Question Tag: IAS 1

Search 500 + past questions and counting.

  • Filter by Professional Bodies

  • Filter by Subject

  • Filter by Series

  • Filter by Topics

  • Filter by Levels

  • 20 Marks

CIBG – FRPA 2022 – L3 – Q1B – Easy Way Limited Financial Statements

Prepare the statement of comprehensive income and statement of financial position for Easy Way Limited as at 31 December 2021 using the given trial balance and additional information.

EASY WAY LIMITED

The list of balances of Easy Way Limited shows the following balances at 31st December 2021.

Dr GH¢000 Cr GH¢000
Share capital (600,000 shares) 320
General reserve 20
Accumulated profit 1 January 2021 50
Inventory (goods for resale) at 1 January 2021 60
Revenue 1,000
Purchases 540
Purchases returns 26
Sales returns 28
Carriage outwards 28
Warehouse wages 80
Sales representatives salaries 60
Administrative wages 40
Warehouse plant and equipment cost 126
Accumulated depreciation — 1 January 2021 50
Delivery vehicle hire 20
Goodwill 100
Distribution expenses 10
Administrative expenses 30
Directors’ salaries (charge to administrative expenses) 30
Rental income 16
Trade receivables 330
Cash at bank 60
Trade payables 60
1,542 1,542

The following additional information has been provided: (1) Inventory of goods for resale at 31 December 2021 amounted to GH¢100,000. (2) Annual depreciation on warehouse plant and equipment of GH¢32,000 should be provided. (3) Income tax expense for 2021 amounts to GH¢50,000. (4) The recoverable amount of goodwill was GH¢90,000.

You are required to prepare: a) the company’s statement of comprehensive income for the year to 31 December 2021; and b) a statement of financial position at that date in accordance with IAS 1: Presentation of Financial Statements. (20 marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "CIBG – FRPA 2022 – L3 – Q1B – Easy Way Limited Financial Statements"

  • 15 Marks

CR – May 2016 – L3 – Q5 – Integrated Reporting

Discuss the purpose of Management Commentary, why it is not mandatory, and the most relevant elements for Umu Amaeshi Plc to focus on in its management commentary.

Umu Amaeshi Plc is a conglomerate that has diverse businesses cutting across some social and environmental sensitive sectors listed on the Nigeria Stock Exchange. In compliance with financial reporting regulatory directives of Nigeria, it has adopted IFRS in preparing its financial statements. The board is aware that this step will enhance the transparency of its reporting and assist in attracting foreign institutional investors who may be desirous of investing in Nigeria. However, in one of the company’s board meetings, the CFO briefed members that given the social and environmental sensitive nature of its operation, the adoption of IFRS may not be good enough to bring that transparency relating to its policies and practices relating to social and environmental disclosures. He makes reference to Para 14 of IAS 1 – Presentation of Financial Statements, which clearly stated that:

“Many entities also present, outside the financial statements, reports and statements such as environmental reports and value-added statements, particularly in industries in which environmental factors are significant and when employees are regarded as an important user group. Reports and statements presented outside financial statements are outside the scope of IFRS.”

The board does not want to engage in social and environmental reporting disclosures since many who do engage in what the business community see as marketing and reports filled with rhetoric. The CFO has therefore suggested the use of Management Commentary.

Required:

a) Briefly explain the purpose of Management Commentary and why it was not made a mandatory requirement for all companies by the IASB. (6 Marks)

b) Identify the three most relevant elements of Management Commentary that Umu Amaeshi Plc should focus on in its management commentary and explain how they will assist the company to achieve the above objectives, given that it does not want to engage in social and environmental disclosure. (9 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "CR – May 2016 – L3 – Q5 – Integrated Reporting"

  • 7 Marks

CR – May 2023 – L3 – Q5b – Presentation of Financial Statements (IAS 1)

Discuss the importance of optimal disclosure and barriers to reducing excessive disclosures in annual reports.

