Answer:
a. Capitalized : Equipment
b. Expensed
c. Capitalized : Building
d. Expensed
e. Capitalized : Equipment
f. Capitalized : Building
g. Capitalized : Building
h. Capitalized : Equipment
Explanation:
The Cost of Property, Plant and Equipment item according to IAS 16 includes, the Purchase Cost and any cost directly incurred in putting the assets in location and condition intended for use by management.
The costs exclude amounts collected in tax on behalf of third parties
Also not Capital expenditures increase the earning ability of the asset whilst revenue expenditure is the maintenance of such asset.
Answer:
Yes the company must recognise the effects of this ruling.
Explanation:
As provided the law suit was initiated in the year 20x2, because of the activity happened in April 20x2.
Accordingly, company was already prepared for a liability of $100,000.
Whenever an event that occurs after the balance sheet is a mere confirmation to what was expected on balance sheet date, or is in alignment with things on record on the balance sheet date, it shall be provided in the balance sheet of that year.
In the given case the law suit was pending on the balance sheet date and was recorded as a liability then, now after the declaration by the judge, the additional liability of $20,000 shall be provided in the financial books of year 20x2.
1. Look for her toys in her toy chest. She didn’t even know that her brother hid her toys in the first place, so she’ll look for her toys in her toy chest, assuming she wants to play with them after dinner.
Hope this helps!
Answer: Understatement, $30,900
Explanation:
There will be an UNDERSTATEMENT of McGinnis' net income for the most recent fiscal year of $30,900.
The Understatement arises because as of year end which is June 30th, McGinnis were not paid for their services that cost $40,900 and instead will only be paid on the 8th of the next month so it was not accounted for in the net income.
The reason the net income understatement is $30,900 and not $40,900 is because McGinnis will still have to account for the payment to it's employees. If in a five day week they earn $12,500, that would mean that they earn $2,500 a day (12,500/5). Seeing as June ended on a Thursday, that is a 4 day week which means $2,500*4= $10,000.
That $10,000 will reduce the net income by that amount.
The net effect is a $30,900 UNDERSTATEMENT.
Answer:
It increases by 50 units.
Explanation:
Current break even point = 
Here, fixed cost = $4,500
Contribution per unit = Selling price - Variable Cost = $20 - $10 = $10
Current break even point = 
If variable cost increase by 10% then revised variable cost = $10 + 10% = $11
Contribution per unit = $20 - $11 = $9 per unit
Break even sales in units = 
Difference in original and revised break even = Revised - Original = 500 - 450 units = 50 units,
Thus original break even increases by 50 units, = 50/450 = 11.11% increase.
Final Answer
It increases by 50 units.
