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ALL ANSWERS ARE EXAM PURPOSES ONLY (AS ALWAYS) 🙂
Two distinct stages:
Stage 1
Build asset
End of Stage 1 – asset complete – there will be no further adjustments to CA of asset / capitalisation of interest
Stage 2
Start to depreciate
Have a go at the spreadsheet exercises at https://opentuition.com/acca/sbr/
Otherwise all I can think of is recent past question practice from ACCA platform
If your double entry feels rusty perhaps look back at some our FA materials.
Best I can do
🙂
IFRS 5
NCA held for sale – maesure at lower of CA and FV less disposal costs; classify as current asset
No reference in the scenario to ownership passing at the end of the lease.
So, shorter of life and lease term
Something that I would only think about if payment was in arrears.
I see your point, but, in the exam, above all, keep it simple. 🙂 That’s what accountants should be doing. My vote is with your mystery tutor.
If you buy land: Dr IP / PPE Cr Cash (IP if held for investment potential)
No development = no double entry
No depreciation
Possible impairment if land values fall significantly : DR P&L CR PPE
1. Yes
2. YesCapitalisation would cease if there was an interruption.
No further knowledge really needed for exam purposes.
As previously stated, the extra 20 is not recognised.
No imbalance – no debit and no credit.
🙂
Please watch my debriefs of exams and of the spreadsheets for assistance.
https://opentuition.com/acca/sbr/acca-strategic-business-reporting-sbr-revision-kit-live/
1. Reverse initial loss of 20 but do not recognise the extra 20. Carry at lower of CA (at time of classification as HFS) and FVCTS.
2. Value in use not relevant if HFS, as we are selling not using.🙂
Hi. Pleased that you are enjoying the lectures.
At the moment we don’t have the resources to debrief any further exams.
Don’t forget to make use of the ACCA hub.
🙂
I would get straight on with the SBR. Just make sure that you spend more time on accounting standards than on consolidations.
🙂
We’d work it out manually – so each asset liability will have its own exchange difference – but not something the examiner would ask us to do.
In parent’s accounts:
Dr Investment in sub Cr Cash
being consideration for extra 20%
🙂
My answer:
1. Recognise at 10 at the purchase day – ‘cost’.
2. Recognise a tax liability at that date of 1. I think it might form part of the cost – you have to pay it if you buy the asset. (Dr IP Cr Tax liability)
3. Do not recognise the gain of 4 because our policy is to hold the asset at cost.The examiner at the time was looking for your discussion and knowledge rather than the specific answer.
The two 2s are in respect of separate adjustments, but I still don’t have enough information. I can see that the gain on the land would go to K’s P&L and therefore RE, but I’m not sure what the other adjustment was.
Where have you sourced Kutchen please? I know there are now several different versions.
Thanks
Steve
