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CIMA Exam CIMAPRA19-F01-1 Topic 5 Question 96 Discussion

Actual exam question for CIMA's CIMAPRA19-F01-1 exam
Question #: 96
Topic #: 5
[All CIMAPRA19-F01-1 Questions]

The subsidiary company of Group XY has purchased 150,00 worth of goods its parent company. However the goods purchased have yet to arrive at the subsidiary at the end of the financial year 20X4, meaning there is a disagreement in the current account balances between the parent and subsidiary.

With Group XY looking to produce its CSOFP for the end of the financial year, which of the following statements are true in relation to accounting for this disagreement? Select ALL that apply.

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Suggested Answer: A

by Lili at Sep 11, 2024, 02:53 AM

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Kenneth
3 months ago
I'm feeling pretty good about this one. The correct answers are B, C, and F. The subsidiary should debit the inventory account, the goods will be included in the next year's CSOFP, and the payables account of the subsidiary should be credited. Easy peasy, right? Now, where's the snack bar?
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Elza
2 months ago
Exactly, easy peasy! Let's go find that snack bar now.
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Talia
2 months ago
So, the payables account of the subsidiary should be credited, correct?
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Cassi
2 months ago
Yes, the goods not arriving by the end of the financial year means they will be included in the next year's CSOFP.
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Herschel
2 months ago
I think you're right, the subsidiary should debit the inventory account.
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Jennifer
3 months ago
Hmm, this question is making my head spin. I think I need to consult the accounting gods for guidance on this one. Maybe they can send me a sign in the form of a calculator or a really sharp pencil.
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Nenita
3 months ago
I'm pretty confident that the correct answers are B, E, and G. The subsidiary should debit the inventory account, and the parent company should debit the payables account and credit the receivables account. That seems to make the most sense to me.
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Bok
2 months ago
That makes sense. So the correct answers are B, E, and G.
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Dana
2 months ago
Yes, and the parent company should debit the payables account and credit the receivables account.
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Jolene
2 months ago
I think you're right. The subsidiary should debit the inventory account.
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Willetta
4 months ago
Wow, this is a complex question. I'm not sure about the right answer, but I think it has something to do with the timing of the transaction and how it affects the accounts. Maybe I should re-read the question a few times to make sure I understand it.
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Jina
2 months ago
I'm not sure about the other statements, maybe we should carefully review the question again.
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Rocco
3 months ago
I believe 150,000 worth of inventory will be debited into the subsidiary's inventory account.
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Devora
3 months ago
I think the adjustments need to be accelerated to include them in the consolidation of assets for the CSOFP for 20X4.
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Jina
4 months ago
Hmm, this is a tricky one. I think the correct answers are B, C, and F. The subsidiary should debit the inventory account, and since the goods haven't arrived, they'll be included in the next year's CSOFP. And the payables account of the subsidiary should be credited.
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Nikita
2 months ago
That makes sense. It's important to accurately account for these transactions in the consolidation process.
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Yasuko
2 months ago
So, the payables account of the subsidiary should be credited with 150,000.
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Floyd
3 months ago
Yes, and since the goods haven't arrived by the end of the financial year, they will be included in the CSOFP for the next year.
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Royal
4 months ago
I think you're right, the subsidiary should debit the inventory account for 150,000 worth of goods.
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Derrick
4 months ago
I'm not sure about option A. I think option B might also be true because the inventory should be debited into the subsidiary's account.
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Wayne
4 months ago
I agree with Sheridan. Option A seems like the correct approach to take in this situation.
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Sheridan
4 months ago
I think option A is true because we need to resolve the disagreement quickly for the CSOFP.
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