Glenelg Bay Ltd has a Cash-Generating Unit (CGU) comprised of assets as follows: Asset Carrying Amount Inventory 15,000 Goodwill 30,000 Plant 80,000 Motor Vehicles 40,000 On 30 June 2020, Glenelg Bay performed an impairment test for this CGU and determined that the recoverable amount is $120,000. Required Calculate the impairment loss as at 30 June 2020. Prepare a table as provided below to allocate the above impairment loss: ASSETS Carrying amount Proportion Loss allocated Adjusted carrying amount Totals (c) Prepare a general journal (as per template below) to record the above impairment loss for the year ended 30 June 2020. Include a narration. General Journal Date Accounts Debit Credit
On 1 August 2020, Candy Ltd issued a disclosure document inviting applications for 10,000 of $80 debentures at par, payable in full on application. The debentures carry an 8% annual interest charge and will be redeemed at nominal value in 5 years. The interest payment is made semi-annually on 31 December and 30 June each year. By 30 September 2020, Candy Ltd received application money for 11,000 debentures. On 1 October 2020, Courtney Ltd issued 10,000 debentures and refunded monies to 1,000 unsuccessful applicants. Required: Prepare a general journal template as per example below based on the information above, for Candy Ltd for the year ended 30 June 2021. Include a narration. General Journal Date Accounts Debit Credit …
A manufacturing company HES Inc. has two product lines. Traditional product has unit price of $340 and Classic has a unit price of $480. Firm’s manufacturing overhead costs are applied as $420 per direct labor hour. HES Inc Budgeted statement of gross margin 2020 Products Traditional Classic Total Sales in units 10000 8000 18000 Beginning finished goods $480,000.00 $500,000.00 $980,000.00 Direct material $2,000,000.00 $3,400,000.00 $5,400,000.00 Direct labor $370,370.00 $185,186.00 $555,556.00 Ending finished goods $480,000.00 …
Jan-Stone Limited is looking into the following two (2) investment projects: Project A B Cost of Investment $450,000 $560,000 Estimated net cash flows Year $ $ 1 180,000 220,000 2 160,000 200,000 3 130,000 170,000 4 110,000 150,000 5 90,000 120,000 6 60,000 80,000 730,000 940,000 The company’s required rate of return for both projects is 15%. Required: a. Calculate the net present value (NPV) for both projects. b. Evaluate and advise the management which one of the projects to opt for, if any.
The following summary of information extracted from Jan-Stones Limited, are for a typical month: Total Sales Revenue: Total Variable cost: Fixed costs per month: Units sold per month: $82,000 $36,000 $16,000 5,000 (i) Calculate the contribution per unit. (ii) Compute the monthly break-even point in units. (iii) If a monthly net profit of $40,000 is to be achieved, how many units would have to be sold?
Jan-Stones Limited has compiled the 4-month data below: Units Total Costs May 1,200 $39,400 June 1,600 $43,200 July 1,400 $41,800 August 1,100 $37,000 Applying the high-low method, answer the following questions: (i) Calculate the variable cost per unit. (ii) Calculate the fixed cost portion of the total costs. (iii) If the company uses 1,800 units in September, how much will the total costs be?
What would be the expected price of a stock when dividends are expected to grow at a 25% rate for three years, then grow at a constant rate of 5%, if the stock’s required return is 13% and next year’s dividend will be $4.00?
What rate of return is expected from a stock that sells for $30 per share, pays $1.50 annually in dividends, and is expected to sell for $33 per share in one year?
The ordinary shares of FED Limited are selling for $26.75 on the open market. A dividend of $3.68 is expected to be distributed, and the growth rate of this company is estimated to be 5.5%. If Bob Dean, an average investor, is considering purchasing this share at the market price, what is his expected rate of return?