There have been various arguments globally about the extent of disclosures in the annual reports of companies. Some argue that annual reports should include more extensive disclosures, while others believe that efforts should focus on reducing the quantity of information to avoid overwhelming users of financial statements.

The latter perspective suggests that excessive disclosure is burdensome and may obscure key information. Conversely, some argue that there is no such thing as providing too much useful information to users of financial statements.

Required:

Discuss why it is important to ensure that an optimal level of disclosure is made in annual reports. Also, identify and explain the barriers that may exist when trying to reduce excessive disclosure of information in an annual report. (7 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "CR – May 2023 – L3 – Q5b – Presentation of Financial Statements (IAS 1)"

  • 8 Marks

CR – May 2023 – L3 – Q1b – Financial Instruments (IFRS 9, IAS 32, IAS 39)

Discuss IFRS 9 rules on derecognition of financial assets, apply these rules to factoring, and analyze ethical implications of falsifying a land sale.

The directors of Omi PLC reviewed the group statement of financial position as of November 30, 2020. Concerned about meeting future loan agreements, they proposed the following actions to improve liquidity:

  1. Factoring of Receivables:
    • Factoring N400 million of receivables.
    • 80% cash is received immediately (N320 million), and the factoring company charges N32 million.
    • The balance will be paid 30 days later.
  2. Adjusting Financial Statements:
    • The executive director suggested falsifying financial statements to show that land located in Ikoyi was sold before year-end to improve liquidity.

Required:

  • Discuss the rules of IFRS 9 – Financial Instrument on derecognition of financial assets.
  • Apply these rules to factoring in part (1).
  • Discuss the ethical implications of falsifying the sale of land in part (2).

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "CR – May 2023 – L3 – Q1b – Financial Instruments (IFRS 9, IAS 32, IAS 39)"

  • 10 Marks

FR – Nov 2023 – L2 – Q7b – Presentation of Financial Statements (IAS 1)

Lists minimum line items for the statement of financial position and changes in equity as per IAS 1

IAS 1- Presentation of Financial Statements provides a list of line items that, as a minimum, must be shown on the face of the statement of financial position.

Required:

i. Give FIVE examples of minimum line items to be shown on the face of the statement of financial position. (5 Marks)
ii. State FIVE items that should be accounted for in the statement of changes in equity. (5 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FR – Nov 2023 – L2 – Q7b – Presentation of Financial Statements (IAS 1)"

  • 10 Marks

FR – Nov 2014 – L2 – Q4a – Presentation of Financial Statements

Explain the essential characteristics of assets and features of liabilities per IAS 1.

The International Financial Reporting Standards (IFRS) through the International Accounting Standards Board (IASB) set out the definition and essential characteristics of assets and liabilities in the presentation of financial statements, which users of the statements are likely to rely on when making major economic decisions.

Required:

Identify the essential characteristics of assets and comment on the features of liabilities in accordance with provisions of IAS 1 on the presentation of financial statements. (10 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FR – Nov 2014 – L2 – Q4a – Presentation of Financial Statements"

  • 16 Marks

FR – Nov 2019 – L2 – Q1b – Presentation of Financial Statements (IAS 1)

Prepare financial statements for Uchena Nigeria Plc, including profit or loss, changes in equity, and financial position.

The Chief Accountant of Uchena Nigeria plc has just forwarded the trial balance of the company to you for review before the preparation of draft financial statements for the year ended December 31, 2018.

