This document presents a comprehensive solution to ACC510 Financial Reporting Task 2, addressing key concepts in financial accounting. The assignment includes detailed analyses of case studies and exercises, providing accounting justifications and relevant issues for each question. Question 1 focuses on fair value measurement, discussing the concept of 'highest and best use' in the context of an aged care home and its impact on asset valuation. Question 2 examines impairment testing, including calculations and journal entries for two cash-generating units (CGUs), considering changes in depreciation. Question 3 delves into the accounting treatment of research and development costs, differentiating between the research and development phases and their implications for financial reporting. Finally, Question 4 addresses employee benefits, specifically defined benefit plans, including the computation of fund deficits, net defined benefit liability, and reconciliation, accompanied by summary journal entries. The solution references relevant accounting standards such as AASB 13 and AASB 136, as well as the conceptual framework of accounting.