Study Corporate Accounting Assignment Help
Instructions:
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Points are given for the quality of your calculation formats even if your final calculations are not correct.
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Required:
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- Make sure your name and student number are on every page of your submission.
ACT 503 Corporate Accounting
Due Date: 11.59 pm Friday 29th September in Study Week 10
Assignment
Question 1: (Marks 15)
ShouldBeMyOwnWork Ltd had the following balances in their books showing Carrying Amount and Tax Base amounts at 30 June 2018 which creates temporary differences:
| Carrying Amount | Tax Base | |||||||||
| Page | 2 | ||||||||||
| Asset or Liability | ($’000) | ($’000) | ||||||||
| Computers at cost | 300 | 300 | ||||||||
| Accumulated depreciation | (60) | (100) | ||||||||
| Computers, net | 240 | 200 | ||||||||
| Accounts receivable | 100 | 100 | ||||||||
| Allowance for doubful debts | (10) | 0 | ||||||||
| Accounts receivable, net | 90 | 100 | ||||||||
| Provision for warranty costs | 30 | 0 | ||||||||
| Provision for employee benefits (LSL) | 20 | 0 | ||||||||
The following information is available for the following year, the year ending 30 June 2019.
| Statement of profit or loss and other comprehensive income for | |||
| ShouldBeMyOwnWork Ltd for the year ending 30 June 2019 | ($’000) | ||
| Revenue | 4,000 | ||
| Cost of goods sold expense | (1,800) | ||
| Depreciation expense | (60) | ||
| Warranty expense | (90) | ||
| Bad and doubtful debts expense | (25) | ||
| Other expenses | (1,375) | ||
| Profit before tax | 650 | ||
| Other comprehensive income | Nil | ||
ShouldBeMyOwnWork Ltd depreciates computers over five years in its accounting records, but over three years for tax purposes. The straight-line method is used. During the year, ShouldBeMyOwnWork Ltd wrote off bad debts amounting to $15,000. Warranty costs of $70,000 were paid during the year. No amounts were paid for long-service leave during the year.
The following information is extracted from the statement of financial position at 30 June 2019:
| ($’000) | ||
| Assets | ||
| Accounts Receivable | 120 | |
| Allowance for doubful debts | (20) | |
| Liabilities | ||
| Provision for warranty costs | 50 | |
| Provision for employee benefits (LSL) | 30 | |
| ACT 503 Corporate Accounting | Assignment |
Due Date: 11.59 pm Friday 29th September in Study Week 10
There was no acquisition of plant and equipment during the year.
The tax rate as at 30 June 2018 and 30 June 2019 was 30 per cent
Required:
- Calculate the amount of each of ShouldBeMyOwnWork Ltd’s temporary differences, if Page | 3 any, at 30 June 2018, and state whether it is deductible or taxable
- What is the balance of the deferred tax liability and deferred tax asset, if any, as at 30 June 2018?
- Calculate ShouldBeMyOwnWork Ltd’s taxable income for the year ending 30 June 2019.
- Prepare journal entries to record current tax and deferred tax for the year ending 30 June 2019.
Question 2: (Marks 10)
In accounting for employee benefits wherein under their contract with ,employers employees can receive various forms of benefits in return for their services. Such benefits will usually result to recognition of expenses by the employer, and if not paid as at the end of the reporting period, becomes liabilities from the perspective of the employer.
If the services of the employees are used to generate items that are expected to provide future economic benefits — for example, employees generate Inventories in the form of WIP (work in progress) — then amounts paid or payable to employees may be considered to be part of the cost of the respective assets.
Required: Aside from the above-mentioned Inventories, illustrate or describe other scenarios you can think of when would payments made to employees can be considered to be an Asset? Provide possible journal entries, if needed. Maximum 200 words.
ACT 503 Corporate Accounting
Due Date: 11.59 pm Friday 29th September in Study Week 10
Assignment
| Question 3: (Marks 10) | |||
| Required | |||
| State whether the following assets may be revalued, support your answer with a brief | |||
explanation
| |||
| Page | 4 | |||
| represents a separate class of assets |
- NT News OnTheGo Ltd has developed a masthead for its newspaper to the point where it is a very valuable asset. Although the masthead is not currently recognised, management believes it could be sold for at least $3 million.
- John Wiley & Sons Australasia Ltd purchased a publishing title two years ago for $1.2 million when another publisher went into liquidation. The book lhas been very successful and management believesthat it could probably sell $1.5 million if ever they put it on the market.
- Booze Your Juice Ltd acquired a franchise for an ice-cream stand at a beach at a cost of $100 000. There is great demand for this type of franchise as evidenced by recent sales of equivalent franchises at other beaches. The current market price of such a franchise is $200 000.
- DJB Ltd has deferred development costs of $520 000 and the estimated recoverable amount of development project is $860 000.
Question 4 (Marks 15)financial accounting services called MyNextProblem Consultancy Ltd. You have been invited to lecture at Darwin Charles Uni and provide advice to students of the requirements of AASB 10 in respect of the control criterion.
You own a Required: For each of the below independent situation, determine whether or not control exists and, if so, by which party. Discuss the reasons for your answers. Where possible, support your answer with excerpts from AASB 10.
You will be marked based on the explanation of your answer and not the Standard’s wordings itself. Maximum 150 words per situation, excluding any words quoted from the standard.
The following are independent situations:
- ACT503 Ltd, a supplier of sailing equipment, was incorporated 10 years ago and is 60 per cent owned by ACT305 Group. ACT503 Ltd has been a very successful business, averaging annual profits of $500 000. However, during the past two years the company has run into financial difficulties and has defaulted on its loan with its bank. Consequently, the bank has used the powers in the load agreement to monitor the company’s activities closely in order to obtain repayment of its debt. The company must now obtain the bank’s authorisation for any expenditure over $5 000 and no changes in operations of the company are permitted without the bank’s approval.
ACT 503 contract with ,employers
Due Date: 11.59 pm Friday 29th September in Study Week 10
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