Tangible Non-Current Assets

Q1. Use the knowledge fond subordinateneath. What earn be the aggregate capitalized absorb delay regard to new matter (Answer in $000)? (FIB)Land $6,000,000Inspection Officer $200,000Architecture Design $100,000Labour Wages $1,200,000Material Absorb $2,500,000Administration Absorb $400,000Property Tax $300,000Site Overheads $150,00037147528384500$ (2 marks) Q2. Siva Co took some measures from the bank at the set-on-foot of the year 2010 which are as follows: 6% measure repayable in 2011 of $8m & a 9% measure repayable in 2015 of $18m. A interpretation of a qualifying asset began on 5th April 2010 delay the delaydrawal of $3m of funds. On 12th August 2010, another $4m was delaydrawn for the qualifying asset. What earn be the capitalized borrowing absorb at the end of the year 2010? (MCQ) $181,800$216,467$316,467$533,851(2 marks) Q3. Relay Co acquired $60,000 to finance the interpretation of a abundance. Interpretation earn open in two years' interval. The measure was charmed on 1st January 2001 but the interpretation began on 1st March 2001. $13,000 of the measure was unused until 1st July 2001 and instead of defence it inactive Relay Co invested the sum delay 3% come-back. The acquisition payable for the fraternity is at 10% per annum. Reckon the absorb to be capitalized for the year ended on December 2001? (MCQ)$4,800$4,870$5,130$6,000(2 marks) Q4. To produce-an-effect a topical migratory the synod has applied a incapability that in perfect two years the wheels of the migratory has to be replaced. This retrieval earn absorb $1.9 pet. How should the retrieval absorb be treated? (MCQ)The absorb should be charmed into acquisition ; mislaying sayment when it is incurred The absorb should be accrued neutralize the two years ; saymented for the defence absorbThe absorb should be transfered in measure ; saymented for subordinate the defence absorbCapitalize the absorb ; belowneathcompute it neutralize the two years until contiguous interval(2 marks) Q5. Trivial Co has purchased an asset excellence $375,000 on 1st January 2000 ; its acquisitionable esay is ageical at 20 years. A revaluation was charmed establish on 31st March 2002 where the possessions excellence increased to $390,000. What earn be the aggregate diminution teeming on the asset for the year ended 31st December 2002? (MCQ)$4,687$16,479$21,167$23,872(2 marks) Q6. Accenture Co has rented its station view to 3rd face on 30th June 2020. The fraternity uses the open valuation design for siege peculiarity. Buildings ancient absorb computed at $500,000 on 1st January 2012 ; aggregate esay were 25 years. A open compute was obtained on the rented day which computed the view at $400,600. At the year-end of 2020, the open compute of the view was $850,000. What earn be the revaluation bring-about/mislaying on 31st December 2020? (MCQ)$50,000 (Loss)$70,600 (Gain)$170,00 (Gain)$203,100 (Loss)(2 marks) Q7. Hexcentric begined a insert on 1st July 2016. The insert was expected to run for indecent years until 30th June 2020. After the expected esay the insert would be decommissioned and the establish earn be vertical seal to its ancient say. The absorb of decommissioning was expected to be $6 pet in indecent years. This honor was conducive on 1st July 2016. To reckon the offer compute the fraternity earn use an 8% remittance rebuke where the remittance ingredient for year indecent is 0.735. Reckon the aggregate arraign for the absorb to be charmed into year-end 30th June 2017 acquisition ; mislaying sayment? (MCQ)$352,800$1,102,500$1,455,300$2,088,000(2 marks) Q8. The aftercited sayments detail to revaluation. (HA) The perfect dispose of PPE has to be revalued whenever a unique equipment in the regardive dispose subordinategoes revaluation TRUE FALSEIf a revaluation design is used revaluation must be made constantly to fix carrying sum has a symbolical disagreement from the open compute TRUE FALSE(2 marks) Q9. Pang Co has purchased a peculiarity excellence $7 pet on 1st January 2013. The establish computed at $3 pet. The view aggregate esay was 20 years delay no residual compute. On 31st December 2015, the peculiarity was revalued to $9 pet where the view computed at $5.184 pet. The peculiarity was amply sold on 30th December 2017 for $6.5 pet. Reckon the bring-about/mislaying on rankification which earn be saymented for acquisition ; mislaying? (MCQ) $1,924,000 (Loss)$3,816,000 (Loss)$4,608,000 (Gain)$2,824,000 (Gain)(2 marks) Q10. Which of the aftercited sayments