HI5020 Corporate Accounting - Question and Solution
Added on 2020-05-28
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Running head: CORPORATE ACCOUNTINGCorporate AccountingUniversity NameStudent NameAuthors’ Note
2CORPORATE ACCOUNTINGTable of ContentsSolution to Question i.................................................................................................................2Solution to Question ii...............................................................................................................3Solution to Question iii..............................................................................................................5Solution to Question IV.............................................................................................................6Solution to Question v................................................................................................................7Solution to Question VI.............................................................................................................8Solution to Question vii.............................................................................................................9References:...............................................................................................................................11
3CORPORATE ACCOUNTINGSolution to Question iEssentially, there are three different items presented in the balance sheet statement of thecorporations and one of the important financial items is necessarily equity. There is not anexception in case of the selected company BSA limited company. As per the balance sheet ofthe company declared during the year 2016, there are necessarily three different items underthe segment equity and these include issued capital, retained earnings as well as reserves. Inactual fact, issued capital can be referred to as the business equity (Bhasin, 2015). Essentially,business corporations mainly draw a specific proportion of the capital necessary for thebusiness concern. However, the enumeration of the issued capital is carried out bymultiplying total number of shares of chiefly stock outstanding by the par values of mainlyshares. As per the annual declaration of the company BSA limited, issued capital can beobserved to be $97592000 in 2016 as compared to the figure of 2015 that is $97592000.Essentially, the key items under issued capital are necessarily issues of particularly ordinaryshares, costs associated to share issue as well as income tax associated to the share issue. Thefollowing financial item under the section of equity includes reserves. In essence, under thethemes of financial accounting, reserve can be regarded as an element of the equity of thecompany BSA limited company. As such, this can be referred to as the additional amountapart from basic capital share. As per the annual declaration of the corporation presented inthe year 2016, there subsists an $1410000 in reserves in the year 2016 when compared to thefigure recorded in the year ago period, that is $1410000. In the company BSA limitedcompany, there exist three different elements of equity reserves that include reserve forequity settled advantage, reserve for foreign currency translation together with research forhedging. The subsequent item mentioned under the section equity of the firm BSA limited isnecessarily retained earnings. This stands for the total profit as well as losses of the
4CORPORATE ACCOUNTINGcorporation particularly calculated from the time of formation lessened by any dividenddisbursement to shareholders (Ramanna, 2014). Solution to Question ii Diverse types of expenses are incurred by business concerns that include selling expendituresand administrative expenditures among many others. Essentially, one of such kind of expendsalso include tax expenditure. Additionally, tax expenditure can be regarded as a majoraccountability of the firm due to the federal, state as well as municipal governments of thenation (Gitman et al., 2015). The enumeration of the tax expenditure is carried out bymultiplying the apt tax of the company by the earnings before taxes after factoring certainkey elements such as non-deductible items, tax assets/resources as well as liabilities (MatsAndersson et al., 2016). As such, there exists no exception in case of the corporation BSALimited as the corporation also has tax expends. As per the annual declaration of thecorporation BSA Limited, the company has registered loss of $(3014000) from mainlycontinuing operations specifically from income tax. In accordance with the directives of theAustralian taxation law, the rate of corporate tax for particularly Australian firm is 30%.Founded on the rate of tax of 30%, the total tax expends of the firm BSA limited is $795000in 2016 and $1564000. Essentially, this can be considered to be primary tax expends of thecorporation for the financial year 2016. Nevertheless, it can be hereby witnessed that therehas been decrease in the overall tax expenditure of the firm owing to the decrease in overallearnings of the business corporation in the financial year 2016 as compared to the year 2015.
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