Last day of the reporting period

Stock Gain is an example of...

A revenue that is not a receipt

How do we treat GST when recording the Balance Day Adjustment for prepaid expenses?

Paid at the time of the payment not when recording the BDA

Accrued expenses are expenses that...

Have been incurred but not yet paid

Operating activities include:

Day to day trading activities involving cash

Each balance day adjustment of expenses..

Increases the expense, therefore decreases Net Profit

The order in which a cash flow statement is arranged is...

Operating, Investing, Financing

Without Balance Day Adjustments...

Reports wouldn't include all information for decision making

Depreciation is an example of...

An expense that is not a payment

Financing activities ONLY include:

Anything to do with the owner or loans except interest

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Balance Day Adjustments

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Review of Balance Day Adjustments in Unit 2 VCE Accounting #accounting #balancedayadjustments

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Questions 18

Answers

1
When is Balance Day?
First day of the reporting period
Last day of the reporting period
31st December
30th of June
2
Why is Reliability breached when reporting depreciation of non-current assets?
The figure for HC might have changed over time
Both B and C are correct
The valuing of a non-current assets RV may not be accurate
The figures for UL and RV are based on estimates
3
Stock Gain is an example of...
A receipt that is not a revenue
A revenue that is not a receipt
A payment that is not an expense
An expense that is not a payment
4
Balance Day Adjustments are reported based on which accounting PRINCIPLE?
Historical Cost
Consistency
Reporting Period
Going Concern
5
How do we treat GST when recording the Balance Day Adjustment for prepaid expenses?
Paid at the time of the payment not when recording the BDA
We don't, GST does not affect the business
It is an ongoing payment
We pay it once the BDA has been dealt with
6
Accrued expenses are expenses that...
Have been paid but not yet incurred
Have been incurred but not yet paid
Both B and C are correct
Should be reported as Assets in the Balance Sheet
7
Operating activities include:
Only GST and Receipts from Debtors
Only Sales and Cost of Sales
Everything that isn't a financing or investing activity
Day to day trading activities involving cash
8
GST paid, GST received and GST settlement are all examples of
Liabilities
Financing Activities
Investing Activities
Operating Activities
9
Which is NOT part of the definition of a Current Asset?
Controlled by the entity
Used within 12 months
Generate future outflows
Item of future economic benefit
10
Each balance day adjustment of expenses..
Increases the expense, therefore decreases Net Profit
Decreases the expense, therefore increases Net Profit
Decreases the expense, therefore decreases Net Profit
Increases the expense, therefore increases Net Profit
11
The depreciation formula is:
(HC-RV)/UL
SP= CP(1+MU%)
Net Profit/Sales
A= L + OE
12
Purchasing a non-current asset for cash would be classed as ___ in the Cash Flow Statement
An Operating Activity
An Investing Activity
It is not included in the Cash Flow Statement
A Financing Activity
13
The order in which a cash flow statement is arranged is...
Financing, Investing, Operating
Operating, Investing, Financing
Financing, Operating, Investing
Investing, Operating, Financing
14
Which statement is true if the balance day adjustment for prepaid rent was NOT done?
OWNER'S EQUITY would be UNDERSTATED
ASSETS would be OVERSTATED
LIABILITIES would be OVERSTATED
ASSETS would be UNDERSTATED
15
Without Balance Day Adjustments...
All liabilities would be overstated
All answers are correct
Employees would not get paid
Reports wouldn't include all information for decision making
16
Depreciation is an example of...
A receipt that is not a revenue
An expense that is not a payment
A payment that is not an expense
A revenue that is not a receipt
17
Financing activities ONLY include:
Capital and Drawings
Anything to do with the owner or loans except interest
Anything to do with the owner or loans
Loans and Interest on Loans
18
What is NOT an example of an expense?
Advertising
Depreciation
Wages
Accrued Expense Paid

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