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FAC3764 ASSESSMENT 05 ANSWERS/ SOLUTIONS 2023 FIRST SEMESTER R104,00   Add to cart
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FAC3764 ASSESSMENT 05 ANSWERS/ SOLUTIONS 2023 FIRST SEMESTER

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THIS DOCUMENT CONTAINS ANSWERS FOR FAC3764 ASSESSMENT 05 DUE ON THE 28TH JUNE 2023. BUY HIGH QUALITY WORK IN TIME.

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  • May 1, 2023
  • 2
  • 2022/2023
  • Exam (elaborations)
  • Questions & answers

Subjects

  • in profit or loss
  • the equipment and the associated liability
  • paid r359 000 25000 x r1436 on 1 august 20x21 and shown as a current liability
  • cr trade payables sofp recognition of acquisition o

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By: EducationSA • 1 year ago

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FAC3764 ASSIGNMENT 05 ANSWERS


DATE : 28 JUNE 2023




The accountant recorded the first journal entry correctly. However, he forgot to
recognise the exchange difference loss that was created by exchange rates.


The equipment and the associated liability would be recorded in the financial
statements using the rate of exchange in force at the transaction date – R14.21 to
$1. Therefore, the initial carrying amount of both items is R794 339 ($55900 x
R14.21).


The liability is a monetary item so it would be retranslated at the year end of 30 June
20x22 using the closing rate of R14.55 to $1 at R449 595 ($30 900 x R14.55),
having paid R359 000 ($25000 X R14.36) on 1 August 20x21 and shown as a
current liability.


The exchange difference of R9 621 (R3 750 + R5 871), is recognised in profit or loss
– in this case a loss.


The machine is a non-monetary asset measured under the cost model and so is not
retranslated as the exchange rate changes.


The equipment is depreciated from 1 October 20x21 (the date it is brought into use)
and so the depreciation for the year ended 30 June 20x22 is R99 293 (R794 339/5 x
9/12).


The equipment will be shown as a non-current asset at a closing carrying value of
R695 046 (R794 339 – R99 293).


Journal Account names Debit Credit

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