help needed
lori
Registered Posts: 25 Regular contributor ⭐
i have to complete this for unit 5 additional questions having a mental brain block now after this weeks exams - can anyone advise me how to do them or reword them for me in dummy terms
thanks
Task 6
Orca has 20 pictures in stock at the year end, all of which cost £100. They sell for £250.
a) What should be their valuation in the year end accounts?
b) After 12 months, 16 of the pictures have sold but Orca is keen to shift the remainder and so reduces the selling price to £175. Extra marketing for these pictures costs £20 each. At what valuation should Orca include these pictures in the year end accounts?
c) One picture remains 12 months later. It is slightly damaged and will cost £60 to repair. Orca has reduced the selling price to £125. At what valuation should Orca include this picture in its year end accounts?
Task 12
Close of the following income account at the end of the year.
dr Interest received
Date
2008 Details Amount cr
Date
2008 Details Amount
30 June Bank 230.00
31 Dec Bank 255.00
:confused1::confused1::confused1:
thanks
Task 6
Orca has 20 pictures in stock at the year end, all of which cost £100. They sell for £250.
a) What should be their valuation in the year end accounts?
b) After 12 months, 16 of the pictures have sold but Orca is keen to shift the remainder and so reduces the selling price to £175. Extra marketing for these pictures costs £20 each. At what valuation should Orca include these pictures in the year end accounts?
c) One picture remains 12 months later. It is slightly damaged and will cost £60 to repair. Orca has reduced the selling price to £125. At what valuation should Orca include this picture in its year end accounts?
Task 12
Close of the following income account at the end of the year.
dr Interest received
Date
2008 Details Amount cr
Date
2008 Details Amount
30 June Bank 230.00
31 Dec Bank 255.00
:confused1::confused1::confused1:
0
Comments
-
You value stock for the accounts at the lower of cost or sales price. So you will mainly use cost price as more often than not that is lower than the sales price. However if you have stock thats damaged or is now obsolete you may find the selling price is less than the items actually cost.
Hope that helps:001_smile:0 -
Hello,
Task 6 is regarding stock valuation which should be valued at the 'lower of cost and net realisable value'
A) Cost = £ 100, NRV = £ 250 - Value stock at £100
Cost = £ 100, NRV = £ 155 (175-20) - Value stock at £ 100
C) Cost = £ 100, NRV = £ 65 (125-60) - Value stock at £ 65
Remember NRV results from selling price less any costs to bring the item into a saleable condition.
Task 12 - Not clear of question but the journal for interest received should be: -
Dr Bank
Cr Interest Received
Cr Interest Received0 -
thanks for your help the last question i think is an interested received account and the two entires are on the credit side and the question was close off the account
aaaaaaaaaahhhhhhhhhhhhh0
Categories
- All Categories
- 1.2K Books to buy and sell
- 2.3K General discussion
- 12.5K For AAT students
- 318 NEW! Qualifications 2022
- 161 General Qualifications 2022 discussion
- 11 AAT Level 2 Certificate in Accounting
- 56 AAT Level 3 Diploma in Accounting
- 87 AAT Level 4 Diploma in Professional Accounting
- 8.8K For accounting professionals
- 23 coronavirus (Covid-19)
- 272 VAT
- 92 Software
- 273 Tax
- 135 Bookkeeping
- 7.2K General accounting discussion
- 200 AAT member discussion
- 3.8K For everyone
- 38 AAT news and announcements
- 345 Feedback for AAT
- 2.8K Chat and off-topic discussion
- 582 Job postings
- 16 Who can benefit from AAT?
- 36 Where can AAT take me?
- 42 Getting started with AAT
- 26 Finding an AAT training provider
- 48 Distance learning and other ways to study AAT
- 25 Apprenticeships
- 66 AAT membership