28 May ASSIGNMENT FOR ACCOUNTING AND FINANCE MASTER GROUPSubject: Financ
ASSIGNMENT FOR ACCOUNTING AND FINANCE MASTER GROUPSubject: Financial accounting and reporting Section-A (Total-75 mark)Question 1. (15 mark) “Coldfield” LLC acquired an equipment at the cost of $ 300,000 on 1 January 2018. The equipment has a useful life of six year and no residual value. “Coldfield” LLC opted for the revaluation model to value its equipment. An independent value was of the opinion that the fair value of the equipment at the end of year 2018 is $ 252,000.Required:Prepare the necessary journal entries to record the aboveAscertain the carrying value of the equipment after considering the journal entry in (a)Question 2. (15 mark)The following information applied to the inventory of “Coldfield” LLC in September 2018.DatesPurchases/SalesUnitsPrice per unitSept 1Purchases2000$ 106Purchases1450$1212Sales2500$2319Sales500$3020Sales250$3521Purchases1000$1523Sales750$1425Purchases2600$1326Purchases400$1728Sales2450$28 Required:Find the cost of goods sold and value for ending inventory by the perpetual system when the inventory cost is applied usingThe FIFO, LIFO and Weighted average method.Prepare the necessary journal entries to record the above only one method Question 3. (15 mark)On 1 January 2018 because of changes in the company’s core business, a franchise for yogurt ice cream is sold to a competitor for $ 35000. The franchise was bought three years ago at a purchase price of $75000 and, at that time, was expected to be used for five years with no value at the end of time. Cost model was used to account for the franchise.Required:Calculate carrying amount and gain (lost) on disposalPrepare journal entries to recognize the derections Question 4. (15 mark)On 1 january 2017, “Coldfield” LLC purchased a 20 – storey building for investment purposes. The cost of building was $ 100 000 and is expected to have a useful life of 30 years with no salvage value. The accounting year for “Coldfield” LLC ends on 31 December each year. “Coldfield” LLC uses the fair value model to measured is investment property. As at 31 December 2017, the market value of the building was $110 000, but as at 31 December 2018, it dropped to $90 000. “Coldfield” LLC uses a straight – line method to depreciation its non-current assets.Required: Explain how “Coldfield” LLC records the above transactions in its bookQuestion 5. (15 mark)On 1 January 2018, “Coldfield” LLC purchased 700 sheep at a cost of $ 80 000. The company’s financial year-end is 31 December. It is estimated that the fair value of sheep in the market on 31 December 2018 is $100 000. The “Coldfield” LLC estimates that commission to dealers is about $3000 if they decide to sell the sheep.Required:Explain how the above transactions are presented in the financial statements of “Coldfield” LLC as at 31 december 2018. Section – B (Total 25- mark)Prepare Financial Statements for “Coldfield” LLC the above information of A section as at 31 December.Statement of financial positionStatement of Gain or Loss
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