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Economics, Accounting & Business: Post your doubts here!

student92

student92

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Daffodils said:
Hey you guys! :)
Umm I need help in AS accounting stock valuation
Perpetual and periodic method.
If you could send me notes
Would be really helpful
Click to expand...

hope you find this helpful
 

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student92

student92

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Gordious said:
Aslo nov 12/32/20. Answer is B. How? :s
http://papers.xtremepapers.com/CIE/Cambridge International A and AS Level/Accounting (9706)/9706_w12_qp_32.pdf
Click to expand...

we know that the finished goods is 900kgs and work in progress is 100, so for DM, it is simple, 3000/1000 X900= 2700
now, for the DL, we know that the work in pprogress is 50% complete, so in other words, its like that there are 50 complete units in work in progress,
so we will divide 3800 by 950 units, and then multiply with 900 to get 3600
same way for DO 1900/950 into 900, we get 1800
2700+3600+1800= 8100 which is b
 
student92

student92

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Gordious said:
Its nov 12/32/17. Please help me with this. Answer is C
A company’s trade receivables are $120 000 and the credit period is 30 days.
The company’s budget for next year provides for an increase in trade receivables of 25% and the
credit period given will increase to 60 days.
What will be the budgeted trade receivable total at the end of next year?
A $150 000 B $240 000 C $300 000 D $480 000
Click to expand...

sorry, but i dont know the correct reasoning,
we know that trade recivables are 120 000 in the first year, and there will be a 25% increase, so that makes it 150 000 in trade recivables
now the question tells us that the trade recivables collection period is 60 days, meaning 2 months, so the trade receivables at the year end will be of 2 months, therefore 300 00

i am not sure about this reasoning, i dont know why we have to multiply by two, arent these 150 000 trade recivables for the whole year? and not for a month, instead, we should have divided by 12 to get for 2 months
 
Gordious

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student92 said:
we know that the finished goods is 900kgs and work in progress is 100, so for DM, it is simple, 3000/1000 X900= 2700
now, for the DL, we know that the work in pprogress is 50% complete, so in other words, its like that there are 50 complete units in work in progress,
so we will divide 3800 by 950 units, and then multiply with 900 to get 3600
same way for DO 1900/950 into 900, we get 1800
2700+3600+1800= 8100 which is b
Click to expand...
ThankYou so much. Got it! :)
 
Gordious

Gordious

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student92 said:
sorry, but i dont know the correct reasoning,
we know that trade recivables are 120 000 in the first year, and there will be a 25% increase, so that makes it 150 000 in trade recivables
now the question tells us that the trade recivables collection period is 60 days, meaning 2 months, so the trade receivables at the year end will be of 2 months, therefore 300 00

i am not sure about this reasoning, i dont know why we have to multiply by two, arent these 150 000 trade recivables for the whole year? and not for a month, instead, we should have divided by 12 to get for 2 months
Click to expand...
Same thought. I also assumed them to be for the whole year but the ms shows the other way round. In all such qs like n02/3/22, the same thing is being done ; multiply by 2 months :s
 
Gordious

Gordious

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student92 said:
we know that the finished goods is 900kgs and work in progress is 100, so for DM, it is simple, 3000/1000 X900= 2700
now, for the DL, we know that the work in pprogress is 50% complete, so in other words, its like that there are 50 complete units in work in progress,
so we will divide 3800 by 950 units, and then multiply with 900 to get 3600
same way for DO 1900/950 into 900, we get 1800
2700+3600+1800= 8100 which is b
Click to expand...
And if you can tell me in which order do the bonus shares get issued.. i know that first the capital reserves are used and then revenue..but i don't know the exact order..eg share premium first or revaluation reserve?​
 
WayneRooney10

WayneRooney10

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Gordious said:
And if you can tell me in which order do the bonus shares get issued.. i know that first the capital reserves are used and then revenue..but i don't know the exact order..eg share premium first or revaluation reserve?​
Click to expand...
-Revaluation reserve
-Share premium
-General reserve
-Retained earnings
Issuing bonus shares using reserves in that order will leave the reserves in their most flexible form.
 
Dinuka Malith

Dinuka Malith

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Could someone tell me how the interest rates will affect the Net Investments Income on the Current Account?
 
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