Candidates’ Performance Candidates’ Performance in the 2010 Examination – in the 2010 Examination – Paper 1 Paper 1 Mr. WAN Shiu-kee Mr. WAN Shiu-kee Vice Chairman Vice Chairman Hong Kong Association for B Hong Kong Association for B usiness Education usiness Education
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Candidates’ Performance in the 2010 Examination – Paper 1 Mr. WAN Shiu-kee Vice Chairman Hong Kong Association for Business Education.
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Candidates’ PerformanceCandidates’ Performancein the 2010 Examination – Paper 1in the 2010 Examination – Paper 1
Mr. WAN Shiu-keeMr. WAN Shiu-keeVice ChairmanVice Chairman
Hong Kong Association for BusinHong Kong Association for Business Educationess Education
2
Overall PerformanceOverall Performance
Satisfactory Possess required skill and knowledge
in presenting financial information in logical and systematic manner
Should have thorough understanding of the syllabus
Able to give appropriate answers based on the scenarios given
3
Overall PerformanceOverall Performance
Abbreviations are not acceptable Proper heading / title should be given
to each account / statement Journal narrations should not be
c) Not familiar with the adjustments relating to intra-group transactions
Most candidates reduced turnover and cost of goods sold by the amount of intra-group sales of merchandise but some could not make the adjustment correctly
Had difficulties in handling intra-group sales with 2 different profit margins normal margin treated as mark-up on costs understatement of cost of goods sold and overstatement of gross profit
Not able to calculate and adjust depreciation overcharged arising from upstream sale of office equipment and the depreciation undercharged on the revalued land and building
Debentures of Sea Ltd acquired on 1.7.2009 debenture interest for 6 months should be deducted from both the income from investment and finance costs
Most candidates were able to reduce retained profits and MI with amounts of unrealised profits on intra-group sale of office equipment and depreciation adjustment on revalued land and building but some omitted the fair adjustment from MI
ment for the returned cheque repeated the accounting entries made without considering the impact of the returned cheque on accrued expenses and prepaid insurance
NBV of the new office equipment should be calculated by taking into account the NBV of the disposed office equipment and depreciation on the old office equipment Depreciation + NBV = Cost of the new office equipment
Trade-in allowance should be excluded in computing the amount of cash paid for purchase of office equipment