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Hi
Could you please help me how to work out the answer to the below question?The asset register shows a carrying value for non current assets of $85,600; the ledger accounts include a cost balance of $185,000 and an accumulated depreciation balance of $55,000. Which of the following may expalin the discrepancy?
The correct answer is: The omission of an upwards revaluation by $16,400 form the register and the accidental debiting of the depreciation charge of $28,000 to the accumulated depreciation ledger account.
Asset registrer
Carrying value per question 85,600
Addition of land 30,000
= 115,600Ledger accounts
Carrying value per question 130,000
Disposalat carrying value (14,400)= 115,600
I don’t understand how to worked out the additon of land and the disposal at carrying value
thanks
Gabbi
I have no idea either!
I can only think that you have missed out some of the question (or the answer).
(The first three lines after ‘correct answer’ are of course correct. The rest of the answer you have typed makes no sense)I am not in a position to explain what is in books published by others.
HI John,
No problem. I copied the question as written on the book. It makes no sense to me either.
Thanks a millionGabbi
HI JOHN
The following balances existed in the accounting records of Kappa Co. 31.12.2007
Development costs capitalised, 1.01.2007 180 Research and development expenditure for the year 162
Preparing company statement of comprehensive income and statement of financial position at 31 12.2007 the following further information is relevant.
a)the 180000 total for development costs as at 1.01.2007 related 2 projects.
Project 836:completed project
(balance being amortised over the period expected to benefit from it) 82
Amount to be amortised in 2007 : 20000
Project 910: in progress 98
180b)The research and development expinduture for the year is made up of
Research expenditure 103
Development costs on project 910 which continues to satisfy the requirements in IAS 38 for capitalisation. 59162
According to IAS 38 Intangible assets what amount should be charged in the statement of comprehensive income for research and development costs for the year ended 31 december 2007
Why answer is 103000+20000=123000 not 103000+59000Question 2)
According to IAS 38 what amount should be disclosed as an intangible asset in the statement of financial position for the year ended 31/12.2007219000
180000
160000
5900020,000 is the amortisation for this year (per the question) and will appear in the Statement of comprehensive income.
59,000 will not appear – it is the amount to be capitalised (and will start to be amortised only when the project is complete)
Q2:
The balance brought forward is 180,000.
Subtract the amortisation for this year: 20,000
Add the extra to be capitalised this year: 59,000
So total is 219,000
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