HI6025 – Diamond Ltd acquired an item of polishing equipment

Question 1 Diamond Ltd acquired an item of polishing equipment on 1 July 2015 for $440,000. The equipment is expected to have a useful life of 10 years and the straight-line method of depreciation is to be used. It has salvage value of $40,000. On 1 July 2017, the equipment is deemed to have a fair value of $424,000 and revaluation is undertaken in accordance with the Diamond Ltd policy of measuring property, plant and equipment at fair value. The asset is still usable for next 8 years but the salvage value is determined to be zero. The asset is sold for $356,000 on 1 July 2019. Required: Provide the journal entries necessary at the following dates to account for the…

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MYOB – The business is a book retailer named

Case Study 1 Introduction In this assignment students are required to use the: General Ledger Banking Sales – Accounts Receivable Purchases – Accounts payable Inventory modules of the MYOB computer accounting program to process transactions and to produce a set of accounting reports relating to business operations. Input Business data The business is a book retailer named, “Student Name Pty Ltd” (students are to insert their own name) and is located at Your Address – Sydney NSW 2000.The firm’s sales are both over-the-counter cash and credit to well known customers.   Company Name Address ABN Current Financial Year Last Month of Financial Year Starter Chart “Your name” Books Pty Ltd Your Address Your student Number 2020 June Retail Book store  …

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HA3011 – TXA Ltd acquired a machine from Blue Ltd

Question 1 TXA Ltd acquired a machine from Blue Ltd for the following consideration: Cash $70, 000 Land in the books of TXA Ltd the land is recorded at its cost of $650,000. It has a fair value of $450,000. TXA Ltd also agrees to assume the liability of the Blue Ltd bank loan of $89,000 as part of the machine acquisition. Required: (a) Calculate the acquisition cost of the machine. (b) Provide the journal entries that would appear in TXA Ltd.’s books to account for the acquisition of the Machine.   Question 2 Max Ltd acquires an item of machinery on 1 July 2016 for a total acquisition cost of $61,000. The life of the asset is assessed as being six…

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HI5002 – National First Bank offers you a home loan

Question 1.  National First Bank offers you a home loan for the next 30 years. The interest rate on the loan is 2.5% per annum. Required: If the bank says that you need to pay $500 each week and the interest rate is compounded weekly, what is the amount of your home loan? What is your monthly payment if you wish to pay monthly instalments and the interest rate is compounding monthly?   Question 2. Giant Equipment Ltd. is considering two projects to invest next year. Both projects have the same start-up costs. Project A will produce annual cash flow of $42 000 at the beginning of each year for eight years. Project B will produce cash flow of $48 000…

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On 1 July 2019, Gilberts Ltd acquired all the issued shares

On 1 July 2019, Gilberts Ltd acquired all the issued shares (cum div.) of Potoroo Ltd for $50 000. At this date the equity of Potoroo Ltd consisted of:   Share capital $25 000 Retained earnings 7 500   At this date, Potoroo Ltd had recorded a dividend payable of $7500 which was paid in August 2019. All the identifiable assets and liabilities of Potoroo Ltd were recorded at amounts equal to fair values except for inventory for which the fair value was $1000 greater than carrying amount. Only 10% of the inventory on hand at 1 July 2019 remained unsold by 30 June 2020. The tax rate is 30%. During the 2019–20 period, the following transactions occurred. (a) Gilberts Ltd…

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MANACC LLP – You are an Analyst for the professional service firm

MACACC LLP.   Background You are an Analyst for the professional service firm, MANACC LLP. Your firm specializes in providing a wide variety of internal business solutions for different clients. After 4 months on the job, you walk into the partner’s office to provide him with your two-week notice. Given your excellent performance over the past few months, rival professional service firm, FININV LLP has provided you with an offer you cannot refuse by providing you with a promotion to Consultant and a significant raise. Although sad to see you go, lead partner requested assistance on a few engagements for several clients.   Julia Child Company Julia Child Company is a local small business and it sells baby car seats. Since…

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Assume that are the financial manager of a company

