key formulea and Systems

Question 1

Petty Cash Imprest

Answer 1

pre-set limit on Petty cash book
- vouchers to take money out => vouchers =cash = limit
- E/period = record vouchers and balance to limit

Question 2

Accounting Equation

Answer 2

Assets = Capital (c +profit-d) Liabilities

Question 3

Payroll

Answer 3

Gross Pay (net +PAYE + EE NIC+EE pension) + ER NIC + ER pension = Total payroll cost

Question 4

Cost of Sales (W1)

Answer 4

Opening Inventory
+ Purchases
+Delivery In
-Closing Inventory
(in manufacturing co. include Production wages, depn of NCA)

Question 5

Valuation of Inventory

Answer 5

Lower of Cost (purchase + conversion + bringing to location/condition) AND Net Realisable Value (Est. sell £ - cost of enhancement - cost to sell)

Question 6

Estimating Cost (FIFO)

Answer 6

sales | OI Purchases
split sales Left to right
Then whats left of purchases times by purchase value and sum

Question 7

Estimating Cost (AVCO weighted)

Answer 7

Sales/Purch | Units| £/unit|avg £/u | Total£|CoS
(remeber total before and after each sale) Sum at end = CI ans CoS in SPL

Question 8

Mark up (sales)/ margin(profit)

Answer 8

Sales -Marg 100% |M-up 100+y%
Cost - x% | 100%
Profit - 100-x% | y%

Question 9

Exam Short cut - Y/E expences

Answer 9

Cash paid - x
Closing accrued - x
Opening accrued - (x)
Closing prepay - (x)
Opening prepay - x
= TOTAL INCOME

Question 10

Exam Short cut - Y/E Incomes

Answer 10

Cash received - y
Closing accrued In- x
Opening accrued In- (x)
Closing deferred In- (x)
Opening deferred In - x
= TOTAL INCOME

Question 11

Bonus/Rights Issue Steps

Answer 11

1) number of current shares
2)number of new shares
3)value of shares
4) JNL

Question 12

Depreciation (Straight Line)

Answer 12

(cost-Residual Value)/Useful life
OR
(cost-RV)*depn rate(%)

Question 13

Depreciation (Reducing balance method)

Answer 13

=carrying amount (CA) * depn rate
=>
CA = cost * (100-%)^(years)

[use table long method - CA b/d | Depn Expense| Accumulate depn | CA c/d

Question 14

Depn (enhanced/change)

Answer 14

depn (old) +depn (cost of enhancement, remaining UL)

depn after change = (CA[from old] - new RV)/Remaining UL

Question 15

Impairment

Answer 15

Recoverable Amount = max(Fair value-Cost to sell, Value in use)
Impairment Loss = CA - Recoverable Amount

Question 16

Quick Disposal (cash and PEA)

Answer 16

Sell Price - CA = profit/loss
PEA - CA = p/l

Question 17

Amortisation

Answer 17

Straight line depn

Question 18

Bank Reconciliation (similar for Supplier statements recs - supplier statement with p-ledger)

Answer 18

Correction to Cash @ bank - Omissions (Standing orders, bank charges, interest (+or-), direct Debit, casting, transcribing)

Bank statement - Timing (uncleared lodgements (+), uncleares payments(-))
- Errors at bank
[for bank dr we owe, cr we’re owed

Question 19

Standard Working 1

Answer 19

Expenses
CoS (above) |
Dist. Costs (costs for marketing and dist i.e wages for marketing + dist staff, delivery out, ad expenses, depn Motor) |
Admin Exp (Irre debts, Depn other (L+B, intang), Sundry)

Question 20

Standard Working 2

Answer 20

Depreciation
columns = land | buildings | all NCA
Rows = Cost (TB)
less accum depn (TB)
less current depn (work out)
= Carrying value