CIMA Exam CIMAPRA19-F01-1 Topic 4 Question 91 Discussion

Actual exam question for CIMA's CIMAPRA19-F01-1 exam

Question #: 91
Topic #: 4

The following information relates to AA.

Extract of Trial Balance at 31 December 20X4;

Notes

(i) Inventory at 31 December 20X4 was valued at cost at $30.

(ii) The loan which was received on 1 July 20X4 is repayable in 20X9.

(iii) Corporate income tax represents an over-provision of tax for the year ended 31 December 20X3. AA reported a loss for tax purposes for the year ended 31 December 20X4 and a tax refund is expected amounting to $20.

(iv) Cost of sales, administration and distribution costs need to be adjusted for the following:

What figures should be entered on the face of the Statement of profit or Loss for the year ended 31 December 20X4 in relation to Interest and Corporate income tax?

AInterest $25 Corporate income tax $(37)

BInterest $25 Corporate income tax $37

CInterest $50 Corporate income tax $(3)

DInterest $50 Corporate income tax $3

Show Suggested Answer

Suggested Answer: A

by Mendy at Jul 01, 2024, 01:02 PM

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Shoshana

5 months ago

Wait, wait, wait... Did they really expect us to do math on this exam? I thought this was a certification, not a math competition! Anyway, I'm going with D, because it's the only one that makes sense to me.

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Zana

4 months ago

Yeah, D makes sense to me as well. Let's go with that.

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Mona

4 months ago

I agree, D seems to be the most reasonable option based on the information provided.

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Sherron

4 months ago

I think D is the correct answer too. It seems like the most logical choice.

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Nu

4 months ago

Let's go with D then. Hopefully, we got it right.

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Jesse

4 months ago

Yeah, I agree. The other options don't really make sense based on the information provided.

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Luther

4 months ago

I think D is the correct answer too. It seems to be the most logical choice.

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Ezekiel

5 months ago

I agree with Linette, the correct answer should be A.

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Linette

5 months ago

But the notes mention that there is a tax refund expected, so it should be $(37) not $37.

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Chu

5 months ago

This question is like a game of 'Find the Mistakes'! Let's see, the interest should be $50 and the corporate income tax should be $(3). I'm going with D, but I still feel like I'm missing something.

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Ma

5 months ago

User 2

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Arminda

5 months ago

User 1

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Rolland

5 months ago

Hmm, I'm a bit confused. Shouldn't the interest be $25 since the loan was received on 1 July 20X4? And the corporate income tax seems to be an over-provision, so shouldn't it be $(37)? I'm going with B.

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Eliz

4 months ago

Great, let's go with option B for the figures to be entered on the face of the Statement of Profit or Loss for the year ended 31 December 20X4.

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Berry

4 months ago

Definitely, option B seems to be the most accurate choice based on the information provided.

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Jolene

4 months ago

Yes, that makes sense. So, we both agree on option B then.

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Lisbeth

5 months ago

I think you're right, the interest should be $25 because of the loan received in July. And the corporate income tax should be $(37) due to the over-provision.

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Mari

6 months ago

Okay, let's see. The loan is repayable in 20X9, so the interest should be $50. And since there's a tax refund expected, the corporate income tax should be $(3). Looks like D is the correct answer.

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