International Stream Preparing Financial Statements doc

Email accaqueries @bpp.com fax 020 8740 2293 or phone us 020 8740 2242/2245 Learning Resource Centre regulatory framework Learn interactively BPP i-Learn/BPP Virtual Campus Module 1 Im

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International Stream

Preparing Financial Statements

Part 1 Paper 1.1 Study Text Edition June 2005

AH05 –1.1 INTERNATIONAL

FOR EXAMS IN DECEMBER 2005 AND JUNE 2006

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We want to help you pass

Your BPP team for Paper 1.1 Preparing Financial Statements (International Stream)

Mary Maclean Katy Hibbert Janice Ross

We are here to answer the technical and study queries that you have as you progress through the course We will always reply to you promptly

E-mail us on accaqueries@bpp.com or fax us on 020 8740 2293 Alternatively call

us during working hours on 020 8740 2242 or 020 8740 2245, or leave a voice message on our overnight message service

Please help us to save both you and BPP time by giving us details of which paper you are studying, which piece of material you are using, such as Study Text, Revision Kit or Passcards, and which page or question number you are looking at Give us details of who you are and your work and home numbers Tell us if there are any times we will not be able to reach you

If you have any course administration queries, such as amending exam submission dates, then please call 020 8740 2233

We look forward to seeing you progress through the course

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Study Text Edition: June 2005

PREPARING FINANCIAL STATEMENTS

1 Introduction

This Home Study course will guide you through the June 2005 edition of the BPP Study

Text This June 2005 edition is for exams in December 2005 and June 2006 If your

Study Text does not have that date on the back cover, please contact BPP

2 Using the BPP Home Study

(a) The Study Programme is made up of 27 Study Periods, which BPP has graded as

high, medium or low priority, based upon guidance from ACCA and the examiners Each Study Period consists of the following elements

(i) Exam Guidance

This gives an introduction to each Study Period by explaining the emphasis that the examiner has placed on the topics to be covered on the basis of the pilot paper, past exams and discussions with BPP authors and tutors

(ii) Guidance through the Study Text

Here you are given important instructions on how to work through the BPP

Study Text You must follow the guidance in this table for time effective study, as you will be told which areas of each chapter must be worked through in detail

and which can be skimmed over The table contains essential points,

summarising the most vital areas of the Study Period

(iii) Were you awake?

These are brief questions on the essential points, designed to test whether you were concentrating You MUST get these questions right! If not you'll need

to go back and study the material again There is space for you to add your

own notes as you study the Text

(iv) Common Pitfalls

To help your question practice and revision, we give you guidance on the most common mistakes made by students on key areas

(v) Learning Resource Centre

For further help with study and revision, we refer you to the relevant sections on

BPP's i-Pass CD-ROM and BPP's i-Learn CD-ROM

Each Study Period should take about 2½ hours There is an overview of all Study Periods, on page (v), which can be used to set up a timetable

The annotated Study Programme will become a key document in your revision phase

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(b) Some of the Study Periods are 'progress tests' which assess the work done on a

limited number of Study Periods You should mark the tests yourself using the solutions at the end of the Study Programme

(c) You also have two Course Examinations These should be attempted at the point

suggested within the Study Programme (they cover all preceding Study Periods) and

sent to BPP for marking You will receive a detailed analysis of your performance, together with suggested solutions, which should help your exam technique as well as pointing out strengths and weaknesses in your understanding

To help you plan your study time, BPP will send you separately an Exam Timetable

with recommended dates for submission of the exams Should these dates prove impractical, please feel free to amend them to suit your own planned schedule However the date given for Course Exam 2 is the latest date by which we can guarantee to get the scripts back in time for the exams

To gain the greatest benefit from the exams, you must set aside a period of three hours during which you will have no interruptions

By submitting these exams, you will increase your chances of passing the real exams by 30%

(d) If you have any difficulty with your studies, e-mail us at accaqueries@bpp.com Alternatively, please telephone, fax or write to the Customer Services Administrator at BPP who will pass your query to one of our authors and tutors

Please help us to save both your time and BPP time by giving us the following details about your query

• Paper name/number

• Material reference and version (eg Study Text 2005, Revision Kit 2006)

• Page or question number

• A brief description of your query

Remember to include your name, student number and a contact number if necessary

Please make your query as specific as possible

3 BPP's i-Pass CD ROM

Your home study course includes BPP's i-pass CD-Rom, which is designed to test knowledge and perfect exam technique It enables you to attempt tests, making it an ideal revision tool.

