[Hinthu]

Ok, Now I got it, Thank you so much

[Hinthu]

Ok, Thank you

[Hinthu]

Ok, Thank you

[Hinthu]

Okay, but given that they produce the same chips, wouldn’t they need to reconfigure the machine ?

[Hinthu]

Thank you!

[Hinthu]

Sir,
I understand that accounting standards, particularly IAS 2, primarily pertain to financial accounting. However, our textbook stated that ‘absorption costing allows businesses to make decisions about pricing policies and value its inventory in accordance with IAS 2.’

This statement raised a question for me, as it seems to conflict with the treatment of storage costs under absorption costing when it comes to inventory valuation. Specifically, the textbook implies a direct correlation between absorption costing and IAS 2 for inventory, but storage costs of finished goods, which are part of inventory management, are typically excluded from product costs under absorption costing and treated as period expenses.

Therefore, I was seeking clarification on how absorption costing, when used for inventory valuation, aligns with IAS 2 given this apparent discrepancy.

[Hinthu]

Now, I’ve got it. Thank you.

[Hinthu]

So the statement is incorrect. The answer says the statement is correct.
Kaplan study text. Questions section. Question number 41. The answer provided is C.

The following statements refer to overhead absorption:
1 Factory rent and rates are typically allocated to departments rather than apportioned.

2 A single product firm does not need to apportion overheads to find a cost per unit.

3 If departmental overhead recovery rates are similar it makes little difference if overheads are applied on a departmental or business wide basis.

Which of these statements are correct?
A 1and2only
B 1and3only
C 2and3only
D 1,2and3

[Hinthu]

Thank you

[Hinthu]

I would like to express my sincere gratitude to OpenTuition for being an invaluable study support throughout my ACCA journey. I recently completed my first exam, Financial Accounting (FA), and achieved a score of 75%. I believe that self-study would not have been possible without OpenTuition.

I would also like to extend my thanks to our lecturer, Mr. John Moffat. He always addressed my queries through the OpenTuition forums. Thank you so much, sir. I am truly grateful for your guidance.

I hope that OpenTuition will continue to thrive and empower more students to succeed through self-study. I have already recommended the platform to several other students and am committed to contributing to its growth in any way I can.

Thank you.

[Hinthu]

Now, I’ve got it. Thank you so much.

[Hinthu]

I understand that for the adjustments, it is irrelevant whether cash is paid or not. Then why explanation is like we buy more, so less cash? Is it because we will add increase in payables that will result in net cash flow for purchases during the year?

[Hinthu]

Thank you so much. The question is from Kaplan study text: practice question, number 79.

[Hinthu]

Thank you for helping me figuring out the mistake I made in this question. I think there is a printing mistake in the answer provided. The question is from Kaplan Exam kit. Objective question number: 215.

[Hinthu]

I’ve got it. Thank you.

[Hinthu]

But the liability of $25000 is for next year. Is not it? Or should we need a clear date of year ending. I couldn’t quite understand it, explain please.

[Hinthu]

Yeah, I should have specified the doubt in
the question. I don’t have the answer, and the question is from the online group of students.
Should I include the loan (repayable in 4 annual instalments, starting January 2007)= 100,000 when calculating non-current liability as 25000? Since it is the liability start from the next January, I think it should not be included.
So, the amount of non-current liability is:
3250+31050+ 1200 =35,500.
35,500 is not in the options, but the 60,500.

[Hinthu]

Thank you.

[Hinthu]

Thanks a lot, sir.

[Hinthu]

It seems finally I’ve got it. We only make general allowance for debts that don’t have specific allowance. In this case, though we made 60% of specific allowance, it means we have made the specific allowance. Since the remaining 40% is considered to be recoverable, we don’t want to include that 40% when calculating general allowance. So, we subtract total of $1600 and calculate general allowance like this: 10%* (62900-2000-1600)

[Hinthu]

Y co was in financial difficulty and Apple wishes to provide an for allowance for 60% of their balance of $1600.
My understanding for above part:
If the allowance is 60% of the debt, that effectively means the remaining 40% is considered irrecoverable debt. Is that correct?

[Hinthu]

Thank you.

[Hinthu]

If the NCI is already a shareholder of the subsidiary, then why parent company has to pay full pre-acquisition retained earnings? For example, parent owning 70% in the subsidiary?

[Hinthu]

Thank you.

[Hinthu]

Sorry, it has happened mistakenly. I have reposted the question on the FA forum. I hope I can get clear my doubt there.

[Author]

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