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Economics, Accounting & Business: Post your doubts here!

student92

student92

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the partnership act 1890 says that no interest should be chaged on drawings and interest, and profits to be hsared equally and interst on loan by partner to be 5%
so, the operating profit and bank interest are not going to be effected, so start your answers using it
the appropriation of the profit between the partners will be changed.
i recommend you go throught the parntership chapter in the CIE book, it will help a lot
 
S

sunny987

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Okay thankyou. And can you please tell me how to find the drawings in the b part?
student92 said:
the partnership act 1890 says that no interest should be chaged on drawings and interest, and profits to be hsared equally and interst on loan by partner to be 5%
so, the operating profit and bank interest are not going to be effected, so start your answers using it
the appropriation of the profit between the partners will be changed.
i recommend you go throught the parntership chapter in the CIE book, it will help a lot
Click to expand...
 
student92

student92

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you can make a t account of their current accounts to get the figure for drawings
for H
we know pfofit share is 41500 salary is 18 000 and interest on capital is 5000 and the balance brought down will be 3500
so it means (41500+5000+18000) -3500 =61 000 drawings
 
student92

student92

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hasano5 said:
hello,
thanks for making this great thread.
I have a doubt in accounting may/june 2011 paper 4 variant 1 question 3 (a) http://papers.xtremepapers.com/CIE/Cambridge International A and AS Level/Accounting (9706)/9706_s11_qp_41.pdf. I understood how the sales, expenses and other items have been calculated but I am confused about how the purchases is calculated. In the marking scheme, they add 75, which is the opening trade payables, to the total purchases, 680. In the end they subtract the closing trade payable but I am confused about how they got 90 as the closing trade payables. It would be great if someone explains to me the procedure and thanks :).
Click to expand...

hi
the question says that purchases are paid after 1 and a half month of them being received.
so this means, straightaway that the purchases in April are not going to b paid by 30 April and will be therefore taken as creditors
plus, march purchases will also be not paid for
suppose, purchases are received at 1march, so 30 march is one moth, +15 days is 15 april, that means they will be paid by 30 april the year end
however, purchases received after 15 march, will not be paid by 30 April,
therefore we have to split march purchases into half, and add the whole purchases of April to get the closing of creditors
thats 60+30=90
Purchases accrue evenly over the month
this is the main point in the question, which makes us do all this diving up the sales of march into half
at first, even i thought, that the purchases made at 1 march, will be paid by 15 april, so it should not be included in the closing creditors, but its due to this written in the q, we have to do this.
its not like the business pays in lump sum amounts, at the end of the month. Purchase are made evenly, so they are paid out after 1.5 months of them being revived

feel free to ask me if you could not understand my explanation
 
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vineeth jain

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ZainNadeem said:
View attachment 24266View attachment 24266View attachment 24266 Anyone pls help me with this question of Capital Redemption Reserve.
Why will the answer be A ??
Capital RR should only include the amount not covered by the new issue of shares which should be 100,000 but the answer shows 25,000...
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crr rule: create crr at an amount equal to Nominal value of shares being redeemed less total proceeds from new issue
in this case the nominal value is 1 * 200,000 = 200000
and total proceeds from new issue(including premium or discount) = 2 * 50,000 + 1.5 * 50,000 = 175000
therefore the crr balance will be 25ooo
hope you understood.. :)
 
Esme

Esme

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Alice123 said:
What AS chapters do we need fr a2 accounting????
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Partnership changes, manufacturing accounts, non-profit making organisations and incomplete records. Everything in limited company accounts, interpretation and analysis, and also costing. These are the important topics I think, cuz there are questions in the past papers related to these.. Apart from this refer to the syllabus maybe that'll help
 
WayneRooney10

WayneRooney10

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(The past papers section isn't working right now so can't post a link) November 2011, P42, Q2. Why aren't dividends paid shown in the income statement? Thanks!
 
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