Paper 1.1 and 1.2 computer-based exams BPP i-Pass for these two papers provides an

exam-like environment with testing against the clock Regular practice will ensure you're ready for the real thing

BPP i-Pass for 1.3 and Part 2 papers provides an opportunity to test and revise your

knowledge of important syllabus areas

BPP i-Pass for Part 3 papers enable you to test and revise your knowledge - and your

ability to apply this knowledge

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i-Pass queries

To help us answer any BPP i-Pass queries you have quickly and effectively, please follow the steps below (This procedure is necessary as questions appear in a different order each time the CD is used)

Step 1 With the question you wish to query on-screen, push the Print Scrn (Print

Screen) button on your keyboard (usually located to the right of the F12 key) This will copy the image of the question to your computer's 'clipboard'

Step 2 Start Microsoft Word (You can do this while i-Pass is running – click on the start

button, then select Microsoft word from the programs option.)

Step 3 Paste the image from the clipboard into a new Word document Do this by

selecting Edit, Paste – or by using the Paste button on the Word toolbar

Step 4 Save the document with a meaningful name, eg iPass_Paper1.2_query.doc (or

better still use the number referred to in Step 5 below in the document name,

excluding the /s)

Step 5 E-mail the document, with details of your query, to accaqueries@bpp.com If you

make contact by phone, the person dealing with your query will ask you to e-mail

or post a copy of the document to them If possible, in the detail of your query please include the reference number that appears very faintly on-screen in the

white area below the 'Exit' option - for example 02/CO/0134

4 Learning to Learn Accountancy

Whether you are about to start your studies or continuing them, BPP's Learning to Learn Accountancy will help you learn efficiently and effectively It also provides

essential guidance on dealing with your exam If you did not request this when ordering your Home Study Course you should contact Customer Services on 0845 0751 100 (UK only, local rate) or +44 (0)20 8740 2233 if calling from outside the UK (Only one copy per student – it can be used again and again throughout your course.)

5 Revising with the BPP Home Study Course

For your revision phase, your Home Study Course includes the following

(a) The BPP Practice and Revision Kit, which contains past paper questions and other useful practice questions The Kit also contains Revision Guidance which highlights

the key questions to attempt to maximise your chances of exam success

(b) The Study Programme, where the Essential Points and Common Pitfalls will serve as

a reminder of the work you did in each Study Programme

(c) The BPP Passcards, which give short summaries of the content of each chapter of

the Text

Revision should not start until you have completed your second course examination

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6 Feedback

The success of BPP's courses has been built on what you the students tell us Towards the end of your course you will be sent a feedback form to complete and return

If you have any issues or ideas before you are given the form to complete, please contact the course administrator, on 0845 0751 100 (UK only, local rate) or +44(0)20 8740 2233 (overseas) or via e-mail at accaqueries@bpp.com

7 Overview of Preparing Financial Statements

The paper aims to test your ability to:

• Describe the role and function of external financial reports and identify their users

• Explain the accounting concepts and conventions present in generally accepted accounting principles

• Record and summarise accounting data

• Maintain records relating to fixed asset acquisition and disposal

• Prepare basic financial statements for sole traders, partnerships, incorporated enterprises and simple groups

• Appraise financial performance and the position of an organisation through the calculation and review of basic ratios

• Demonstrate the skills expected in Part 1

How to use your Study Text

The cornerstone of your studies is the BPP Study Text The front pages give essential guidance

on how to use the Text and vital information on study skills

Before you go any further, look at the front pages of your Study Text They are there to help

Step 1 Read the section: Help yourself study for your ACCA exams Read and apply the study

skills section Consider your style of learning and try to develop a personal study plan Step 2 Look at the syllabus, to see what you're up against

Step 3 Look at the topics that have been examined in the past, in our analysis of past papers

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STUDY PERIOD PLANNER

Use this schedule and your exam timetable to plan the dates on which you will complete each

study period The letters 'H' ‘M’ and 'L' tell you whether the topic is high, medium or low priority

