Chapter 26 - practice questions

3 months in a quarter, 2 months from 31 May to 31 July, $5 million per quarter, $1,666,667 per month, 2 months, $3,333,333 For question 3, there is a mistake in the answer that is identified as correct. The correct answer should be $19,950 You are correct to select nsp $21,000 as the appropriate choice as at 1 March, 2014 and this needs a further 3 months' amortisation. But the useful file has been re-estimated as being 5 years from the date of the review So, $21,000 / 5 / 4 = $1,050 and that will reduce the carrying value on SoFP to $19,950 "What am I doing wrong, please?" - you are incorrectly deducting the $3 million amortisation from the pre-reassessment period. That is automatically adjusted when you made your choice between $25,000 and $21,000 OK?

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