The trial balance is as follows:

Description Debit (N’m) Credit (N’m)
Ordinary share capital 43,200
Revenue 125,280
Staff cost 18,720
Leasehold building 21,600
Patent rights 4,320
Work-in-progress (Jan 1, 2018) 9,000
Accum. Depreciation on building (Jan 1, 2018) 4,320
Inventories of finished goods (Jan 1, 2018) 11,160
Consultancy fee 3,168
Directors’ salaries 25,920
Computer at cost (Hardware) 3,600
Accum. Depreciation on computer (Jan 1, 2018) 1,440
Retained earnings (Jan 1, 2018) 8,712
Dividend paid 9,000
Cash and bank 31,680
Trade receivables 30,240
Trade payables 6,624
Sundry expenses 21,168
Totals 189,576 189,576

Additional information:

  1. On January 1, 2018, buildings were revalued to N25,920 million. This has not been reflected in the accounts.
  2. Computer (hardware) is depreciated over five years. Buildings are now to be depreciated over 30 years.
  3. The patent rights relate to a computer software with a 3-year life span.
  4. An allowance for bad debts of 5% is to be created.
  5. Closing inventories of finished goods are valued at N12,960 million. Work-in-progress has increased to N10,080 million.
  6. There is an estimated liability for current tax of N8,640 million, which has not been recognized.

Required:

  1. Prepare a draft statement of profit or loss (analyzing expenses by nature) for the year ended December 31, 2018. (6 Marks)
  2. Prepare a statement of changes in equity for the year ended December 31, 2018. (4 Marks)
  3. Prepare a statement of financial position as at December 31, 2018. (6 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FR – Nov 2019 – L2 – Q1b – Presentation of Financial Statements (IAS 1)"

  • 20 Marks

FR – Nov 2020 – L2 – Q4 – Presentation of Financial Statements (IAS 1)

Prepare the Statement of Profit or Loss and Other Comprehensive Income for Gbenga Nigeria Plc based on provided trial balance.

Gbenga Nigeria Plc trial balance as at December 31, 2019 is shown below:

Item N’000 N’000
Revenue 2,290,125
Administrative expenses 237,150
Selling and distribution expenses 175,200
Legal and professional expenses 81,150
Allowance for receivables 8,625
Inventories – finished goods – 31/12/18 276,750
Work-in-progress – 31/12/18 49,125
Inventories – raw materials at cost – 31/12/18 162,600
Purchases – raw materials 1,125,900
Carriage inwards – raw materials 15,750
Manufacturing wages 375,000
Manufacturing overheads 187,500
Authorised and issued 900,000 ordinary shares of 50 kobo each fully paid 450,000
150,000 8.4% cumulative preference shares of N1 each fully paid 150,000
Revaluation surplus 65,000
Share premium 150,000
General reserve 85,000
Retained earnings – 31/12/18 425,250
Patents and trademarks 323,250
Motor vehicle at cost 112,500
Freehold property at cost 375,000
Leasehold property at cost 112,500
Plant and equipment at cost 225,000
Furniture and fittings at cost 75,000
Amortisation of leasehold property – 31/12/18 22,500
Accumulated depreciation @ 31/12/2018:
– Plant and equipment 102,750
– Furniture and fittings 23,625
– Motor vehicles 37,500
10% loan notes 150,000
Trade payables 146,250
Trade receivables 266,445
Bank overdraft 76,875
Cash 7,680
4,183,500 4,183,500

Additional information:
(i) A gain of N20,000 made on the revaluation of old freehold property during the year is yet to be accounted for.
(ii) Inventories at December 31, 2019 were:

  • Raw materials: N168,900
  • Finished goods: N413,025
  • Work-in-progress: N56,700

(iii) Legal and professional expenses include solicitor’s fees for purchase of new freehold land during the year of N7,500.
(iv) Provision is to be made for full year’s interest on the loan notes.
(v) The leasehold land and buildings are held on a 50-year lease, with 40 years unexpired life left as at the end of December 31, 2018.
(vi) Depreciation for the year is to be charged as follows:

  • Plant and equipment 8% on cost – charged to production
  • Furniture and fittings 10% on cost – charged to administration
  • Motor vehicles 20% on carrying amount – charged 25% to administration and 75% to selling and distribution.

(vii) Income tax on the profit for the year is estimated at N68,900 and is due for payment on February 28, 2020.

Required:
Prepare the statement of profit or loss and other comprehensive income for the year ended December 31, 2019.