Detailed guidance and prioritisation of each study period begins on page 2

4 Sources, records and

the books of original

entry

M

5 & 6 Ledger accounting

and double entry H

7 From trial balance to

financial statements

H

8 The cost of goods

sold, accruals and

17 Accounting conventions and standards

H

18 Incomplete records H

19 Limited liability companies

Your revision, using the questions and revision guidance in the BPP Passcards and

the BPP Practice and Revision Kit, will begin when Course Exam 2 is complete This

should, at the latest, be four weeks before the final exam

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APPROACHING PREPARING FINANCIAL STATEMENTS

The paper develops the foundations of accounting techniques and places particular emphasis on:

• The operation of financial accounting systems

• Preparing simple financial statements

• Understanding the main components of company accounts

• Preparing a simple consolidated balance sheet

The subject areas which are most frequently examined include, the preparation of final accounts, particularly limited companies, application and explanation of accounting standards and the usefulness of financial reporting

It is important that, even at this stage, you keep up to date with developments in

financial reporting The Student Accountant magazine provides a good source of articles

on developments and current issues, some of which may be written by this subject’s examiner

Accounting is a practical subject and there is no real substitute for practising the skills you learn on this course As you eventually sit an exam we have included quite a few questions in the course so that you can practice the skills utilising the method used in the exam However, anything you do at work will also help in developing the skills which form the foundation of future papers

50% of the marks available on this paper are for 25 multiple choice questions (MCQs) which will cover the whole syllabus The remaining 50% of the total marks are for 5 compulsory questions There will be an element of computation but knowledge will also

be tested using discursive questions The examiner has specifically said that candidates perform less well on these types of question so make sure you spend time practising these as well as computational questions For the computational style questions concentrate on presentation, learn all the relevant proformas and always remember to cross reference your working to the solutions

Examination dates

The cross references to the examination dates are to the ten mark compulsory questions

only You can assume that every topic has been examined via MCQs in the Pilot Paper

and examinations set to date

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Study Period 1 Introduction to accounting

Priority = High

Date due:

Exam Guidance

This Study Period covers some basic background information to set you up in your studies,

together with important knowledge for any written questions

Guidance through the Study Text

These topics are covered in Chapter 1 Introduction to accounting

1 Purpose of accounting

information

Read through carefully Definition of accounting;

users of financial statements

2 The main financial

statements

Pay particular attention, as it is essential background information

Composition of published financial statements

3 Nature, principles and

scope of accounting

Work through quickly

4 The desirable qualities

of accounting information

Read through carefully Learn the desirable features

of useful accounting information

5 The regulatory system Work through quickly, we will

study this in detail in Chapter 24

6 Capital and revenue

expenditure

Read through carefully Difference between capital

expenditure and revenue expenditure

Try Questions 1 and 3 in the Exam Question Bank of your Study Text

Exam focus point

This chapter covers basic background knowledge It may be examined by a MCQ or as part of a ten mark written question eg users of financial statements and their needs

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Study Period 1 continued

Were you awake?

If you've been concentrating, you should be able to answer some key questions

Who are the users of financial information?

What are the main financial statements?

What are the desirable qualities of good accounting information?

Expenditure on a desk is revenue expenditure True or false?

Any problems?

Email (accaqueries @bpp.com) fax (020 8740 2293) or phone us (020 8740 2242/2245)

Learning Resource Centre

regulatory framework

Learn interactively BPP i-Learn/BPP Virtual Campus Module 1

Improve your study skills BPP's Learning to Learn

Accountancy book *

* Included within your Home Study course

If you want any of these products, visit: www.bpp.com/acca

Common Pitfalls

• Ignoring the needs of the different user groups

• Confusing capital and revenue expenditure

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Study Period 2 The accounting equation

These topics are covered in Chapter 2 The accounting and business equations

1 Assets and

liabilities and the business entity

Read through carefully Definitions of assets and

liabilities; business entity convention

2 The accounting

equation (or balance sheet equation)

Work through quickly, paying particular attention to the examples

The accounting equation;

nature of capital and drawings (withdrawals on account of profit)

3 Payables and

receivables

Make sure you understand this Learn the definitions of

receivables and payables

Try Question 2 in the Exam Question Bank of your Study Text

This equation will never form the basis of a whole exam question, but will form the background to most accounting problems

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Were you awake?

A business is always treated separately from its owners for accounting purposes True or false?

State the accounting equation

What are drawings (withdrawals of profit) and how are they treated?

Give one example each of an asset, a liability, a receivable and a payable

Any problems?

