› › ›

Statement of Financial Position HELP!

Mollypod88Mollypod88 Well-KnownPosts: 155Registered
in AAT Level 3 (Level 6 in Scotland)
When completing a Statement of Financial Position is there a certain way you have to lay our Current Assets and Liabilities?

Thank you!!
· Share on Google+

Comments

  • MarkTMarkT Trusted Regular Posts: 302Registered
    Assets & Liabilities have to be placed in their order of liquidity.

    Assets:

    Start with the least downwards

    Stock
    SLCA
    Prepayments
    Bank
    Cash

    Liabilities

    PLCA
    Bank (overdraft)
    Accrual
    VAT

    This is the usual order :001_smile:
    · Share on Google+
  • Mollypod88Mollypod88 Well-Known Posts: 155Registered
    Sorry I'm having a really stupid day today :huh:

    What does order of liquidity mean?
    · Share on Google+
  • KaySarahKaySarah Well-Known Posts: 215Registered
    Mollypod88 wrote: »
    Sorry I'm having a really stupid day today :huh:

    What does order of liquidity mean?

    How "LIQUID" they are (how much money they have) ... when one goes Into Liquidation it is because they have no money.
    · Share on Google+
  • crispycrispy Trusted Regular SouthamptonPosts: 454Registered
    As above - liquidity, how quickly/readily an item can be converted back into cash. Eg. stock has to be sold first, so is the least liquid, cash at bank most liquid (as it is cash).
    · Share on Google+
  • Mollypod88Mollypod88 Well-Known Posts: 155Registered
    Thanks everyone :laugh:
    · Share on Google+
  • YaziYazi Well-Known Posts: 225Registered
    I remember Assets like this : Sit Down Pretty Black Cat.....

    Stock = Sit
    SLCA = Down (Debtors)
    Prepayments = Pretty
    Bank = Black
    Cash = Cat
    rodgerss
    · Share on Google+
  • SarahJSSarahJS Trusted Regular Posts: 273Registered
    I'm not 100% sure, but for the exams I don't think it matters (obviously best practice for real life though!).

    I'm sure I even saw balance c/d not at the end of the account in the solutions for an AP2 question (a find the missing balance one).
    · Share on Google+
  • MarkTMarkT Trusted Regular Posts: 302Registered
    Yazi wrote: »
    I remember Assets like this : Sit Down Pretty Black Cat.....

    Stock = Sit
    SLCA = Down (Debtors)
    Prepayments = Pretty
    Bank = Black
    Cash = Cat
    Thats a pretty clever little tip - will remember that for future
    SarahJS wrote: »
    I'm not 100% sure, but for the exams I don't think it matters (obviously best practice for real life though!).

    I'm sure I even saw balance c/d not at the end of the account in the solutions for an AP2 question (a find the missing balance one).

    It matters, trust me - you may collect points for getting the correct answer, but you can also lose them for a failure in method.

    AFAIK, there are three areas of marking, I may be wrong :blush: Calculation, Method and Fundamental - please someone correct me if I am wrong on these points
    rodgerss
    · Share on Google+
Sign In or Register to comment.