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FR – Nov 2020 – L2 – Q4 – Presentation of Financial Statements (IAS 1)"

  • 20 Marks

FA – Nov 2020 – L1 – SB – Q2 -Accounting Concepts (e.g., Going Concern, Accruals, Materiality)

Explain accounting concepts, provide examples, and list users of financial statements.

a. Explain the term ‘accounting concepts’. (2 Marks)

b. With particular reference to the accounting treatments, explain the following accounting concepts:
i. Entity (2 Marks)
ii. Going concern (2 Marks)
iii. Accrual (2 Marks)
iv. Materiality and aggregation (2 Marks)
v. Consistency (2 Marks)

c. In accordance with IAS 1 – Presentation of Financial Statements, highlight six qualitative characteristics of general-purpose financial statements. (4 Marks)

d. Financial statements provide information to users, and each user’s information requirement is not always the same.

Required:
Using the table below and the example provided, list four users of financial statements and their information needs.

S/N Users Information Needs
1 Employees Wage negotiation and determination of job security
2
3
4

(Total: 20 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FA – Nov 2020 – L1 – SB – Q2 -Accounting Concepts (e.g., Going Concern, Accruals, Materiality)"

  • 1 Marks

FA – Nov 2020 – L1 – SA – Q13 – Elements of Financial Statements

Identifies a component that is not part of the financial statements as defined by IAS 1.

Which of the following is NOT a component of financial statements under IAS 1?
A. Statement of financial position
B. Statement of profit or loss and other comprehensive income
C. Statement of equity
D. Statement of changes in equity
E. Statement of cash flows

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FA – Nov 2020 – L1 – SA – Q13 – Elements of Financial Statements"

  • 20 Marks

CIBG – FRPA 2022 – L3 – Q1B – Easy Way Limited Financial Statements

Prepare the statement of comprehensive income and statement of financial position for Easy Way Limited as at 31 December 2021 using the given trial balance and additional information.

EASY WAY LIMITED

The list of balances of Easy Way Limited shows the following balances at 31st December 2021.

Dr GH¢000 Cr GH¢000
Share capital (600,000 shares) 320
General reserve 20
Accumulated profit 1 January 2021 50
Inventory (goods for resale) at 1 January 2021 60
Revenue 1,000
Purchases 540
Purchases returns 26
Sales returns 28
Carriage outwards 28
Warehouse wages 80
Sales representatives salaries 60
Administrative wages 40
Warehouse plant and equipment cost 126
Accumulated depreciation — 1 January 2021 50
Delivery vehicle hire 20
Goodwill 100
Distribution expenses 10
Administrative expenses 30
Directors’ salaries (charge to administrative expenses) 30
Rental income 16
Trade receivables 330
Cash at bank 60
Trade payables 60
1,542 1,542

The following additional information has been provided: (1) Inventory of goods for resale at 31 December 2021 amounted to GH¢100,000. (2) Annual depreciation on warehouse plant and equipment of GH¢32,000 should be provided. (3) Income tax expense for 2021 amounts to GH¢50,000. (4) The recoverable amount of goodwill was GH¢90,000.

You are required to prepare: a) the company’s statement of comprehensive income for the year to 31 December 2021; and b) a statement of financial position at that date in accordance with IAS 1: Presentation of Financial Statements. (20 marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "CIBG – FRPA 2022 – L3 – Q1B – Easy Way Limited Financial Statements"

  • 15 Marks

CR – May 2016 – L3 – Q5 – Integrated Reporting

Discuss the purpose of Management Commentary, why it is not mandatory, and the most relevant elements for Umu Amaeshi Plc to focus on in its management commentary.

