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- August 30, 2020 at 9:26 am #582703
I am confused on this part:
Please correct me on the below.
IFRS 16: for a lease contract to exist, the lessee ( the user of the asset) need to have right to:
1) Obtain substantially all the economic benefits from use of the asset
2) direct use of the assetHere: Lifeson has sold the property to Clive and then lease it back for 10 years.
Lifeson will obtain ‘part’of the economic benefits from use of the asset. It does not say Lifeson can direct the use of the asset or (I assume that Clive will direct it).
So how can I recognise it as lease in the FS of Lifeson?
August 28, 2020 at 10:38 am #582468Thank you so much.
August 28, 2020 at 9:58 am #582463Lets say:
Cost: 2000, Depreciation: 500
Capital allowance y1: 800, y2: 600
Tax rate: 25%Carrying value in y1: 2000-500= 1500
Tax base: 2000- 800= 1200
Temporary difference= 300
Deferred tax liability: 25% × 300= 75Now lets says that depreciation has reduced to 400
Cv in y1: 2000-400=1600
Tax base: 1200
Temp.diff: 400
Defer tax liabilty: 25% ×400= 100Deferred tax liabilty has increased to 100= equivalent decrease in depreciation.
Is my understanding correct?
*So based on the scenario in the past exam it will increase but not significantly, may indicate overstatement of liability.
July 26, 2020 at 6:40 am #578073Clearer now.
Thank you.December 5, 2019 at 10:46 am #555057Thank you.
November 28, 2019 at 2:10 am #553962Thank you John.
November 27, 2019 at 4:19 pm #553937Since my next question is related to your answer above, I am continuing on the same thread.
Sigra co 12/12
Gain under share exchange – offer of 3 of its shares for 2 of dentro co shares.To calculate share price of combined co:
If we assume in this case too that the no of shares is: sigra: 11000 + dentro 1250 = 12,250,000 instead of 12,875,000 will it be correct?November 27, 2019 at 1:23 pm #553910Thank you
November 25, 2019 at 3:21 pm #553720Sorry I mean deduct the $ 1200.
Isn’t it capital expenditure?
To get the cash flow don’t we have to deduct it?Thank you.
November 22, 2019 at 7:27 am #553375Thank you.
Another question:
Why the additional investment $1200 is not added back?And to calculate equity value of mining unit:
corporate value – NCL ( bank overdraft of 1800). CL payables 750 is ignored?November 19, 2019 at 1:59 am #553040Thank you.
Another question : march 2018 Tippletine Co
1 b) I find part b difficult. But it was simply to discuss the adv & disad of convertible loan notes.The other shareholders may be concerned by the interest rate on the convertible notes being Tippletine Co’s normal cost of borrowing. The option to convert is an advantage for convertible loan note holders. They would often effectively pay for this option by receiving a lower rate of interest on the loan notes.
Can you please explain this to me. How come they receive a lower rate of IR?
November 4, 2019 at 4:09 pm #551552Thank you 🙂
December 5, 2017 at 1:21 pm #420650ignore the above pls..
November 24, 2017 at 8:10 am #417743Thank you Ken. 🙂
Assuming 25% improvement, then how much it will generate in terms of cost savings? did the examiner calculate it based on the figures? the $4 cost saving refers to the scrap value figures.
Another question: Dec 2016 Question 2(a)
How is the exchange rate calculated for the cost of sales figures?
Previous rate: C$1= V$1.40 and current rate: C$1 = V$1.50why is it deducted from minus 1 (-1) ?
Also, how is the fuel tax increase for the distribution costs calculated?
3/160?November 24, 2017 at 7:39 am #417738Thank you Ken. 🙂
Assuming 25% improvement, then how much it will generate in terms of cost savings? did the examiner calculate it based on the figures? the $4 cost saving refers to the scrap value figures.
Another question: Dec 2016 Question 2(a)
How is the exchange rate calculated?
Previous rate: C$1= V$1.40 and current rate: C$1 = V$1.50why is it deducted from minus 1 (-1) ?
November 14, 2016 at 11:10 am #348872I got it. Please ignore.
June 4, 2015 at 5:41 pm #253232Thanks a lot.. 🙂
Was confused about what to include in prior charge capital.
November 30, 2014 at 10:39 am #214687Dear,
I have used this method for secure net.
operational price variance = (actual price – std price)X actual kgs
planning price variance = (std price – revised price) X actual kgsoperational usage variance = (actuals kgs for actual production – revised kgs for actual production) X std kg
planning price variance = (std kgs for actual production – revised kgs for actual production) X std price.Please confirm if i can use this method. (like in Truffle and Bedco Manufacturers Dec 2013)
November 28, 2014 at 1:08 pm #214102I got confused when the rate changed to 95%.
It was simply applying the rule ‘ Every time we double production, the average time falls to a percentage of the previous average time.’
Thanks a lot. 🙂
November 17, 2014 at 12:14 pm #210676please provide the link for the alternative answer. i can’t find it on open tuition.
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