logo

ACC210(ATMC) - Financial Accounting Task 2 - 2017 Major Assignment Semester 2 - 2017 Student Name: Campus

10 Pages2128 Words148 Views
   

Added on  2020-04-07

About This Document

As per paragraph number nine of the accounting standard, fair value of the asset is defined as the price which will be received when the asset is sole or as the price which will be paid to square off the liability at the particular date (AASB, 2011). As per paragraph number nine of the accounting standard, fair value of the asset is defined as the price which will be received when the asset is sole or as the price which will be paid to square off the liability at the particular date (

ACC210(ATMC) - Financial Accounting Task 2 - 2017 Major Assignment Semester 2 - 2017 Student Name: Campus

   Added on 2020-04-07

ShareRelated Documents
ACC210(ATMC) - Financial AccountingTask 2 – Major AssignmentSemester 2 - 2017Student Name:Student ID #:Campus:
ACC210(ATMC) - Financial Accounting Task 2 - 2017 Major Assignment Semester 2 - 2017 Student Name: Campus_1
Table of ContentsQuestion 1. Ex 3.1..................................................................................................................................3Accounting Justification:................................................................................................................3Relevant Issues:.............................................................................................................................31. Determine subject of measurement..........................................................................................32. Determine valuation premise/method......................................................................................33. Determine market.....................................................................................................................34. Determine Valuation technique.................................................................................................3Question 2. Ex 5.18................................................................................................................................4Accounting Justification:................................................................................................................4Relevant Issues:.............................................................................................................................41. Calculations & General Journal Entries 1/7/16 to 30/6/17:.......................................................42. Calculations & General Journal Entries 1/8/18:.........................................................................43. Calculations & General Journal Entries 30/6/18:.......................................................................4Question 3. Ex 6.11................................................................................................................................5Accounting Justification:................................................................................................................5Relevant Issues:.............................................................................................................................51. Explain accounting issues...........................................................................................................52. Differences Internally Generated vs Acquired...........................................................................53. Reasons for Reluctance..............................................................................................................5Question 4. Ex 9.19................................................................................................................................6Accounting Justification:................................................................................................................6Relevant Issues:.............................................................................................................................61. Deficit of Fund...........................................................................................................................62. Net Defined Benefit Liability......................................................................................................63. Net Interest................................................................................................................................64. Reconciliation............................................................................................................................65. Summary Journal.......................................................................................................................6Page 2 of 10
ACC210(ATMC) - Financial Accounting Task 2 - 2017 Major Assignment Semester 2 - 2017 Student Name: Campus_2
Question 1. Ex 3.1Accounting Justification:The conceptual framework of measurement of the fair value is dealt with the Australianaccounting standard number 13 on the fair value measurement. As per paragraph numbernine of the accounting standard, fair value of the asset is defined as the price which will bereceived when the asset is sole or as the price which will be paid to square off the liability atthe particular date (AASB, 2011). Relevant Issues:1. Determine subject of measurementIn the given case study, the subject of measurement is consists of two assets namely landand factory. These are to be considered as jointly and also severally. It means these are tobe considered as the separate assets and also to be considered as the single asset as a groupof land and factory while measuring the fair value of the asset. 2. Determine valuation premise/methodPara number 31 of the accounting standard 13 describes the valuation premise of the nonfinancial asset. It defines that the highest and best use of the asset determines the valuationpremise of the asset. In case the highest and best use of the asset is achieved when it isused in connection or together with other asset, the fair value will be the price which will bereceived to sell the asset assuming that the aforesaid asset will be used by the other marketparticipant in different manner. The highest and best use of the asset may give the highervalue to the other market participants. Therefore, the valuation premise will measure thefair value at the price equals to the recent sale price of the land less the amount incurred todemolish the factory. Thus, the fair value will be $1000000 – $100000 = $900000 (Draft andStandard, 2005).3. Determine marketThe market in the current scenario is the active market. It is because the active marketoccurs at the situation where the transactions are being taken place on the frequent basis.In the given case study, the prices of the residential house have been increased over the fewyears and simultaneously the price of the land has been increased from $200000 to$1000000. It exhibits that with the increased requirement of the residential buildings; thecost of land will grow higher and thus has been regarded as the active market as also boththe market participants are dealing effectively and actively (Marton, 2009). 4. Determine Valuation techniqueIn the given case study, the cost approach is applicable. It is because as per the costapproach, the fair value will be equal to the amount required to replace the existingcapacity of the asset. To develop the residential apartment, the cost is $900000. Page 3 of 10
ACC210(ATMC) - Financial Accounting Task 2 - 2017 Major Assignment Semester 2 - 2017 Student Name: Campus_3

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
ACC210(ATMC) Financial Accounting
|11
|2312
|30

ACC210 - Financial Accounting
|11
|3187
|254

ACC210(ATMC) Financial Accounting Assignment
|13
|2915
|23

ACC210 ATMC Financial Accounting
|13
|1867
|81

ACC210 Assignment- Financial Accounting
|12
|2331
|82

ACC210 - Financial Accounting Assignment
|15
|2598
|77