Umu Amaeshi Plc is a conglomerate that has diverse businesses cutting across some social and environmental sensitive sectors listed on the Nigeria Stock Exchange. In compliance with financial reporting regulatory directives of Nigeria, it has adopted IFRS in preparing its financial statements. The board is aware that this step will enhance the transparency of its reporting and assist in attracting foreign institutional investors who may be desirous of investing in Nigeria. However, in one of the company’s board meetings, the CFO briefed members that given the social and environmental sensitive nature of its operation, the adoption of IFRS may not be good enough to bring that transparency relating to its policies and practices relating to social and environmental disclosures. He makes reference to Para 14 of IAS 1 – Presentation of Financial Statements, which clearly stated that:

“Many entities also present, outside the financial statements, reports and statements such as environmental reports and value-added statements, particularly in industries in which environmental factors are significant and when employees are regarded as an important user group. Reports and statements presented outside financial statements are outside the scope of IFRS.”

The board does not want to engage in social and environmental reporting disclosures since many who do engage in what the business community see as marketing and reports filled with rhetoric. The CFO has therefore suggested the use of Management Commentary.

Required:

a) Briefly explain the purpose of Management Commentary and why it was not made a mandatory requirement for all companies by the IASB. (6 Marks)

b) Identify the three most relevant elements of Management Commentary that Umu Amaeshi Plc should focus on in its management commentary and explain how they will assist the company to achieve the above objectives, given that it does not want to engage in social and environmental disclosure. (9 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "CR – May 2016 – L3 – Q5 – Integrated Reporting"

  • 7 Marks

CR – May 2023 – L3 – Q5b – Presentation of Financial Statements (IAS 1)

Discuss the importance of optimal disclosure and barriers to reducing excessive disclosures in annual reports.

There have been various arguments globally about the extent of disclosures in the annual reports of companies. Some argue that annual reports should include more extensive disclosures, while others believe that efforts should focus on reducing the quantity of information to avoid overwhelming users of financial statements.

The latter perspective suggests that excessive disclosure is burdensome and may obscure key information. Conversely, some argue that there is no such thing as providing too much useful information to users of financial statements.

Required:

Discuss why it is important to ensure that an optimal level of disclosure is made in annual reports. Also, identify and explain the barriers that may exist when trying to reduce excessive disclosure of information in an annual report. (7 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "CR – May 2023 – L3 – Q5b – Presentation of Financial Statements (IAS 1)"

  • 8 Marks

CR – May 2023 – L3 – Q1b – Financial Instruments (IFRS 9, IAS 32, IAS 39)

Discuss IFRS 9 rules on derecognition of financial assets, apply these rules to factoring, and analyze ethical implications of falsifying a land sale.

The directors of Omi PLC reviewed the group statement of financial position as of November 30, 2020. Concerned about meeting future loan agreements, they proposed the following actions to improve liquidity:

  1. Factoring of Receivables:
    • Factoring N400 million of receivables.
    • 80% cash is received immediately (N320 million), and the factoring company charges N32 million.
    • The balance will be paid 30 days later.
  2. Adjusting Financial Statements:
    • The executive director suggested falsifying financial statements to show that land located in Ikoyi was sold before year-end to improve liquidity.

Required:

  • Discuss the rules of IFRS 9 – Financial Instrument on derecognition of financial assets.
  • Apply these rules to factoring in part (1).
  • Discuss the ethical implications of falsifying the sale of land in part (2).

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "CR – May 2023 – L3 – Q1b – Financial Instruments (IFRS 9, IAS 32, IAS 39)"

  • 10 Marks

FR – Nov 2023 – L2 – Q7b – Presentation of Financial Statements (IAS 1)

Lists minimum line items for the statement of financial position and changes in equity as per IAS 1

IAS 1- Presentation of Financial Statements provides a list of line items that, as a minimum, must be shown on the face of the statement of financial position.

Required:

i. Give FIVE examples of minimum line items to be shown on the face of the statement of financial position. (5 Marks)
ii. State FIVE items that should be accounted for in the statement of changes in equity. (5 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FR – Nov 2023 – L2 – Q7b – Presentation of Financial Statements (IAS 1)"

  • 10 Marks

FR – Nov 2014 – L2 – Q4a – Presentation of Financial Statements

Explain the essential characteristics of assets and features of liabilities per IAS 1.