Test your knowledge BPP i-Pass * Session 1: Intro and the regulatory framework

Improve your study skills BPP's Learning to Learn Accountancy book *

Common Pitfall

• Just learning the accounting equation, without knowing how to apply it in practice

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Study Period 3 Basic financial statements

Date due:

Exam Guidance

You will usually be asked to produce an income statement or a balance sheet for a limited

liability company (see Study Period 19) Therefore this study period is extremely important for

your future studies

These topics are covered in Chapter 3 Basic financial statements

1 The balance sheet Read through carefully Layout of the balance sheet

2 The income statement Read through carefully Layout of the income statement

The June 2005 exam required the preparation of a balance sheet for a limited liability company

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Were you awake?

Give examples of current and non-current liabilities

What is a non-current asset?

Give examples of three current assets

Any problems?

Test your knowledge BPP i-Pass * Session 1: Intro and the regulatory framework

Common Pitfalls

• Failure to learn the proforma layouts of the balance sheet and income statement

• Failing to appreciate the differences between current and non-current assets, and current and non-current liabilities

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Study Period 4 Sources, records and the books of original entry

Priority = Medium

Date due:

Exam Guidance

Books of original entry form one of the bases of double entry bookkeeping and so you should

gain a thorough understanding of this topic as background knowledge for your future studies

These topics are covered in Chapter 4 Sources, records and the books of original entry

1 The role of source

documents

Skim through quickly

2 The need for books

of original entry

Work through quickly

3 Sales and purchase

day books

Work through this very carefully Format of sales and

purchases day books

4 Cash books Pay particular attention to this section Format of the cash book

Books of original entry are often examined in MCQs

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Were you awake?

What use are books of original entry?

List the books of original entry and the transactions recorded in each

All sales are recorded in the sales day book True or false?

What is recorded in the cash book?

Any problems?

Test your knowledge BPP i-Pass * Session 2: Double entry, assets and liabilities

Common Pitfall

• Using the sales and purchase day books to record all sales and purchases Only

credit sales and purchases should be recorded

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Study Periods 5 & 6 Ledger accounting and double entry

These topics are covered in Chapter 5 Ledger accounting and double entry

The dual effect behind double entry bookkeeping: debits and credits

4 The journal Read through carefully The use of the journal

7 The receivables

and payables ledgers

Read this carefully Use of the receivables and payables

ledgers to show what each individual customer owes and what

is owed to each individual supplier

8 Accounting for a

sales tax

Work though this section slowly and make sure you understand the principles involved

The accountancy treatment of input and output sales tax

Try Questions 6 7 and 8 in the Exam Question Bank of your Study Text

The examiner likes to test double entry principles Be prepared for questions that ask you to 'journalise' transactions to illustrate the double entry involved

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Study Periods 5 & 6 continued

Were you awake?

What do debits and credits represent?

What is the basis of the double entry system?

Summarise the double entry for output sales tax

Summarise the double entry postings from the sales day book

Any problems?

assets and liabilities

Common Pitfalls

• Confusing the receivables account in the nominal ledger with the memorandum

receivables ledger (and similarly for the payables account/payables ledger)

• Not appreciating that the receivables and payables ledgers are not part of the

double entry system

• Confusing input and output sales tax

• Lack of understanding of the treatment of sales tax in the income statement and the balance sheet

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Study Period 7 From trial balance to financial statements

These topics are covered in Chapter 6 From trial balance to financial statements

1 The trial balance Read through this section very

Work though the questions very carefully

Make sure that you understand the answer to Question 3 and can reproduce the answer yourself without looking at the book

Try Questions 15, 19, and 20 in the Exam Question Bank of your

Study Text

Most accounts preparation questions will start with a trial balance or draft statements, which need

to be adjusted for publication There are usually several MCQs on the correction of errors

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Were you awake?

What is a trial balance?

Why does a trial balance balance?

What type of errors are disclosed by a trial balance?

What items go into the capital account?

Any problems?

Session 2: Double entry, assets and liabilities Session 7: Incomplete records and sales tax

Learn interactively BPP i-Learn/BPP Virtual Campus Module 3 and 10 (VAT) Improve your study skills BPP's Learning to Learn Accountancy book *

Common Pitfall

• Understating the importance of this chapter – it is essential reading

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Study Period 8 The cost of goods sold, accruals and prepayments

These topics are covered in Chapter 11 The cost of goods sold, accruals and prepayments

1 Cost of goods sold Work through carefully Adjustments for closing inventory

2 Accruals and

prepayments

Pay particular attention to this ,

as it features in every exam

Accruals are expenses not yet paid for and so are a liability in the balance sheet

Prepayments are expenses paid for a future trading period and so are an asset in the balance sheet

There are usually a number of MCQs on accruals and prepayments

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Were you awake?

