AC

Question 1

What is SOPL and SOFP

Answer 1

Statement of financial position shows how things are right now, and gives a snapshot of what business is holding

Statement of profit and loss shows business before minutes through the year

Question 2

What is included in the statement of financial position?

Answer 2

1. Asset
2. Capital
3. Liabilities.

Question 3

What is the structure of statement of profit and loss?

Answer 3

1. Revenue
2. Cost of sales (Opening inv + purchases - closing inv)
3. Total gross profit
4. List extra expenses
5. This gives operating profit
6. Deduct tax
7. This gives the net profit.

Question 4

What is capital and revenue expenditure?

Answer 4

Capital expenditure relates to buying a NCA oh improving it

Revenue expenditure relates to day-to-day expenses, such as maintaining assets, materials and salaries

Question 5

What are the five key principles?

Answer 5

Integrity
Objectivity
Professional competence
Confidentiality
Professional behaviour