David Nix Practice Exam Unit 5

jewels.pjewels.p Font Of All KnowledgePosts: 1,774Registered
Hi,

Can anyone help me please. I have just started the David Nix Practice Exam and am on Task 1 and stuck already!:thumbdown:

It asks you to calculate Total Sales for the year ended 31/5/04.

Cash is banked at end of the day except a float of £100 kept in the till. During the year cash payments were made from the till before banking:
General Expenses - £2150
Wages - £1900

£89750 is showing in the Bank Account as being transferred from Cash Account

I got £93700 but am unsure!:001_unsure:

Help!

Comments

  • burgburg Experienced Mentor GloucesterPosts: 1,440Moderator, FMAAT, AAT Licensed Accountant
    Draw up a cash account

    Don't forget the float is an opening and closing balance. (based on your wording of the question)

    The items mentioned are all paid out of cash so sales is the balancing figure.

    P.S. you are close!
    Regards,

    Burg
  • jewels.pjewels.p Font Of All Knowledge Posts: 1,774Registered
    Hi,

    Yeah I had drawn up a Cash Account but put £89750 as the opening balance instead of the £100 duh!

    So now my Sales Figure is £93800 Am I right now?

    Thanks for your help

    Julie:001_smile:
  • burgburg Experienced Mentor GloucesterPosts: 1,440Moderator, FMAAT, AAT Licensed Accountant
    Yeah you are right, well done.

    Didn't want to just give you the answer.

    Best of luck with the rest of the studies!
    Regards,

    Burg
  • jewels.pjewels.p Font Of All Knowledge Posts: 1,774Registered
    I cant believe this I am now on Task 1.2 and stuck!:blushing:

    It asks you to calculate the gross profit for the year ended 31 May 2004.

    How can I do this without total purchases, closing stock etc. They are to be calculated in later tasks!

    I thought Gross Profit was calculated as Sales - Costs of Sales.

    Only two questions in and I am struggling this is not a good sign!:thumbdown:
  • mikesmikes Trusted Regular Posts: 254Registered
    Hi Jewels,

    On the other information given, the proft margin on sales is 1/3rd or 33%. This is taken from the sales figure to give the gross profit.

    Regards

    Mike.
  • jewels.pjewels.p Font Of All Knowledge Posts: 1,774Registered
    Hi Mike,

    Thanks for that. If that had been in the exam I would have been totally wrong as never come across that before but now you tell me it's easy to see thats how to calculate it. First TWO questions and had problems with both. Feeling totally thick today! :blushing:

    Think I'll give up on this today and carry on tomorrow maybe my brain will be switched on then.

    Thanks again for your help

    Regards

    Julie:001_smile:
  • mikesmikes Trusted Regular Posts: 254Registered
    Don't worry, i am sure that you are doing excellent. I didn't do this one myself, only the first paper. I gave up on this one, i went to the previous papers on the website instead. Most of these questions are covered in chapter 12 or 13 in the workbook, have another look at that again before having another go at the paper. I was struggling in getting used to all the different formulas etc, when i was learning the topic.

    Let us know if you need any more help.

    Regards

    Mike.
  • SallySally Feels At Home Posts: 69Registered
    Hi there

    I have also just done this Practice Exam 2 (David Nix)Task 1.1 and had sales at 93900. As it was the first year of trading would he have an opening balance on the cash account? I thought i was doing ok and now im really confused again?? Have you seen the answer to this question?
  • jewels.pjewels.p Font Of All Knowledge Posts: 1,774Registered
    Hi Sally,

    I havent seen the answers and like you had £93900 first but think the £93800figure is correct as the £100 was probably put in the till when the business started (I could be wrong though)

    I am only on Task 4 and have been stuck on every task so far!:thumbdown: Not a good sign.

    Can anyone tell me if £5874 is the correct answer for the closing stock figure as I had an answer of -12766 before and even I know that wouldnt be right!:laugh:

    Julie:001_smile:
  • SallySally Feels At Home Posts: 69Registered
    Hi Julie

    I have Task 1.4 - closing stock as 6120 although i am not very confident and am off to check all my answers now. I think we are being given the answers to all five practice exams tomorrow so will let you know the answer
    if i get it. Everytime i think i have grasped something another consideration pops up and im back to square one again!!
  • SallySally Feels At Home Posts: 69Registered
    Hi Julie

    have just changed my sales figure to 93800 and now get a closing stock figure of 6187?! (GP 31267, cost of sales 62533 & purchases 68720)

    Im dreading June exams!!!!!!
  • RichardRichard Trusted Regular Posts: 373Registered
    I would keep your sales figure as 93,900 as there would not have been an opening balance if it was his first year of trading.

