for stock valuation, marginal for decision making

 

[Sjs1993]

And job cost sheet one?

to be able to quote a price. Option D

 

[hardik]

wat about the debenture 1?? i answered increase in CA and decrease in short term profit as interest will have to be paid and the money obtained from debenture will not be in use immediately.

 

[Sjs1993]

wat about the debenture 1?? i answered increase in CA and decrease in short term profit as interest will have to be paid and the money obtained from debenture will not be in use immediately.

Yes, that's correct

 

[wajiman]

Yes, that's correct

well i think no, as in the short term debentures would increase cash and hence increase the production and revenue of the business, as the interest is usually fixed amount, it will not happen to have a big impact and in short term profits will increase where as in the long term, the firm will have to pay back the debentures and its effect will amortize as time passes increasing expenses and reducing profits