Could someone assit on this Cash Managment question please?

topcat
topcat Registered Posts: 452
in AAT Level 3 (Level 6 in Scotland)
IGngU.jpg

the answer is £21730

which is 142400-8900 =133500
155230-133500 = 21730

but why is the depreciation being taken of the open balance when the question states "incomes for this three month period" surely it should be taken of the closing ?:001_unsure:

Comments

  • Nps
    Nps Registered Posts: 782
    But you get the same answer either way.

    You are right in what you are saying, the depreciation charge comes off during the period, not at the start, but the end result is the same. Its just an example of different calculations looking different but actually saying the same.

    Personally, my calculation would be 155230-142400 to give the total increase in PPE over the period. I would then add on the depreciation charge as we are told that that amount has already been included in the figures above so we need to add that value on to get the total amount spent.
  • crispy
    crispy Registered Posts: 467 Dedicated contributor 🦉
    Hello,

    I would of looked at it as:-

    PP&E @ 31/3: 155,230
    PP&E @ 1/1: (142,400)
    Depn Chg: 8,900
    Additions: 21,730

    It is simply what you had at 31/3 less your opening at 1/1 - and adding back the depreciation charge (as it is a non-cash expense).
  • topcat
    topcat Registered Posts: 452
    thank you both think I have got it now, really dislike this questions though !haha
  • Clintm15
    Clintm15 Registered Posts: 248 Dedicated contributor 🦉
    I agree with you Topcat. Logically I don't like it formatted like this either.
    AAT
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    F4 - Corporate Law - Dec 2015 (passed)
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  • lisa123
    lisa123 Registered Posts: 5 New contributor 🐸
    hello,
    This may sound a silly question.
    I have recently started studying AAT and I will be taking my 1st exam in 2 weeks time. I will be sitting the Cash Management exam. I was wondering (as I am new to this) what is provided in the CBA exam, i.e. something to scribble workings on?
    Thanks
    Lisa
  • steve2008
    steve2008 Registered Posts: 89 Epic contributor 🐘
    Check with your exam center.

    Mine provides paper, and I need to take my own calculator (non-programmable) and pen.

    I think the vast majority of centers provide paper for workings.
  • kewko
    kewko Registered Posts: 11 Regular contributor ⭐
    lisa123 wrote: »
    hello,
    This may sound a silly question.
    I have recently started studying AAT and I will be taking my 1st exam in 2 weeks time. I will be sitting the Cash Management exam. I was wondering (as I am new to this) what is provided in the CBA exam, i.e. something to scribble workings on?
    Thanks
    Lisa

    Hi,

    There should be scrap paper provided, you may need to ask in the exam. Check with your exam center tho.

    Jason

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