The International Financial Reporting Standards (IFRS) through the International Accounting Standards Board (IASB) set out the definition and essential characteristics of assets and liabilities in the presentation of financial statements, which users of the statements are likely to rely on when making major economic decisions.

Required:

Identify the essential characteristics of assets and comment on the features of liabilities in accordance with provisions of IAS 1 on the presentation of financial statements. (10 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FR – Nov 2014 – L2 – Q4a – Presentation of Financial Statements"

  • 16 Marks

FR – Nov 2019 – L2 – Q1b – Presentation of Financial Statements (IAS 1)

Prepare financial statements for Uchena Nigeria Plc, including profit or loss, changes in equity, and financial position.

The Chief Accountant of Uchena Nigeria plc has just forwarded the trial balance of the company to you for review before the preparation of draft financial statements for the year ended December 31, 2018.

The trial balance is as follows:

Description Debit (N’m) Credit (N’m)
Ordinary share capital 43,200
Revenue 125,280
Staff cost 18,720
Leasehold building 21,600
Patent rights 4,320
Work-in-progress (Jan 1, 2018) 9,000
Accum. Depreciation on building (Jan 1, 2018) 4,320
Inventories of finished goods (Jan 1, 2018) 11,160
Consultancy fee 3,168
Directors’ salaries 25,920
Computer at cost (Hardware) 3,600
Accum. Depreciation on computer (Jan 1, 2018) 1,440
Retained earnings (Jan 1, 2018) 8,712
Dividend paid 9,000
Cash and bank 31,680
Trade receivables 30,240
Trade payables 6,624
Sundry expenses 21,168
Totals 189,576 189,576

Additional information:

  1. On January 1, 2018, buildings were revalued to N25,920 million. This has not been reflected in the accounts.
  2. Computer (hardware) is depreciated over five years. Buildings are now to be depreciated over 30 years.
  3. The patent rights relate to a computer software with a 3-year life span.
  4. An allowance for bad debts of 5% is to be created.
  5. Closing inventories of finished goods are valued at N12,960 million. Work-in-progress has increased to N10,080 million.
  6. There is an estimated liability for current tax of N8,640 million, which has not been recognized.

Required:

  1. Prepare a draft statement of profit or loss (analyzing expenses by nature) for the year ended December 31, 2018. (6 Marks)
  2. Prepare a statement of changes in equity for the year ended December 31, 2018. (4 Marks)
  3. Prepare a statement of financial position as at December 31, 2018. (6 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FR – Nov 2019 – L2 – Q1b – Presentation of Financial Statements (IAS 1)"

  • 20 Marks

FR – Nov 2020 – L2 – Q4 – Presentation of Financial Statements (IAS 1)

Prepare the Statement of Profit or Loss and Other Comprehensive Income for Gbenga Nigeria Plc based on provided trial balance.

Gbenga Nigeria Plc trial balance as at December 31, 2019 is shown below:

Item N’000 N’000
Revenue 2,290,125
Administrative expenses 237,150
Selling and distribution expenses 175,200
Legal and professional expenses 81,150
Allowance for receivables 8,625
Inventories – finished goods – 31/12/18 276,750
Work-in-progress – 31/12/18 49,125
Inventories – raw materials at cost – 31/12/18 162,600
Purchases – raw materials 1,125,900
Carriage inwards – raw materials 15,750
Manufacturing wages 375,000
Manufacturing overheads 187,500
Authorised and issued 900,000 ordinary shares of 50 kobo each fully paid 450,000
150,000 8.4% cumulative preference shares of N1 each fully paid 150,000
Revaluation surplus 65,000
Share premium 150,000
General reserve 85,000
Retained earnings – 31/12/18 425,250
Patents and trademarks 323,250
Motor vehicle at cost 112,500
Freehold property at cost 375,000
Leasehold property at cost 112,500
Plant and equipment at cost 225,000
Furniture and fittings at cost 75,000
Amortisation of leasehold property – 31/12/18 22,500
Accumulated depreciation @ 31/12/2018:
– Plant and equipment 102,750
– Furniture and fittings 23,625
– Motor vehicles 37,500
10% loan notes 150,000
Trade payables 146,250
Trade receivables 266,445
Bank overdraft 76,875
Cash 7,680
4,183,500 4,183,500

