• We need your support!

    We are currently struggling to cover the operational costs of Xtremepapers, as a result we might have to shut this website down. Please donate if we have helped you and help make a difference in other students' lives!
    Click here to Donate Now (View Announcement)

ACCOUNTING paper 2.

Z

ZEEROOO

Messages
56
Reaction score
0
Points
0
Hey guys,
So we have accounts the day after tomorrow. I need some help on those formats and stuff.
Is there anything like BOOKLETS for accounting where i can revise all those stuff? With those definitions?
Im glad if anyone could provide me with accounting notes or any booklets

peace :roll:
 
A

abc123

Messages
215
Reaction score
0
Points
0
Go through frankwood for the theory part especially for provision for bad debts and depreciation, accounting concepts accounting ratios, limited companies international accounting standards, ethics, ICT. The theoreotical questions usually come from these topics.
 
adnanj

adnanj

Messages
290
Reaction score
1
Points
26
ZEEROOO said:
Oh, okeh. So no booklets in the internet for accounts?
Click to expand...
i'll give u the notes tomorrow.. right now i am busy with chemistry preparation.. i have paper tomorrow... :)
 
R

rafae

Messages
339
Reaction score
7
Points
0
Focus on later papers, from 2007-2010.
Make sure to rata-o-fy ALL the theory in the marking keys.
There is going to be PLENTY of theory in this paper 2.
And lastly, have a glimpse at the formats.
Furthermore, remember Payroll and ICT and Goodwill. These 3 topics are relatively newer topics, that will be on the top list of examiner's.
 
A

abc123

Messages
215
Reaction score
0
Points
0
rafae said:
Focus on later papers, from 2007-2010.
Make sure to rata-o-fy ALL the theory in the marking keys.
There is going to be PLENTY of theory in this paper 2.
And lastly, have a glimpse at the formats.
Furthermore, remember Payroll and ICT and Goodwill. These 3 topics are relatively newer topics, that will be on the top list of examiner's.
Click to expand...

i think the only chance of goodwill coming is in the final ac question if it is on partnership and its been there for ages.
 
I

ibadsiddiqi

Messages
737
Reaction score
127
Points
53
I love partnerships..anyways, you guys know that the terms for somethings have changed right? e.g Profit And Loss account is now called the income statement, crediters are now called trade payables and debtors, trade recievables, capital is now equity etc etc. They gave these new terms in the June and Nov 2010 papers along with the old terms in brackets but i heard that they wont givre the old terms anymore. So i guess you should know the new terms.
Anyways if anyone has any questions or queries then do post them :p
 
I

ibadsiddiqi

Messages
737
Reaction score
127
Points
53
Hey every one! My teacher thinks that Manufacturing Account is very likely to come as the last question where you have to prepare the financial statements. Do ratio analysis also. Limited company and incomplete records and single entry both have come in June and November 2010 in detail so i wouldnt waste much time on them, just go through them. I think control accounts and bank reconciliation statements will definetely come. Anyways concentrate more on theory topics like international accounting standards and professional ethics etc etc. Also do depreciation. Thats all i think..
 
Z

ZEEROOO

Messages
56
Reaction score
0
Points
0
abc123 said:
rafae said:
Focus on later papers, from 2007-2010.
Make sure to rata-o-fy ALL the theory in the marking keys.
There is going to be PLENTY of theory in this paper 2.
And lastly, have a glimpse at the formats.
Furthermore, remember Payroll and ICT and Goodwill. These 3 topics are relatively newer topics, that will be on the top list of examiner's.
Click to expand...

i think the only chance of goodwill coming is in the final ac question if it is on partnership and its been there for ages.
Click to expand...

Hey man, can you tell me about this goodwill thing on final questions?
I don't get what you tell..Can you tell me the past papers where a similar questions have come..?
And what else will come on goodwill, please need some help on those^^

and btw, not to forget all those helps given above^^^^ thanks!
 
R

rafae

Messages
339
Reaction score
7
Points
0
Goodwill is the value of a business over and above its tangible or net assets.
So basically, an example of goodwill is: reputation.
For example, when you want to go with a friend to have lunch, will you go to McDonalds or some guy selling pakoras on the street? Obviously Mcdonalds right? Well why is that? That's because McDonalds has a better reputation right? Basically, this "reputation" is an example of Goodwill. It cannot be seen or touched, but it can be measured in a monetary value. In the context of my example, goodwill would be the value of McDonald's reputation. However, reputation is only one example of Goodwill, there are several others.

Secondly, there is a formula for goodwill.

GoodWill= Purchase Consideration - Net assets taken over

Purchase consideration is the amount you purchase another business for. Net assets taken over are the net assets that you take over of another business' for.

Another treatment of goodwill is this.

X and Y amalgate their businesses, and decide to share profits and losses in the ratio 2:1 respectively.
Y has a Goodwill of $3000. How will this be posted to the accounts?

Debit: Goodwill $3000
- Credit: Capital Account X- $2000
- Capital Account Y- $1000


Good will is also added to the balance sheet, before the Fixed Assets section.

I hoped I explained this well.
 
adnanj

adnanj

Messages
290
Reaction score
1
Points
26
Rafae r u sure it will be posted this way?? I mean i thought it had to be just credited to Y's account..
coz it was his goodwill..??
 
A

abc123

Messages
215
Reaction score
0
Points
0
rafae this is wrong. when goodwill is created it is in the old profit sharing ratios so it will just be credited y's account.

For goodwill there are two ways to record it:
1.an account is opened and it is kept on the books. When this happens you also include goodwill on the balance sheet
2.an account can be opened up to record it but it is immediately written off. When this occurs you do not include goodwill on the balance sheet

Entries for goodwill:
1. To create goodwill debit the goodwill account and credit the capital accounts. (this is done in the old profit sharing ratio)
2. To write off goodwill credit the goodwill accound and debit the partners accounts. (this is done in the new profit sharing ratio)

Practise june 2010 paper and 2002. They will clear up all the confusion on goodwill
 
adnanj

adnanj

Messages
290
Reaction score
1
Points
26
abc123 said:
rafae this is wrong. when goodwill is created it is in the old profit sharing ratios so it will just be credited y's account.

For goodwill there are two ways to record it:
1.an account is opened and it is kept on the books. When this happens you also include goodwill on the balance sheet
2.an account can be opened up to record it but it is immediately written off. When this occurs you do not include goodwill on the balance sheet

Entries for goodwill:
1. To create goodwill debit the goodwill account and credit the capital accounts. (this is done in the old profit sharing ratio)
2. To write off goodwill credit the goodwill accound and debit the partners accounts. (this is done in the new profit sharing ratio)

Practise june 2010 paper and 2002. They will clear up all the confusion on goodwill
Click to expand...


To create goodwill, it is done in the ratio of goodwill each partner has brought in..
 
You must log in or register to reply here.
Top