Inventory adjustment, accruals and prepayments are examples of which concept?

Define an accrual

What is the double entry for prepayments?

How do you calculate the cost of goods sold, including adjustments for opening and closing inventory?

Any problems?

Test your knowledge BPP i-Pass * Session 3: Balance sheet provisions

Learn interactively BPP i-Learn/BPP Virtual Campus Module 4 Part 1

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Study Period 9 Bad debts and allowances

Date due:

Exam Guidance

These topics are unlikely to be the basis for an entire question However, they could be

examined in control accounts (Study Period 14) or preparation of final accounts

These topics are covered in Chapter 12 Bad debts and provisions

1 Bad debts Pay particular attention to this, as

it is normally examined

Definition of a bad debt

2 Allowances for

doubtful debts

Read through this very carefully How to calculate the increase or

decrease in a general allowance

3 Accounting for

bad and doubtful debts

Work through this carefully Make sure you know the accounting

treatments

Calculating the movement on the allowance for receivables account is a popular MCQ, which featured in the June 2005 exam

Note that ACCA no longer refer to ‘doubtful debts’ The balance sheet account is now referred to

as the “allowance for receivables”

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Were you awake?

What is a bad debt?

How do you account for a recovery of a debt previously written off as bad?

What is the accounting treatment of a decrease in a general allowance for receivables?

How do you account for a specific allowance for receivables?

Any problems?

Test your knowledge BPP i-Pass * Session 3: Balance sheet provisions

Common Pitfall

• Calculating the general allowance on the debtors balance before dealing with bad debts and specific allowances – the order of calculation is crucial

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Study Period 10 Accounting for inventories

Date due:

Exam Guidance

You must understand the importance of inventory valuation calculations, as well as being able

to use the different methods

These topics are covered in Chapter 13 Accounting for inventories

1 Accounting for opening

and closing inventories

Read through carefully Learn the accounting entries

for inventory

2 Counting inventories Skim read this section

3 Valuing inventories Pay particular attention to this Learn the different valuation

methods

4 IAS 2 Inventories Read through this carefully Learn the rule that inventory is

valued at the lower of cost and NRV

The June 2005 paper had two MCQs on inventory

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Were you awake?

What are the ledger account entries for opening and closing inventory?

What is the effect of the FIFO, LIFO and weighted average methods on profit?

(But remember that LIFO is no longer allowed)

What is the basic concept behind IAS 2?

What is the difference between continuous and period end inventory counting?

Any problems?

valuations

Improve your study skills BPP's Learning to Learn

Accountancy book *

Common Pitfall

• Not understanding the principles behind IAS 2 – you may be asked to discuss these

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Study Period 11 Non-current assets and depreciation

Date due:

Exam Guidance

Depreciation is a key area that can form an entire question or part of an accounts preparation

question You must know and understand the basic rules of IAS 16 Discursive questions may

be set, requiring the explanation of the purpose of depreciation and the factors that need to be

taken into account in assessing the amount of depreciation required each year

These topics are covered in Chapter 14 Non-current assets and depreciation

Skim read this section

6 The asset register Skim read this section

7 Preparation of final

accounts for a sole trader

Work through this carefully Make sure you can reproduce

the answer to Question 5

The June 2005 exam had an MCQ on property revaluation and a balance sheet preparation question requiring adjustments to non-current assets

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Were you awake?

What is the definition of non-current assets?

Define depreciation

What are the accounting entries for a disposal of non-current assets?

How do you calculate depreciation on the straight line basis?

