This is because of the principle of accrual basis of accounting. The godown rent on the trial balance represents the rent that was paid (750) however the total godown rent expense for the whole year was 1000. Therefore, the balance of 250 which will be paid in the next accounting year is taken to the statement of financial position Under current liabilities as an accrued expense. kindly also refer to working 7 to further understand the concept of accruing expenses.
Welcome. From the additional information number two,11,400 was the subscription received for the current year, but the total subscription received was 12,525 so 11,400 is already included in 12,525.
Thank you for your question. Under the cash payments before banking the balances received from customers, there is: Motor vehicle operating expenses of 258, wages of 296, general administrative expenses of 50, drawings by Melody per week of 15 and drawings by Olivia per week of 12.
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Thank you very much for your great help. Can you do a video on the most tested areas and what is likely to be tested?
Welcome. I will do the video very soon.
Kindly revise ATD 2 2024 April paper
And on the godown expense why did take the one on the additional information and not the one on the trial balance?
Same to this
This is because of the principle of accrual basis of accounting. The godown rent on the trial balance represents the rent that was paid (750) however the total godown rent expense for the whole year was 1000. Therefore, the balance of 250 which will be paid in the next accounting year is taken to the statement of financial position Under current liabilities as an accrued expense. kindly also refer to working 7 to further understand the concept of accruing expenses.
Thanks
Thank you sir. I have a question regarding number 5b. Why was the 11,400 not included?
Welcome. From the additional information number two,11,400 was the subscription received for the current year, but the total subscription received was 12,525 so 11,400 is already included in 12,525.
Thankyou very much!!
How are you able to access the answers?
Welcome. I suggest these answers since I am a qualified Financial Accounting lecturer to help my students in revision.
@@cpaquestionsandanswers-lg6lv Ohh Thankyou for your help!!
Hi ,where did you get the 296 for wages
I have seen the working, thanks
Thank you for your question. Under the cash payments before banking the balances received from customers, there is: Motor vehicle operating expenses of 258, wages of 296, general administrative expenses of 50, drawings by Melody per week of 15 and drawings by Olivia per week of 12.
@@cpaquestionsandanswers-lg6lv thanks