Some Answers to Asked Questions (FRA)

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Hi,<BR><BR>I have just sat the exam..it wasn't to hard..tho i did A'level and attained a B - much could be said for my english tho!<BR><BR>I answered the last journal entry (the credit note) as follows...<BR><BR>The credit note had be entered as a Invoice so that means: <BR><BR>£ 470 - Credited to Purchase Legder Control Account<BR>£ 400 - Debited to Purchases<BR>£ 70 - Debited to VAT<BR><BR>To adjust for this you need to cancel the invoice out and then put it in as a Credit Note<BR><BR>(To Remove from accounts)<BR><BR>£ 470 - Debit to Purchase Ledger Control Account<BR>£ 400 - Credit to Purchases<BR>£ 70 - Credit to VAT<BR><BR>
<BR><BR>(To Enter Credit note)<BR><BR>£ 470 - Debit to Purchase Ledger Control Account<BR>£ 400 - Credit to Purchases<BR>£ 70 - Credit to VAT<BR><BR>So in fact of the matter is as follows in a Journal:<BR><BR>Dr - Purchase Ledger Control Account £940 (470+470)<BR><BR> Cr - Purchases £800 (400+400)<BR><BR> Cr - VAT £140 (70+70)<BR><BR>If this is wrong please feel free to tell me...<BR><BR>The Net Profit Figure came in around the £103000 mark (cant remember exactly)<BR><BR>The Bal Fig in the B/S was about £211050<BR><BR>Made up of :<BR><BR>Capital Account - £50000<BR>Capital Account - £50000<BR>Current Account - £55225<BR>Current Account - £55825<BR><BR>I noticed that the Capital Account (second to last question) the brought down figure was £50600? but it was £50000 in the accounts, dont know if anyone else spotted that?<BR><BR>

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    We were told at the start of the exam that there was an error on the paper and that we had to correct that capital account from £50,600 to £50,000. Bit of a pain if you guys weren't informed about that!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    I sat the exam yesterday and had a complete blank on Goodwill! i may as well never have studied it for what i could remember!, never mind - always june!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    no interest on capital was allowed
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    yea well i made a note to the examiner about this but i still used the 50600
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    Hi, <BR><BR>I'm really pleased to see what you put on the exam paper as my answers were exactly the same! We were advised before the beginning of the exam that the capital figure was wrong in the paper and we had to change it.<BR><BR>Thanks again<BR>Vikki
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    I worked out this figure exactly the way you did yaay! It threw me a bit at first but I just drafted up T-Accounts - Purchase Ledger Control, Purchases, VAT and Purchase returns<BR><BR>Glad to see my revision paid off on something....lets just pray i got the rest of the exam right!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    sorry Keiran did you credit purchases twice or did you credit purchases and credit purchase RETURNS?<BR><BR>I credited purchases and then opened up a purchase returns in Trial Balance as i didnt think you credited purchases with a credit note<BR><BR>sorry guys if you have now realised an error...!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    <br><br><< <i>sorry Keiran did you credit purchases twice or did you credit purchases and credit purchase RETURNS?<BR><BR>I credited purchases and then opened up a purchase returns in Trial Balance as i didnt think you credited purchases with a credit note<BR><BR>sorry guys if you have now realised an error...!</i> >><br><br><BR><BR>Are you sure 100% you got the right answer? Or we should stick to the TB accounts ( chart of accounts ) as much as we could?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    I was taught by both my boss and tutor that if an account needs opening, then we should open one.<BR><BR>I opened a purchase returns account on the journal and TB because the credit note related to items returned, therefore it is Purchase Returns Day Book ( remember books of prime entry).<BR><BR>Did anyone else do this?<BR><BR>Michelle
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    Hi Michelle<BR><BR>Have you checked this with your tutor. or it is just your own gess?<BR><BR>coolhandluke
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    hi<BR><BR>I checked it with my tutor and also my boss who is a FD and has a degree in accounts<BR><BR>
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    I cannot argue with that,<BR><BR>Michelle you are right...Credit note Received -> recorded in the RETURNS OUTWARDS DAY BOOK -> Dr Customer -> Cr Returns Outwards<BR><BR>so it was as follows<BR><BR>Cr Purchase - £ 400<BR><BR>Cr Returns In - £ 400<BR><BR>Dr - Purchases LCA - £ 970<BR><BR>Cr - VAT - £ 140<BR><BR>regards<BR><BR>Keiron
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    sorry Keiron but isnt it credit returns out because returns in are goods sold to customers and then returned<BR><BR>Michelle<BR><BR>
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    Yea sorry, if you look at the explination given towards the top, i have done it right!<BR><BR>I was half knackered at the time of posting!!<BR><BR>Lol<BR><BR>Regards<BR><BR>Keiron
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    No worries Keiron!!<BR><BR>Have you completed the Costings or are you doing that in June? If so I dont suppose you know the date do you?<BR><BR>
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Some Answers to Asked Questions (FRA)

    <BR>As far as I know the costing exam is on Monday the 13th June.<BR><BR>Looking at the above posts regarding purchase returns, you can either credit purchases or credit purchase returns. Doesn't make much odds really.<BR><BR>Except when you are like me and forget to do either.<BR><BR>Cheers<BR><BR>Anne

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