Prepare final accounts for sole traders and partnerships - Assessment 2

AccountsFury5

Hello,

I've been having some difficulty with this exam, As It keeps changing i get new question but it seems every time I resit it, It's so much harder:

A contra entry, I know it goes on a debit side of the Purchase ledger control but what does it go under as i've been told as contra itself or set off but none of those came up? also In my exam it was completely different from what i usually revise off, It had non current assets and contra in the description bit below the tables and more stuff which was just as confusing. can anyone recommend anything to revise off that covers everything? so i get no hidden suprises, I've tried AAT itself (both questions but I've done them so many times I know the answers without reading the question)and Osborne books.

but on Assessment 2

on question task 1.2b)

I have an idea and the answer is 55,000. I'm not sure if i'm doing this right, Do i always divide it by 6?

On question task 1.4c))

I don't fully understand appropriations, I always seem to get it wrong in the exam. If someone could explain it'd be so useful.

In my actual exam I had been given something similar to this but It was to work out Asma only, work out her salary, interest on capital and her share and then work solely on her current account.

Thank for taking the time read this!

RJD

Hello,

I am studying this unit aswell and have found with this and other units that some questions aren't covered in the osbourne books but they tend to be only a mark or two and I think they are designed to test your understanding rather than just what you can remember from the books. Do you have a tutor? It can be really useful in these circumstances to give them a ring and they will talk you through it. If don't know the answer its best just to move on because they are usually only a couple of marks.

With regards to the contra entry I would put it under Sales Ledger Control Account because that is the other account involved in the entry.

1.2b) you are correct that this is 55000 but it won't always be the same calculation, it depends on the margin/mark up.
When its a margin sales = 100% and cost of sales = 100% - the margin. So if the margin was 30% then the cost of sales would be 70% of the sales.
If its a mark up then the sales percentage is 100% + the markup so in this question 66000 is 120% of the cost of sales so the answer is 66000/120 x 100 or /6 x 5 as you said.

1.4c) With appropriations you start with the net profit then you have to take off salaries and interest on capital and divide the remaining amount between the partners. The question will often have a partner joining part way through the year. In this case it is important to remember that salaries and interest on capital are accrued evenly throughout the year but profit is not.
When entering the figures in the partners current accounts, just remember that anything the business owes to the partner is a credit (salaries, interest on capital and share of profits) and anything the partner has taken out of the business is a debit ie. drawings.

Hope this helps

AccountsFury5

Thank you for your response, yeah i do have a tutor i will try to get more information on Monday! However i just need to pratice and keep at it, thank you for helping it helped alot :-)