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ICAEW ACA ACCOUNTING EXAM BRAND
NEW ACTUAL EXAM WITH ANSWERS.
Disposal for cash consideration - correct answer -1) Remove the
original cost of NCA from its account.
2) Remove Acc. depreciation on the NCA from the Acc. Depr
account
3) Record the cash proceeds.
Meaning of Impairment - correct answer -• The value of the asset
is less than its carrying amount.
• Additional depreciation charge is made to the SPL to write it to
its impaired value.
• No alteration to the cost account; Acc.depr account will reflect
the higher depreciation charge.
Non-current asset register - correct answer -• A list of all the non-
current assets of the business.
• Broken down normally by location and asset type.
• Maintained in order to control NCAs and keep track of what is
owned and where it is kept.
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Intangible non-current assets - correct answer -Assets held for the
long term which have no physical form.
e.g Patents, Copyrights, Licences
Properties of Intangible Assets - correct answer -• If they have a
useful life - they are amortised over the useful life.
• The amortisation is an expense in SPL.
• Internally generated intangibles do not appear on SFP as too
difficult to climate value.
Amortisation - correct answer -Depreciation of Intangibles
Goodwill - correct answer -The excess value of a business above
the carrying amount of its assets less its liabilities in its accounting
records.
Sources of goodwill - correct answer -• Reputation
• Skills
• Experience of staff
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• Customer relationship
Exceptions regarding goodwill - correct answer -• Where goodwill
is purchased in the acquisition of another business.
• If recognised goodwill is reviewed annually for impairment rather
than being depreciated or amortised.
Properties of R&D expenditure - correct answer -• Research costs
are charged to SPL.
• Certain criteria met, development expenditure must be shown as
a NCA on SFP.
• If the case, amortisation used to to reflect use of asset when
recorded.
Irrecoverable Debt - correct answer -A debt which the business
believes will never be paid.
Ways an irrecoverable debt may arise - correct answer -•
Bankruptcy of a customer
• Disappearance of customer
• Outright refusal to pay
ICAEW ACA ACCOUNTING EXAM BRAND
NEW ACTUAL EXAM WITH ANSWERS.
Disposal for cash consideration - correct answer -1) Remove the
original cost of NCA from its account.
2) Remove Acc. depreciation on the NCA from the Acc. Depr
account
3) Record the cash proceeds.
Meaning of Impairment - correct answer -• The value of the asset
is less than its carrying amount.
• Additional depreciation charge is made to the SPL to write it to
its impaired value.
• No alteration to the cost account; Acc.depr account will reflect
the higher depreciation charge.
Non-current asset register - correct answer -• A list of all the non-
current assets of the business.
• Broken down normally by location and asset type.
• Maintained in order to control NCAs and keep track of what is
owned and where it is kept.
, Page | 2
Intangible non-current assets - correct answer -Assets held for the
long term which have no physical form.
e.g Patents, Copyrights, Licences
Properties of Intangible Assets - correct answer -• If they have a
useful life - they are amortised over the useful life.
• The amortisation is an expense in SPL.
• Internally generated intangibles do not appear on SFP as too
difficult to climate value.
Amortisation - correct answer -Depreciation of Intangibles
Goodwill - correct answer -The excess value of a business above
the carrying amount of its assets less its liabilities in its accounting
records.
Sources of goodwill - correct answer -• Reputation
• Skills
• Experience of staff
, Page | 3
• Customer relationship
Exceptions regarding goodwill - correct answer -• Where goodwill
is purchased in the acquisition of another business.
• If recognised goodwill is reviewed annually for impairment rather
than being depreciated or amortised.
Properties of R&D expenditure - correct answer -• Research costs
are charged to SPL.
• Certain criteria met, development expenditure must be shown as
a NCA on SFP.
• If the case, amortisation used to to reflect use of asset when
recorded.
Irrecoverable Debt - correct answer -A debt which the business
believes will never be paid.
Ways an irrecoverable debt may arise - correct answer -•
Bankruptcy of a customer
• Disappearance of customer
• Outright refusal to pay