Any problems?

provisions

Common Pitfalls

• Deducting residual value when performing the reducing balance method of depreciation Remember, when using reducing balance depreciation ignore the residual value and the useful life Simply apply the depreciation % rate to the NBV

• Calculating the number of months incorrectly if an asset is acquired during the year – you may need to pro-rate depreciation charges in this case

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Study Period 12 Progress Test 1

Priority = High

Date due:

In order to reinforce what you have learnt in Study Periods 1 – 11, answer the following multiple choice questions without referring to your Study Text or notes You should then revise any areas with which you had difficulty

1 The purpose of a balance sheet is to show:

A A clear and definite estimate of what a business is really worth

B The amount the business could be sold for in liquidation

C The amount the business could be sold for as a going concern

D The assets of the business and the claims against those assets

2 A debit entry to the sales account could represent:

A Cash sales

B Credit sales or the correction of an error

C Bad debts written off

D The correction of an error or goods returned

3 Which of the following statements is incorrect?

A If the trial balance does not balance an error must have been made

B The closing inventory balance is included in the trial balance

C Proprietors withdrawals are shown on the trial balance

D The opening inventory balance is included in the trial balance

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4 A business is set up with $5,000 capital and a $3,000 loan During the first six months trading $1,500 is spent on non current assets and $4,400 on inventory Half the inventory is sold for $3,050 The owner withdraws $200 per month for living expenses and takes $150 worth of goods from inventory

What is the balance on the capital account at the end of the period?

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6 A business has received telephone bills as follows:

Date received Amount of bill Date paid

$ Quarter to 30 November 19X8 December 19X8 739.20 January 19X9 Quarter to 28 February 19X9 March 19X9 798.00 April 19X9 Quarter to 31 May 19X9 June 19X9 898.80 June 19X9 Quarter to 31 August 19X9 September 19X9 814.80 October 19X9 Quarter to 30 November 19X9 December 19X9 840.00 January 20X0 Quarter to 28 February 20X0 March 20X0 966.00 March 20X0

In the income statement for the year ended 31 December 19X9, the charge for telephone should be:

on a straight line basis over 50 years What is the amount that would be credited to the revaluation reserve?

What is the profit on disposal?

A $2,000

B $8,000

C $12,000

D $20,000

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9 At 31 December 19X8 the ledger of X Co included a $2,240 receivables allowance During the year ended 31 December 19X9 bad debts of $850 were written off Receivables balances at 31 December 19X9 totalled $72,400 and the company wished to carry forward

a general allowance of 2% The charge for bad debts in the 19X9 income statement is:

• $2,500 from J Dougall & Sons who have gone into liquidation

• Debts of $500 + $1,500 which are to be specifically allowed for

• Cash received from P King of $1,800 which had previously been written off

• Cash received from T Hussle of $2,900 which had previously been allowed for

What is the revised receivables figure?

A $52,200

B $50,200

C $49,300

D $45,500

You will find the answers to this test at the end of this Study Programme If you answer more than

5 questions correctly, your performance is satisfactory; if you answer more than 7 correctly, you are doing very well

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Study Period 13 Bank reconciliations

These topic are covered in Chapter 8 Bank reconciliations

1 Bank statement

and cash book

Read through quickly

2 The bank

reconciliation

Read through carefully Common causes of differences between

the cash book and the bank statement

3 Worked

examples

Work through very carefully Learn the layout of a bank

reconciliation

This topic will usually be examined by one or more MCQs However a more complex ten mark question could well be set

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Were you awake?

What are the common causes of differences between the cash book and the bank statement?

Why do businesses want to prepare a bank reconciliation?

The bank statement balance is reconciled to the cash book balance before any adjustments are made to the cash book True or false?

List three examples of adjustments to be made to the cash book

Any problems?

Test your knowledge BPP i-Pass * Session 4: Accounting records and reconciliations

Common Pitfalls

• Failing to learn the layout

• Treating bank statement balances incorrectly Remember the bank statement is shown from the bank's perspective not yours A credit on the statement, for example, shows that you are a creditor of the bank and they owe you money For you this is a debit, an asset

• Getting confused with overdrafts Remember, a bank overdraft should be shown

as a negative number on the bank reconciliation statement In the nominal ledger of the business it will be a credit balance in the bank T-account

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Study Period 14 Control accounts

Priority = High

Date due:

Exam Guidance

A highly examinable topic

This topic gives scope for testing of double entry techniques, discounts, bad debts etc, so you must be clear on your basic double entry in these areas Control accounts may form an entire question or part of a question

These topics are covered in Chapter 7 Control accounts

1 What are control

accounts?

Read through quickly

2 Discounts Read through carefully Distinction between trade and

settlement discounts and their accounting treatments

Has been examined by MCQs to date However it could form a ten mark question in a future exam

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