ACC705 Individual Assignment

Choose Your Topic

All Subject Accounting Finance Engineering Science Computer Science

Economics Management Writing Mathematics Statistics Law Auditing Nursing Childcare Others

ACC705 Individual Assignment

Question Preview:

View Complete Question >>

Question Preview:

Question 1 (15 marks) Business combination valuation entries, pre-acquisition entries On 1 July 2016, Merelyn Ltd acquired all the issued shares of Cathy Ltd for $220 800. At this date the equity of Cathy Ltd consisted of share capital of $100 000 and retained earnings of $58 800. All the identifiable assets and liabilities of Cathy Ltd were recorded at amounts equal to fair value except for: Carrying amount Fair value Patent $70 000 $72 000 Plant (net of $40 000 depreciation) 40 000 60 000 Inventory 21 600 28 000 The patent was considered to have an indefinite life. It was calculated that the plant had a further life of 10 years, and was depreciated on a straight-line basis. All the inventory was sold by 30 June 2017. In June 2017, Cathy Ltd conducted an impairment test on the patent, as it was considered to have an indefinite life, and the goodwill. As a result, the goodwill was considered to be impaired by $1300. In May 2017, Cathy Ltd transferred $30 000 from the retained earnings on hand at 1 July 2016 to a general reserve. The tax rate is 30%. Required Prepare the consolidation worksheet adjustments entries at 1 July 2016 and 30 June 2017. Question 2 (15 marks) A junior accounts clerk has prepared the following summarised information as at 30 June 2016 for Heaven Ltd: Assets Inventories (at lower of cost and net realisable value) Accounts receivable Cash Land and buildings Plant and equipment Prepayments Calls in arrears (2500 shares at 20c) Patents — cost $970000 651020 1598080 1750000 1716000 3400 500 100000 $6789000 Liabilities and equity Retained earnings (30/6/16) Liabilities Share capital (5000000 shares) Reserves and provisions 575480 1038520 4086000 1089000 $6789000 Upon further investigation, you have discovered the following additional information: (a) Liabilities of $1038520 comprise: Accounts payable Accrued expenses Mortgage loans $790000 8520 240000 (b) Reserves and provisions of $1089000 include: Employee benefits (payable after 1 July 2023) Current tax liability Dividends Allowance for impairment of receivables Accumulated depreciation – plant and equipment Accumulated depreciation – buildings Accumulated amortisation – patents $400000 160000 200000 10000 72000 207000 40000 (c) Cash of $1598080 consists of: Cash at bank 10% Telstra bonds (regarded as long-term investments) $298080 1300000 (d) Retained earnings balance as at 1 July 2015 was $275000. (e) Profit for the period was $500480. (f) Shareholder approval is not required for final dividends declared by directors. (g) During the year, Earth Ltd paid $75000 to its auditor, of which $19000 related to services other than the annual audit and half-yearly review. Required Prepare, for Heaven Ltd, the statement of financial position, statement of changes in equity and notes thereto at 30 June 2016 in accordance with the requirements of AASB 101.

View Less >>

Solution Preview

Calculation of Value of Goodwill
Purchase Consideration   220800
Less:
Share Capital   100000
Retained Earnings   58800
Adjustment for fair value:
Patent   1400
Plant   14000
Inventory   4480
Value of Goodwill    42120
Add: Patent   2000
Net Value of Goodwill   44120

question Get solution

$25

Orginal Price : $32.50

Pay Now

Upload Assignments

Get Your Assignment

Don’t delay more, place your order now. Quick assignment help will be offered to you.

Order Now

CUSTOMER REVIEWS

Excellent

Based on 702 reviews See all reviews here

One of the Best Service

I trust LiveWebTutors for my assignments because of their ability to deliver the perfect assignments time and again. Only a few of my assignments required minor revisions. The rest assured it is the best assignment writing service in the market.

Elizabeth
Sydney

Great Service and on time

I felt so exhausted and burdened with the large number of assignments I had to write and desperately needed someone to help me with all the writing and there was LiveWebTutors company on the internet. They finished my assignments before the due date and also offered me a first-timer discount.

Christina
Perth

One of the Best Assignment Provider

I ordered my Mathematics and Marketing assignments from them last month. I received the content on the set date. Most importantly, the assignments were well-written and plagiarism free. I scored a top grade for the assignment written by them. They are a reliable company.

Oli
Brisbane

Very Helpful Customer Service

I was quite unsure about getting my assignment written online but after coming across LiveWebTutors.com, all my worries have vanished. The quality of the assignments written by their writers is just invincible. Their customer support is very polite and helpful. You should try their service at least once

Kabir
Adelaide

Let Us Help You

shopping cart 0

Amount Payable : $0

World's Leading Assignment Library

Choose Your Topic