Assume that are the financial manager of a company, which is considering a potential project with a new product that is expected to sell for an average price of $22 per unit and the company expects it can sell 350 000 unit per year at this price for a period of 4 years. Launching this project will require purchase of a $2 000 000 equipment that has residual value in four years of $200 000 and adding $ 600 000 in working capital which is expected to be fully retrieved at the end of the project. Other information is available below:   Depreciation method: straight line Variable cost per unit: $11 Cash fixed costs per year $350 000 Discount rate: 10% Tax Rate: 30%   Do…

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HI5002 – Little Book LTD has total assets of $860,000

Question 1 Little Book LTD has total assets of $860,000. There are 75,000 shares of stock outstanding, total book value of $750,000 with a market value of $12 a share. The firm has a profit margin of 6.5% and a total asset turnover of 1.5. Required: Calculate the company’s EPS? What is the market –to- book ratio?   Question 2 Fifteen years ago, you deposited $12,500 into an investment fund. Five years ago, you added an additional $20,000 to that account. You earned 8%, compounded semi-annually, for the first ten years, and 6.5%, compounded annually, for the last five years.   Required: What is the effective annual interest rate (EAR) you would get for your investment in the first 10 years?…

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ACCT20073 – ‘X’ Ltd acquired on 1 July 2019 all the issued shares

‘X’ Ltd acquired on 1 July 2019 all the issued shares (cum div.) of ‘Y’ Ltd for $33 000. At this date, the equity of ‘Y’ Ltd was as follows. Share capital $20 000 General reserve 2 000 Retained earnings 5 000 All the identifiable assets and liabilities of ‘Y’ Ltd were recorded at amounts equal to their fair values except for the following. Carrying amount Fair value Plant (cost $22 000) $18 000 $18 600 Land   19 000 21 000 Inventories     2 000 2 800 The plant’s expected remaining useful life was 5 years with benefits being expected evenly over that period. The plant was sold on 1 January 2022 for $18 700. The land was sold in February 2021 for $25 000. Of the inventories, 90% was sold by 30 June…

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The following are individual statements of financial position as at 31 March 2020 of Universe plc

The following are individual statements of financial position as at 31 March 2020 of Universe plc and its subsidiary Galaxy plc:     Universe plc                          Galaxy plc   £’000 £’000                    £’000 £’000 Assets  Non-current assets      Property, plant and equipment       968,750                             512,500      Investment in Galaxy       472,500                 – 1,441,250 512,500  Current assets       Inventories       151,200                               84,150       Trade receivables       101,250                               61,875       Current account with Galaxy         45,000                                        –       Cash and cash equivalents         20,790                        15,975    318,240  162,000 Total assets  1,759,490                  674,500…

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HI5017 – Managerial Accounting – The following data refer to Nani’s Fashions

Week 1 The following data refer to Nani’s Fashions for the current year:   Sales Revenues $475,000 Work in process inventory, 31 December     15,000 Work in process inventory, 1 January     20,000 Selling and administrative expenses     75,000 Income tax expense     45,000 Purchase of raw materials     90,000 Raw materials inventory, 31 December     12,500 Raw material inventory. 1 January     20,000 Direct labour   100,000 Electricity: plant     20,000 Depreciation plant and equipment     30,000 Finished goods inventory, 31 December     25,000 Finished goods inventory, 1 January     10,000 Indirect material       5,000 Indirect labour       7,500 Other manufacturing overhead     40,000   Required: Prepare the schedule of cost of goods manufactured for Nani’s fashion. Prepare the schedule…

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HA1020 – Which of the following events listed below results

Question 1 Which of the following events listed below results in an accounting transaction for Clothing Ltd?  State a reason if it is not an accounting transaction.   Clothing Ltd signed a contract to hire a new store manager for a salary of $150,000 per annum. The manager will start work next month. The founder of Clothing Ltd., who is also a major shareholder, purchased additional stock in another company. Clothing Ltd borrowed $230,000 from a local bank. Clothing Ltd purchased a sewing machine, which it paid for by signing a note payable. Clothing Ltd issued 10,000 shares to a private investor, who is also a car business owner, in return for a new delivery truck. Two investors in Clothing Ltd…

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