maybe mistake from AAT?

any2002uk

please see the past exam FRA December 2005.

in task 2.1 part (c) it said £10,000 was paid from bank account.Credit to Bank, Debit to cost.

So i put £10,000 in Bank credit columns then check the answer, AAT maybe mistake because the answer sheet did not show any £10,000 in credit of bank. but AAT put them in COST credit of £10,000??????????

i read very careful and put what AAT wrote and still make me loss mark. if i did not see the answer then i assume the bank figure would be £3532-£10,000= overdraw £6468 which i put it in balance sheet under current liabilities!!!!!!!!!! then my balance is not match!

why AAT write that way then do other way.

have you done the same mistake.

AdamR

The 10,000 has already been credited to the Bank account:
"£10,000 was paid from the bank account. The amount was credited to the bank account and debited to the vehicles at cost account."

If you split the journal of £13,500 debit to vehicles at cost in the answers, you see that the £10k just debits and credits the same account, with the £3,500 part-exchange allowance making up the difference.

Hope this helps.

jkc

help

still struggling
why do you need to credit assets with 10000.
there was a debit bal of 22000
then you put the new asset purchase of 13500 on the debit side this was.
10000 from the bank and 3500 P ex
on the other side you take out 12000 for disposal so I got a bal c/d of 23500.
I feel thick help.

any2002uk

i still must put £10,000 in cost account and so that is why AAT always ask to do double entry, i put £10,000 in credit of bank account so they are double entry.

if this question will appear same in next week FRA, i should ignore the word "PAID" so that i don;t need to entry again but the answer sheet said they put £10,000 in cost then double entry on same account, i am sstill confuse.

thanks

AdamR

You don't actually need to put the 10,000 credit in, but like I explained, the debit is effectively in the same account as well. Had I been doing the question I would've just posted £3,500 as a debit to Vehicle Cost; they've debited 13.5K and credited 10k. Net result = same.

Hope this helps.:thumbup1:

Rachey

I also worked on this last night and did it the same as Adam just explained. I just omitted the £10,000 from both sides and got the same answer. Not sure if we'd lose any marks for it, hopefully not!