are reform in aspect to synod transfers? (MRQ)A synod transfer is customary in the acquisition ; mislaying neutralize an possessions acquisitionable estateA requital of a synod transfer common in preceding years is a foregoing age adjustmentA marketing education from the synod does not appoint subordinate the specification of synod transferThe transfer common for an asset must be embracing from the carrying sum of the asset (2 marks) Q11. A fraternity has begined a new insert delay the aid of a synod transfer of $20,000. The esay of the insert is five years. Other than transfering the grounded equipment in the insert absorb $90,000. All equipment is belowneathvalued at 20% per annum on a straight-line cause. Reckon the compute of synod transfer charmed into Year 1 prevalent obligation using exuberant allowance mode? (MCQ)$4,000$16,000$18,000$20,000(2 marks) Q12. A fraternity issued measure notes for $200,000 on 1st January 2008. On the similar day, the fraternity used the currency to buy an siege peculiarity. At the year-end, the open compute of the peculiarity had vertical to $400,000 delay a cherishing esay of ten years. The fraternity uses the open compute design for all properties. Which of the computes earn be saymented in the year's acquisition ; mislaying sayment? (MCQ)Gain $200,000, Diminution $40,000Gain $0, Diminution $40,000Gain $200,000, Diminution $0Gain $200,000, Diminution $20,000(2 marks) Q13. Zima Co took some measures from the bank at the set-on-foot of the year 2015 which are as follows: 9% measure repayable in 2016 of $11m ; a 13% measure repayable in 2020 of $29m. A interpretation of a qualifying asset began on 5th April 2015 delay the delaydrawal of $8m of funds. On 12th August 2015, another $9m was delaydrawn for the qualifying asset. What earn be the capitalized borrowing absorb at the end of the year 2015? (MCQ) $267,750$446,250$714,000$1,160,250(2 marks) Q14. Olay Co acquired $25,000 to finance the interpretation of a insert. Interpretation earn open in two years' interval. The measure was charmed on 1st January 2013 but the interpretation began on 1st March 2013. $6,000 of the measure was unused until 1st July 2013 and instead of defence it inactive Olay Co invested the sum delay 7% come-back. The acquisition payable for the fraternity is at 15% per annum. Reckon the absorb to be capitalized for the year ended on December 2013? (FIB)3613151270000$ (2 marks) Q15. Plato Co has purchased an asset excellence $258,990 on 1st January 2008 ; its acquisitionable esay is ageical at twenty years. A revaluation was charmed establish on 31st March 2010 where the possessions excellence increased to $310,000. What earn be the aggregate diminution teeming on the asset for the year ended 31st December 2010 undeviating to $000? (FIB)3613151270000$ (2 marks) Q16. Ventura Co has rented one its properties to a 3rd face on 30th June 2010. The fraternity uses the open valuation design as an siege peculiarity. Property's ancient absorb computed at $800,800 on 1st January 2002 ; aggregate esay was 50 years. A open compute was obtained on the rented day which computed the view at $750,500. At the year-end of 2010, the open compute of the view was $1,150,000. What earn be the revaluation bring-about at 31st December 2010? (FIB)3613151270000$ (2 marks) Q17. Boric Co opened a implement on 1st July 2006. The insert was expected to run for indecent years until 30th June 2010. After the expected esay the implement would be decommissioned and the area earn be vertical undeviating to its ancient say. The absorb of decommissioning was expected to be $3.3 pet in indecent years. This honor was conducive on 1st July 2006. To reckon the offer compute the fraternity earn use a 12% remittance rebuke. Reckon the aggregate arraign for the absorb to be charmed into year-end 30th June 2007 acquisition ; mislaying sayment? (MCQ)$251,856$272,844$524,700$776,556(2 marks) Q18. Bing Co has purchased a establish ; view excellence $12 pet on 1st January 2005. The establish computed at $4 pet. The views aggregate esay was ten years delay no residual compute. On 31st December 2007, the establish ; view were revalued to $16 pet where the establish computed at $6.75 pet. The establish ; view was amply sold by 30th December 2009 for $10.5 pet. Reckon the bring-about/mislaying on rankification? (MCQ) $4,472,000 (Loss)$1,600,000 (Loss)$1,028,000 (Gain)$5,600,000 (Gain)(2 marks) Q19. Jazzy Co has opened a new ingredienty delay the aid of a synod transfer of $580,600. The