Accounting Preparations 2 Failed

Daniel E

Hi there,

I failed the exam for Accounts Preparations 2 the other day and I'm really disappointed as I studied really hard for it. I'd like to try and identify what I got wrong specifically.

I passed;

Accounting for Profit Appropriation in Partnerships & Accounting for Changes in Partnerships.

but failed in;

Financial Statements for Sole Traders

Partnership statement of financial position.

Incomplete records including control accounts

Incomplete record techniques.

The weird thing is it didn't even feel like it was difficult while I was taking it. However, I do remember of few issues that I was unclear about that I'd really appreciate clarification on.

In the income statement exercise there was a row heading titled "other income" I believe after the "Gross Profit". In this row I put "Disposal of Fixed Asset" from the Trial Balance. Was this correct?

Also, in the income statement exercise it mentioned that the business has a policy of including any Sales returns as part of the Sales figure and the same with the Purchases/Purchase Returns. This really threw me. Does this mean you deduct the returns from the sales and purchases figures or not.

Also, in one of the incomplete records exercises, they presented several Assets and Liabilities that you were supposed to use to find the Capital. One of them just said Inventory. I thought this might be a trick question but should I have counted this as an Asset?

Thanks for any help you can provide.

MWAUGH1983

Hey Dan,

Sorry about your news; failing is never a good feeling - I did the old FRA 3 times and then took AP I in nov and AP II in Jan and past them first time - though it took me 4 times in total to pass the area so I know how you feel!

I am not to sure but I believe that disposal of asset is other income as I think I had that as well and also believe it is in the practice test.

In regards to return figures I feel these are easy marks which at the same time are rather tricky. It says in the question infor that sales and purchase figs do have to include the returns - though you could think this either way - though easy marks is an understatement! I am don't trying to be offensive just in my experience when I have done similar questions you never think of the returns figs! lol

Yeah you would treat the inventory as a non current asset - though I did a question once where it looked at fixed assets and not current so you would have to be careful in that respect.

For the bal sheet question you would have to list assets in the most liquid way.

How are you coming wiht L3 - I have cash mgt, tax and ethics to do - found out today that I past spreadsheets when I did that 2 wks back and I past costing on the old standards.

Cheers
Martin