fra dec 2005 paper please help needed

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Help needed.

I am on task 2.1,C Sam jams part ex-changed his business vechicle. when i put all the adjustments in the adjustment column i am 10,000 out on the credit side, the answer has got 10,000 and 12,000 on the credit side in vehicle at cost but i only have 12,000 in it could some one explain where the other 10,000 came from. im really confused, and feeling really stressed ive been okay with the other past papers untill i started this one im finding it really hard.

Please help :(
aly

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:fra dec 2005 paper please help needed

    Did it come from the bank account?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:fra dec 2005 paper please help needed

    13500 on the cr side
    10000 is new vehicle
    3500 is part ex allowance

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:fra dec 2005 paper please help needed

    12000 on the dr is to 'eliminate' the original cost
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:fra dec 2005 paper please help needed

    Ps. sorry think iv got my CRs n DRs back2front lol
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:fra dec 2005 paper please help needed

    Hi - I thought that I was the only one struggling with this! It seemed logical to me that the extra £10,000, which in the answer paper has been posted to the credit side of the vehicles at cost account, should have been posted to Bank as this is where the money has come from?? Getting so confused now!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:fra dec 2005 paper please help needed

    me too stucked in this task.

    £10000 should not be in the debit side of vehicle a/c and credited to the bank?

    why is in the credit side of the vehicle a/c instead?

    I've always seen in the Asset a/c :
    debit side :

    -balance at cost
    -cash paid
    -part exchange

    and in the credit side only disposal!!

    :? any help??
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:fra dec 2005 paper please help needed

    Hi

    I thought it was only me that couldnt do it glad some else find it hard. because im a mature student i thought i was going mad and missing something, glad to know im not. Not looking forward to this exam tomorrow,

    Aly :x
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:fra dec 2005 paper please help needed

    This is what my tutor said about this task, hope it helps!

    [i]Yes, this is a little strange what the AAT have done here.
    You are told in the information that 'the amount was credited to the bank account and debited to the vehicles at cost account'. Therefore, for this particular entry, it has already been done.

    Therefore, we only actually need to include the 3,500 part exchange in the cost account (as the 10,000 has already been done). This would give the same net effect as what has been done in the answer, although instead of doing what I did (of just putting in the 3,500), what they have done is to include the full 13,500 again and to net it off with a 10,000 entry on the credit side in order to cancel out the entry has already taken place.
    Either method is acceptable. This was a difficult AAT question, as it didn't make it totally clear what entries had definitely already been made or not.    [/i]
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:fra dec 2005 paper please help needed

    Thanks for that it makes sense now. I just hope nothing like that will come up in the exam tomorrow.

    Aly
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:fra dec 2005 paper please help needed

    Thanks for your help - you've put my mind at rest! Fingers crossed there's nothing like that on the exam tomorrow. :shock:

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