Financial Accounting Questions and Answers (Solved)
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Added on 2020-01-07
Financial Accounting Questions and Answers (Solved)
Added on 2020-01-07
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FINANCIAL ACCOUNTING
TABLE OF CONTENTSFINANCIAL ACCOUNTING.........................................................................................................1Q.1.INTRODUCTION....................................................................................................................3Accounting policies that relates to property, plant and equipment of FCT Group .....................3Disclosure Requirements of AASB116 and AASB 136..............................................................3CONCLUSION................................................................................................................................4Categories of intangible assets of FLT group..............................................................................4CONCLUSION................................................................................................................................5Q.3. INTRODUCTION...................................................................................................................5Accounting treatment of provisions and policies in respect to long service leaves.....................5Accounting treatment of unrecognised dividend ........................................................................6CONCLUSION................................................................................................................................6Q.4. INTRODUCTION...................................................................................................................6Contingent assets and liabilities and their disclosure in financial statements.............................6Q.5 INTRODUCTION....................................................................................................................7Analysis of the financial ratios....................................................................................................7CONCLUSION................................................................................................................................8REFERENCES................................................................................................................................9
Q.1.INTRODUCTIONFinancial Accounting can be defined as a branch of accounting which deals with thefinancial transactions of the company as well as records, summarizes and presents the financialstatements. Flight centre travel group is the world's top-most and profitable travel retailerpersonally delivering amazing experiences to people, partners, and satisfying their customers toa great extent. This report deals with the financial policies that the company is adopting andvarious accounting standards. Accounting policies that relates to property, plant and equipment of FCT Group As per the Annual report of FCT Group, company is following the guidelines providedby the Australian Accounting Standard Board. Financial statements are prepared as per theAustralian Accounting standards which show true and fair view. These accounting standardsneeds to be followed by the company in order to set the disclosure of financial transactions.Flight centre travel group is charging depreciation on assets as per the policies given by theAccounting standards of Australia (Acharya, V.V.,and et.al., 2013)Company is chargingdepreciation by following Straight line method so as to reduce the carrying amount of an assetover its useful life. Property, plants and equipment are disclosed at historical cost lessdepreciation. The useful life of property, plants and equipment are analyzed and checked at theend of each financial year (Al-Najjar, B. and Hussainey, K., 2011)According to the financial statement of FLT, it can be seen that book amount of buildingat the end of financial year 2016 is declined in comparison to 2015. This is due to the gainrealized in the year 2016 on sale of New Zealand head office building. There was no disposal ofproperty in 2015 which results in higher book value. But if analyzing the accounting policiesfollowed by FLT group, there is an increase in net book amount of plant and equipment in 2016as compared to 2015 by $31111 which is due to the impairment of the plant and equipment inUSA segment. Impairment loss is identified and assessed by the firm when the asset's carryingcost exceeds its recoverable amount. FLT recognizes its impairment loss in profit and lossstatement. Disclosure Requirements of AASB116 and AASB 136FLT group has prepared its financial report as per the Australian Accounting Standardswhich helps the company to present true and fair view to their customers, competitors etc. In the
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