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Accounting paper 22 discussions here.

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In Q.1 6 marks was for free...as we have to jst copy pate the cost of sales of Business X and Y then the Interest part we have to jst copy paste and cash equaltiant so 6 marks was free and i will only get these 6 marks in 1st question o_O
 
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Okay, here are my answers. :)
I selected Business Y as computer manufacturer, which I know was wrong, I got Capital employed 1800,000 and 750,000 respectively while sales were 540,000 and 1500,000. Non-current assets had to be found by using working capital and deducting it from Capital employed.

In Question 2, I didn't see that interest was just for 3 months, so I took it whole and got wrong net profit of 18000 instead of 20,000 but that would cause a maximum of 3 marks. Good will was to be credited in the Grosz account but not to be written off. Appropriation account would be correct but I think I'll lose marks in theory as for why good will was arisin.

In Question 3, I got 2200 as break even and then got the Margin of safety in revenue. The total material was coming 48000 metres and the profit was coming $52,800. Examiner might deduct 1 or 2 in the last part but that's unlikely because I mentioned that different profits are reported due to change in inventory level as in Marginal costing, inventory is treated as period cost while in absorptional, it's treated as unit cost.
how many marks will be deducted for adding loan figures to capital employed and then getting wrong non current assets and for not showing workings?
 
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In Q.1 6 marks was for free...as we have to jst copy pate the cost of sales of Business X and Y then the Interest part we have to jst copy paste and cash equaltiant so 6 marks was free and i will only get these 6 marks in 1st question o_O
Which interest? o_O
 
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What was your answer on the first question guys?
State and explain which business is the computer manufacturer and which is the food wholesaler?
 
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No, that's because the question didn't say so, though IAS says that internally generated good will should not be recorded due to subjectivity and objectivity concept, but CIE doesn't get the point!
well the qs was for 7 mks.. they wont give u 7 mks for just copying figs..;)
 
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Theyll give you marks if you carried forward a wrong figure but did the right method.
Are sure about it. cause this would mean i would loose only 3 to 5 marks n get full in the rest of the questions even i used wrong profit?
 
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Are sure about it. cause this would mean i would loose only 3 to 5 marks n get full in the rest of the questions even i used wrong profit?
Yeah check it out in the mark schemes of past papers, they provide 1OF.
 
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well the qs was for 7 mks.. they wont give u 7 mks for just copying figs..;)
True that, but I've done this kind of question before, and I did write off the good will, but it in the Marking scheme, it wasn't written off. I'll try to find that paper.
 
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how many marks will be deducted for adding loan figures to capital employed and then getting wrong non current assets and for not showing workings?
Loan had to be added to the capital to give capital employed. I don't know, I guess couple of marks?
 
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Me too :) Btw if your corrected net profit is wrong, you will get wrong b/d of capital in it's next part and then you will get wrong int on capital in appropriation account? No part was independent :/
Error carried forward, my friend.
 
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acc. to prudence and IAS u should..:p so when u had 7 mks and valid accnting reason for it.. y not?..;)
You're definetly correct, it should be written off, but if you see the questions of partnership, you'll notice how it's written to write off the good will. :) In this question, it wasn't. And when I asked my sir, he told me I did correctly, but it's all up to the examiner.
 
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You're definetly correct, it should be written off, but if you see the questions of partnership, you'll notice how it's written to write off the good will. :) In this question, it wasn't. And when I asked my sir, he told me I did correctly, but it's all up to the examiner.
yeah right... ;) examiner should be explicit in qs ..;)
 
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yeah right... ;) examiner should be explicit in qs ..;)
Yeah, he should because it created confusions. The internally generated good will should be written off, in the past however, it was clearly mentioned to write it off but there was nothing mentioned about good will's treatment in the question this year
 
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Yeah, he should because it created confusions. The internally generated good will should be written off, in the past however, it was clearly mentioned to write it off but there was nothing mentioned about good will's treatment in the question this year
it said to prepare the capital accounts immediately after the admission of the partner....i wasnt going to write it off at first but i did, to find out the figure for the interest on capittal.
i just hope its right :\
 
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the priorities in question 3 were apex 1...cord 2 and bond 3 with maximised profit coming 52800.
i did not write off the goodwill since it wasnt mentioned...
loan interest was 1000 and corrected net profit 20000
as for the question why goodwill has arisen....i just winged it and said that the net value of the business is greater then its net assets and good reputation and its a profit generating business.
tell me whats INCORRECT.
the interest on loan was 360 as it was for 4 months only
 
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