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VAT on Bad debt written off

  • Member
  • Practice Licence
  • 34 posts
  • # 78047

I recently passed my Level II manual exam but was very disappointed that I only got 83%.  Having looked at the report showing where I went wrong I have lost 16 marks due to 1 thing!!!

The paper said that there was a bad debt which was to be written off, of say £500.

In the answer I wrote off the debt the balance sheet, and debited the P&L with say £417 and debited the VAT control account with say £83 (I can't remember the exact figures).  Is this not correct?

Because of this I have lost marks because:
- the bad debt w/off charge to the P&L was wrong
- the total of the expenses in the P&L was wrong
- the profit was wrong
- the VAT liability was wrong
- the total of the creditors was wrong
- net assets on the balance sheet was wrong
- the figures on the VAT return were wrong
- etc, etc, etc.

Do you not take into account VAT on bad debts, and if not, why?

It seems totally mad that I lost so many marks because of 1 thing!!!
Ann Marie Spickett
  • Member PM.Dip
  • Practice Licence
  • 33 posts
  • # 78048

Hi Jojo, sorry to hear you're disappointed with your results. Just thought I should mention, that we're not meant to discuss actual exam questions on the forum, for obvious reasons.     
It might be worth giving the ICB a ring in the morning, or maybe your tutor could help clarify.
Kind regards
Ann                      
jitterbug1963
  • 23 posts
  • # 78049

Hi Jojo


It does seem a bit harsh but I imagine as exam is done via computer the answer can only be right or wrong ( No human intervention).


Steve

Edited at 05 Jan 2012 06:17 PM GMT

Edited at 05 Jan 2012 06:22 PM GMT
jitterbug1963
  • 23 posts
  • # 78085

Hi James

Sorry if I came across wrong but I agree with you that an error is an error.
The one thing I have found through my studies so far is the importance on getting everything correct.


Regards
Steve 
  • Member
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  • 34 posts
  • # 78087

Hi James

I've sent an email through asking if someone could send me a copy of the question.

I'm sure that the question said the debt was over 6 months old, and according the the HMRC website if a debt is over 6 months old you can claim the VAT back.  If the question does state that, then my answer was actually correct.

Can you look into please?

Thanks
  • Member
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  • 34 posts
  • # 78171

Well that's that I guess...

Have received and email back from stating that the admins within the ICB are not in a position to answer such questions and if I want my paper checked over I have to pay another £25!  There's no way I'm going to pay another £25 for a paper that already cost me £60 to sit...


On a brighter note I've just checked, and my results for the computerised paper are through - 94% (Distinction) woo hoo!!!



Edited at 10 Jan 2012 11:13 AM GMT

Edited at 11 Jan 2012 11:13 AM GMT
  • Member
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  • # 78205

.

Edited at 11 Jan 2012 11:25 AM GMT
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