Additional information:
(i) A gain of N20,000 made on the revaluation of old freehold property during the year is yet to be accounted for.
(ii) Inventories at December 31, 2019 were:

  • Raw materials: N168,900
  • Finished goods: N413,025
  • Work-in-progress: N56,700

(iii) Legal and professional expenses include solicitor’s fees for purchase of new freehold land during the year of N7,500.
(iv) Provision is to be made for full year’s interest on the loan notes.
(v) The leasehold land and buildings are held on a 50-year lease, with 40 years unexpired life left as at the end of December 31, 2018.
(vi) Depreciation for the year is to be charged as follows:

  • Plant and equipment 8% on cost – charged to production
  • Furniture and fittings 10% on cost – charged to administration
  • Motor vehicles 20% on carrying amount – charged 25% to administration and 75% to selling and distribution.

(vii) Income tax on the profit for the year is estimated at N68,900 and is due for payment on February 28, 2020.

Required:
Prepare the statement of profit or loss and other comprehensive income for the year ended December 31, 2019.

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FR – Nov 2020 – L2 – Q4 – Presentation of Financial Statements (IAS 1)"

  • 20 Marks

FA – Nov 2020 – L1 – SB – Q2 -Accounting Concepts (e.g., Going Concern, Accruals, Materiality)

Explain accounting concepts, provide examples, and list users of financial statements.

a. Explain the term ‘accounting concepts’. (2 Marks)

b. With particular reference to the accounting treatments, explain the following accounting concepts:
i. Entity (2 Marks)
ii. Going concern (2 Marks)
iii. Accrual (2 Marks)
iv. Materiality and aggregation (2 Marks)
v. Consistency (2 Marks)

c. In accordance with IAS 1 – Presentation of Financial Statements, highlight six qualitative characteristics of general-purpose financial statements. (4 Marks)

d. Financial statements provide information to users, and each user’s information requirement is not always the same.

Required:
Using the table below and the example provided, list four users of financial statements and their information needs.

S/N Users Information Needs
1 Employees Wage negotiation and determination of job security
2
3
4

(Total: 20 Marks)

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FA – Nov 2020 – L1 – SB – Q2 -Accounting Concepts (e.g., Going Concern, Accruals, Materiality)"

  • 1 Marks

FA – Nov 2020 – L1 – SA – Q13 – Elements of Financial Statements

Identifies a component that is not part of the financial statements as defined by IAS 1.

Which of the following is NOT a component of financial statements under IAS 1?
A. Statement of financial position
B. Statement of profit or loss and other comprehensive income
C. Statement of equity
D. Statement of changes in equity
E. Statement of cash flows

Login or create a free account to see answers

Login
Register

Find Related Questions by Tags, levels, etc.

Report an error
Report an error

You're reporting an error for "FA – Nov 2020 – L1 – SA – Q13 – Elements of Financial Statements"

knowsia

Elevate your professional expertise across key business domains with our comprehensive training programs

Our offerings

Community

Contact Info

  • +233203701923
    +233543919232
  • info@knowsia.com

Customer

Get In Touch

Follow us on our social media and get daily updates.

Facebook-f Twitter Linkedin-in Envelope
Oops!

This feature is only available in selected plans.

Click here to view all plans

Click on the login button below to login if you’re already subscribed to a plan or click on the upgrade button below to upgrade your current plan.

Login
Upgrade Plan

If you’re not subscribed to a plan, click on the button below to choose a plan

Subscribe to a plan

Pick a Form

Professional Tutor Application Form
Academic Tutor Application Form
Student Tutor Application Form