FR – Klopp Co Exam-Based Question

I have a couple of issues with the Solution on this piece:

1. The extracts from the TB states that they were balances as at 30 June 20X8, but the tutor treated as though they were balances as at 30 June 20X7. I need clarity on this, as I initially worked my balances back to 20X7 on Share Capital, by deducting the balances said at 20X8 from the new issue on 1 Jan 20X8 (2,400 – 1,080) (where 1,080 is 600 * 1.8) to arrive at 1,320 which i then used as bal as at 20X7 b/f in SOCIE. It was only retained earnings that was clear from the question as balance at 20X7. I would like to understand why the tutor did this differently.

This also made me feel the retained earnings was wrong as I have calculated previous period declaration of dividend to be (0.05 * 1,320) where 1,320 was the share capital balance at 20X7 before the new issue based on the dates mentioned above. Then, I calculated the interim dividend as (0.04 * 2400) where 2,400 is the share capital balance after the new issue. My total dividend was ( 1,320 * 0.05) + (2400* 0.04) = 66+96 = 162.

2. The share issue was not said to have been issued at premium, but the tutor calculated share capital issue at $1 per unit and $0.8 taken to share premium. Am I to assume that all new issues of shares are at par of $1 in exam?. Kindly expatiate.

3. Lastly, the revaluation of assets seems incorrect, the question stated that both the land and building were originally bought in 20X2, while revaluation was in 20X7, this means 5 years accumulated depreciation ought to be deducted from the cost of buildings before the revaluation, while the remaining useful life after revaluation is 45 years and subsequent depreciation is revalued amount divided by 45 (5,400 / 45). This is based on what I have learnt so far in the lectures. However, the tutor seem to have missed the accumulated depreciation and went straight to revaluing the assets and arriving at revaluation gains based on Revalued Amount – Cost.

I really appreciate the platform, and I would love to learn more about this points.