Financial statements help

Hi guys
Fully aware that I probably ask too many questions on here but I am in need of help so thought I can only ask. I have just gone through the 2010 practice assessment and had the following problems. Would be grateful if anyone could explain how to work out the following questions as I am not getting the correct answers and as I think there are a lot of areas to lose marks on this paper I need to try and understand as much as I can (which I would want to anyway but esp on this exam).
My first confusion came in question 1 (not a great start) when there was a prepayment applied to the distribution costs of an advertising contract to be run over the following 3 months. I could just be not thinking correctly as we did these at the beginning of the year but why here?
The second and third are both on 1.4
A company has 3 different products in its inventories, the following information applies
Product......Costs incurred to date.........Estimated costs of completion......Expected selling price
1..................£400................................£180............................................£562
2..................£572................................£210............................................£798
3..................£615................................£713............................................£762
The answer to this is £1,543, I worked it out to a completely different figure, not sure if I'm not understanding the question or i am completely out.
In July 2010 Foxtrot revalued a piece of land from a cost of £400,000 to it's market value of £700,000. In July 2013 due to a decline in the property market, the market value of the land fell to £340,000. How much of the impairment loss should be recognised in the comprehensive income in the company's SOCI for the year ended 31 December 2013. I thought the full difference of £360,000 but the actual answer is £300,000.
Sorry for all the questions but thanks in advance for any help you may have. Not feeling very confident for this exam but I have about 4 weeks until I take it so there's time to go over things and try and get my head around different standards etc.
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Fully aware that I probably ask too many questions on here but I am in need of help so thought I can only ask. I have just gone through the 2010 practice assessment and had the following problems. Would be grateful if anyone could explain how to work out the following questions as I am not getting the correct answers and as I think there are a lot of areas to lose marks on this paper I need to try and understand as much as I can (which I would want to anyway but esp on this exam).
My first confusion came in question 1 (not a great start) when there was a prepayment applied to the distribution costs of an advertising contract to be run over the following 3 months. I could just be not thinking correctly as we did these at the beginning of the year but why here?
The second and third are both on 1.4
A company has 3 different products in its inventories, the following information applies
Product......Costs incurred to date.........Estimated costs of completion......Expected selling price
1..................£400................................£180............................................£562
2..................£572................................£210............................................£798
3..................£615................................£713............................................£762
The answer to this is £1,543, I worked it out to a completely different figure, not sure if I'm not understanding the question or i am completely out.
In July 2010 Foxtrot revalued a piece of land from a cost of £400,000 to it's market value of £700,000. In July 2013 due to a decline in the property market, the market value of the land fell to £340,000. How much of the impairment loss should be recognised in the comprehensive income in the company's SOCI for the year ended 31 December 2013. I thought the full difference of £360,000 but the actual answer is £300,000.
Sorry for all the questions but thanks in advance for any help you may have. Not feeling very confident for this exam but I have about 4 weeks until I take it so there's time to go over things and try and get my head around different standards etc.
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0
Comments
You've copied the question down wrong here, it's £173 costs of completion not £713.
It's valued at lower of cost and NRV (which is selling price less costs of completion).
So product 1 is £382 (£562-£180)
Product 2 is £572 (this is lower than NRV which is £588)
product 3 is £589 (£762-£713)
Totalling £1543.
Hope this helps. In my exam I had a long written question on inventories so hoping I explained that properly as I haven't had my results yet.
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