esay of the insert is fifteen years. Other than transfering the grounded equipment in the insert absorb $20,400. All equipment is belowneathvalued at 25% per annum on reducing neutralize cause. Reckon the compute of synod transfer charmed into Year 1 prevalent obligation using exuberant allowance mode? (MCQ)$15,300$20,400$145,150$150,250(2 marks) TANGIBLE NON-CURRENT ASSETS (ANSWERS) Q1. $10,150 Capitalized Absorb = 6,000 + 200 + 100 + 1,200 + 2,500 + 150 = $10,150 Q2. CInterest = (8 × 6%) = 0.48 + (18 × 9%) = 1.62 = 2.1(2.1 ÷ 26) × 100 = 8.08%3,000,000 × 8.08% × 9/12 = 181,8004,000,000 × 8.08% × 5/12 = 134,667Total = 181,800 + 134,667 = $316,467 Q3. B60,000 × 10% × 10/12 = 5,00013,000 × 3% × 4/12 = (130)Total = 5,000 - 130 = $4,870 Q4. DThis is disclosed as neutralizehauling where defence, inspection or any relit is required. It is capitalized in the asset ; belowneathvalued neutralize its acquisitionable esay in this instance the esay of wheels. Q5. CDepreciation plow 31st March = (375,000 ÷ 20) = 18,750 × 3/12 = $4,687Years = 20 – 2.25 = 17.75 cherishingDepreciation plow 31st December = (390,000 ÷ 17.75) = 21,972 × 9/12 = $16,479Total = 4,687 + 16,479 = $21,167 Q6. BDepreciation = (500,000 ÷ 25) × 8.5 = 170,000Cost – Diminution = 500,000 – 170,000 = 330,000Revaluation Bring-about = 400,600 – 330,000 = 70,600 Q7. CDepreciation = 6,000,000 × 0.735 = 4,410,000 ÷ 4 = 1,102,500 Finance Absorb = 4,410,000 × 8% = 352,800Total = 1,102,500 + 352,800 = $1,455,300 Q8.The perfect dispose of PPE has to be revalued whenever a unique equipment in the regardive dispose subordinategoes revaluation TRUE If a revaluation design is used revaluation must be made constantly to fix carrying sum has a symbolical disagreement from the open compute FALSEThe disagreement between carrying sum ; the open compute should be imsymbolical when applying revaluation design. Q9. AWorkings are effected in $000.Depreciation (Building) = (4,000 ÷ 20) × 2 = 400Cost = 7,000 – 400 = 6,600 Revalued to 9,000 delay bring-about of 2,400Depreciation (Building) = (5,184 ÷ 18) × 2 = 576Building compute = 5,184 – 576 = 4,608Property compute = (4,608 Building) + (3,816 Land) = 8,424Loss on rankification = 8,424 – 6,500 = 1,924 Q10.A synod transfer is customary in the acquisition ; mislaying neutralize an possessions acquisitionable esay (Correct)A requital of a synod transfer common in preceding years is a foregoing age adjustment; all adjustments are to be dealt prospectively A marketing education from the synod does not appoint subordinate the specification of synod transfer (Correct)The transfer common for an asset must be embracing from the carrying sum of the asset; a exuberant allowance mode can be used also Q11. AThe exuberant allowance mode:Year 0Equipment Dr. (90+20) $110,000Bank Cr $90,000Government Transfer Cr $20,000Year 1Depreciation for equipment = 110,000 × 20% = $22,000Government Transfer = 20,000 × 20% = $4,000 (Current Liability) Q12. CThe bring-about of $200,000 earn be commemorative as in open compute design no diminution is teeming. Q13.Interest = (11 × 9%) = 0.99 + (29 × 13%) = 3.77 = 4.76(4.76 ÷ 40) × 100 = 11.9%8,000,000 × 11.9% × 9/12 = 714,0009,000,000 × 11.9% × 5/12 = 446,250Total = 714,000 + 446,250 = $1,160,250Q14. $2,98525,000 × 15% × 10/12 = 3,1256,000 × 7% × 4/12 = (140)Total = 3,125 - 140 = $2,985 Q15. $16,300Depreciation plow 31st March = (258,990 ÷ 20) = 12,950 × 3/12 = $3,238Years = 20 – 2.25 = 17.75 cherishingDepreciation plow 31st December = (310,000 ÷ 17.75) = 17,465 × 9/12 = $13,099Total = 3,238 + 13,099 = $16,337Nearest to $000 = $16,300 Q16. $85,836Depreciation = (800,800 ÷ 50) × 8.5 = 136,136Cost – Diminution = 800,800 – 136,136 = 664,664Revaluation Bring-about = 750,500 – 664,664 = $85,836 Q17. DDepreciation = 3,300,000 × 0.636 = 2,098,800 ÷ 4 = 524,700 Finance Absorb = 2,098,800 × 12% = 251,856Total = 524,700 + 251,856 = $776,556 Q18. AWorkings are effected in $000.Depreciation (Building) = (8,000 ÷ 10) × 2 = 1,600Cost = 12,000 – 1,600 = 10,400 Revalued to 16,000 delay bring-about of 5,600Depreciation (Building) = (9,250 ÷ 18) × 2 = 1,028Building compute = 9,250 – 1,028 = 8,222Land ; View compute = (8,222 Building) + (6,750 Land) = 14,972Loss on rankification = 14,972 – 10,500 = 4,472 Q19. CThe exuberant allowance mode:Year 0Equipment Dr. (580,600 + 20,400) $601,000Bank Cr $20,400Government Transfer Cr $580,600Year 1Depreciation for equipment = 601,000 × 25% = $150,250Government Transfer = 580,600 × 25% = $145,150 (Current Liability)