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The following information relates to AA.
Extract of Trial Balance at 31 December 20X4;
Notes
(i) Inventory at 31 December 20X4 was valued at cost at $30.
(ii) The loan which was received on 1 July 20X4 is repayable in 20X9.
(iii) Corporate income tax represents an over-provision of tax for the year ended 31 December 20X3. AA reported a loss for tax purposes for the year ended 31 December 20X4 and a tax refund is expected amounting to $20.
(iv) Cost of sales, administration and distribution costs need to be adjusted for the following:
What figures should be entered in the Statement of Profit or Loss for the year ended 31 December 20X4 in relation to Administration and Distribution costs?
Suggested Answer: C
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30 comments · newest first
ER
Eric
11 months ago
Distribution costs should be closer to $120, I agree with A.
AS
Ashton
11 months ago
Surprised to see a tax refund expected, that’s unusual!
QU
Quentin
11 months ago
Not sure about that, $146 seems too high for admin costs.
MA
Magnolia
12 months ago
I think option C looks right, $141 for admin!
WI
Willodean
12 months ago
Admin costs should definitely be around $120.
HI
Hildred
1 year ago
I’m stuck between options A and D. I need to recall how we adjusted for over-provisions in our practice questions.
LA
Lavonda
1 year ago
I feel like I’ve seen options like these before in our mock exams. I’m leaning towards option C, but I’m not entirely confident.
GI
Giovanna
1 year ago
I think the administration costs should be around $120, but I’m a bit confused about the distribution costs.
AN
Angelica
1 year ago
I remember we practiced a similar question about adjusting costs, but I’m not sure if the figures are exactly the same.
LU
Luther
1 year ago
This looks straightforward enough. I just need to plug the numbers from the trial balance and notes into the right places. I'm confident I can get the correct administration and distribution costs.
HA
Han
1 year ago
I've got a good strategy here. I'll start by calculating the adjustments mentioned in note (iv), then factor in the other information from the notes. I think I can get the right answer if I work through this methodically.
GE
Geraldo
1 year ago
I'm a bit confused by the loan details and the tax refund. I'll need to make sure I understand how those impact the final figures.
CR
Crissy
1 year ago
Hmm, this looks like a tricky one. I'll need to carefully review the trial balance and notes to figure out the correct administration and distribution costs.
AN
Annice
1 year ago
Okay, let me think this through step-by-step. The notes mention adjustments needed for cost of sales, administration, and distribution. I'll need to calculate those adjustments based on the information provided.
AR
Art
1 year ago
Hmm, this is a tricky one. I'll need to carefully compare the statements to determine which one is incorrect.
DE
Dell
1 year ago
I think the FORMAT statement in the PROC PRINT step looks correct, so I'll go with option B.
KA
Kami
1 year ago
This seems like a straightforward question about IPv6 migration strategies. I'm pretty confident I can figure this out.
HO
Horace
1 year ago
I'm watching you all struggle with this question, and I can't help but chuckle. Remember, the devil's in the details, my friends!
FR
Franchesca
1 year ago
Alright, let's do this! I'm feeling confident about option C, but I can't help but wonder if the examiner is just trying to trick us with all these little details.
LO
Louann
1 year ago
Haha, this question is like a game of Tetris - you gotta fit all the pieces together! I'm gonna go with option C, but I'm still scratching my head over that inventory value.
MA
Marjory
1 year ago
I'm still puzzled by that inventory value though. It does feel like a puzzle trying to figure it all out.
CR
Cruz
1 year ago
Yeah, I agree. It seems like the best fit for the figures given in the question.
ST
Stephaine
1 year ago
I think option C is the right choice. The administration cost is $141 and distribution cost is $117.
LO
Lottie
2 years ago
I'm not sure, but I think D might be the right answer.
SE
Serina
2 years ago
Hold on, I'm a bit confused. What's the deal with that loan and the tax refund? I feel like those details might be important in figuring this out.
JE
Jettie
1 year ago
User 2
TI
Titus
1 year ago
User 1
QU
Quentin
2 years ago
Hmm, let's see. I think option C looks like the right answer here. The administration and distribution costs need to be adjusted based on the information provided in the notes. This seems to be the only option that reflects those adjustments correctly.
HA
Hannah
2 years ago
I agree with Shizue, C seems to be the correct option.
SH
Shizue
2 years ago
I think the answer is C.