    Keeping it at this figure also makes the answers to the questions that follow, 'round' numbers.

    When I did FRA, I read the examiners comments that in the exams you will always have nice round numbers for answers, this helps you spot that you are going wrong somewhere!! I'm not sure if this is still the case.
  • jewels.pjewels.p Font Of All Knowledge Posts: 1,774Registered
    Richard wrote: »
    I would keep your sales figure as 93,900 as there would not have been an opening balance if it was his first year of trading.

    Keeping it at this figure also makes the answers to the questions that follow, 'round' numbers.

    When I did FRA, I read the examiners comments that in the exams you will always have nice round numbers for answers, this helps you spot that you are going wrong somewhere!! I'm not sure if this is still the case.

    Oh No just read this and now stuck all over again. On Task 2.2 when doing the P & L Account I got the Net Profit as £39,990 but thought at the time it was more likely to be £40,000 so I checked and checked my figures but couldnt find the £10 difference anywhere so I left it at £39,990:crying:
  • jewels.pjewels.p Font Of All Knowledge Posts: 1,774Registered
    Sally wrote: »
    Hi Julie

    have just changed my sales figure to 93800 and now get a closing stock figure of 6187?! (GP 31267, cost of sales 62533 & purchases 68720)

    Im dreading June exams!!!!!!

    If you've changed your Sales Figure to 93800 where do you get the GP as 31267 from? I calculated it as 93800 x 33% = 30954!:laugh:

    Way hay we both got the same figure for Purchases (We must be doing something right:thumbup1:)

    My cost of sales figure came from Sales - 93800 less GP - 30954 = 62846

    Let me know when you get the answers! I am dreading the exams as well! I was laughing when I read your message but wont be laughing in June!

    Julie:001_smile:
  • RichardRichard Trusted Regular Posts: 373Registered
    jewels.p wrote: »
    If you've changed your Sales Figure to 93800 where do you get the GP as 31267 from? I calculated it as 93800 x 33% = 30954!:laugh:

    Way hay we both got the same figure for Purchases (We must be doing something right:thumbup1:)

    My cost of sales figure came from Sales - 93800 less GP - 30954 = 62846

    Let me know when you get the answers! I am dreading the exams as well! I was laughing when I read your message but wont be laughing in June!

    Julie:001_smile:

    A sales figure of 93,900 would give you a gross profit of £31,300 (93,900 / 3) - be careful of using 33%, as this isn't an exact third.
  • SallySally Feels At Home Posts: 69Registered
    Hi Julie

    We were given the answers today - Sales are 93900 (no opening cash balance). I did mention the '£100 in the till theory' and was told that that would be the case in practice but not to assume anything in the exams - go with what we are told. The Closing stock is 6120 .

    Good luck!
  • jewels.pjewels.p Font Of All Knowledge Posts: 1,774Registered
    Sally wrote: »
    Hi Julie

    We were given the answers today - Sales are 93900 (no opening cash balance). I did mention the '£100 in the till theory' and was told that that would be the case in practice but not to assume anything in the exams - go with what we are told. The Closing stock is 6120 .

    Good luck!

    Sorry Sally you had 6120 in the first place I mustave just totally confused you with my calculations!:001_wub:
  • meibakermeibaker Trusted Regular Posts: 481Registered
    jewels.p wrote: »
    Oh No just read this and now stuck all over again. On Task 2.2 when doing the P & L Account I got the Net Profit as £39,990 but thought at the time it was more likely to be £40,000 so I checked and checked my figures but couldnt find the £10 difference anywhere so I left it at £39,990:crying:

    mine net profit is 48,793. what closing stock figure did you use in your P&L a/c? i use the trial balance figure, not sure need to adjusted or not.
  • jewels.pjewels.p Font Of All Knowledge Posts: 1,774Registered
    meibaker wrote: »
    mine net profit is 48,793. what closing stock figure did you use in your P&L a/c? i use the trial balance figure, not sure need to adjusted or not.

    I used Closing Stock figure of 55580 as you need to adjust figures before doing your P & L

    Julie:001_smile:
  • maprymapry Settling In Nicely Posts: 15Registered
    hi

    am trying to do that exam it seems to be a good one can someone plz send me a link I can't seem to get the infor but the answers are there wierd!!!
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