VCE AccountingPractice Examination 15

This paper covers

• Unit 3 recording: FIFO perpetual inventory with foreign-exchange and freight costs embedded in landed cost, credit purchase and sale journals, GST Clearing
• Unit 4 balance-day adjustments: prepaid insurance, accrued wages, accrued interest revenue, reducing-balance depreciation and their General Ledger effect
• Unit 4 disposal of a non-current asset: straight-line depreciation to date of disposal, carrying value, trade-in, loss on disposal, GST, journals and Disposal ledger account
• Unit 4 bad debts write-off and Provision for Doubtful Debts (percentage of net receivables), GST treatment and Balance Sheet presentation of net realisable value
• Unit 3 reporting: fully classified Income Statement and Balance Sheet from an adjusted trial balance, verifying Assets = Liabilities + Owner's Equity
• Unit 4 budgeting: three-month Cash Budget for a toy importer, receipts and payments classification, reconciliation of opening to closing cash
• Unit 4 analysis and interpretation: efficiency indicators (inventory / receivables / payables turnover in days) with profitability (Net Profit Margin, Return on Owner's Investment) over a two-year trend
• Ethical considerations: the temptation to delay an inventory write-down to protect reported profit, evaluated against relevance, faithful representation and the reporting-period assumption
• Accounting principles and assumptions and the four qualitative characteristics applied to recording, reporting and ethical judgement for a trading business

Students are permitted to bring into the examination the materials normally allowed for this subject. Answer all questions in the spaces provided.

This is an ATARMAxxing practice paper. It is not an official examination and is not affiliated with, endorsed by, or produced by the VCAA, NESA or the QCAA.