Silver Berhad is in the process of finalising the financial statements for the year ended 31...

(i) The tax rate applicable to the company has been changed from 26% to 25% on 15 January 2019. This new rate is announced to be applied starting for financial year 2019.

(ii) Major fire broke out in one of its factories on 15 February 2019 and destroyed the inventory valuing RM50,000, the sale value of which is now nil.

(iii) A debtor that owes the company RM30,000 was declared bankrupt by the Insolvency Department on 6 January 2019. (iv) The fair value of investment property held by the company at the reporting date was RM1.2 million. However, a major flood on 5 January 2019 has been affecting the value of this investment property. On 28 March 2019, an independent property valuer estimated that the fair value now has decreased to RM900,000.

Required:

(i) For each case, discuss the accounting treatment.

(ii) Determine the amount profit of Silver Berhad for the year ended 31 December 2018.

Solutions

Expert Solution

note:If you have any doubts you can comment me i am here to help you . if you are satisfied with the answer hit the like button.

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

Silver Berhad is in the process of finalising the financial statements for the year ended 31...

Silver Berhad is in the process of finalising the financial statements for the year ended 31 December 2018 and came across the following issues. Its profit after tax before the following adjustments is RM 1.65 million. The authorisation date for the financial statements is 31 March 2019. (i)The tax rate applicable to the company has been changed from 26% to 25% on 15 January 2019. This new rate is announced to be applied starting for financial year 2019. (ii)Major fire...

Lion Pte Ltd is finalising its financial statements for the year ended 31 December 20X1. The...

Lion Pte Ltd is finalising its financial statements for the year ended 31 December 20X1. The date of authorisation of financial statements for issue was 14 March 20X2 and the annual general meeting is scheduled on 23 April 20X2. The following events occurred as follows: (a) Inventory held by Lion Pte Ltd was recorded at its cost of $1,104,000 at 31 December 20X1 in the statement of financial position. The whole inventory was damaged by flood water in December 20X1....

XY Pte Ltd is finalising its financial statements for the year ended 31 December 20X1. The...

XY Pte Ltd is finalising its financial statements for the year ended 31 December 20X1. The date of authorisation of financial statements for issue was 14 March 20X2 and the annual general meeting is scheduled on 23 April 20X2. The following events occurred as follows: (a) Inventory held by XY Pte Ltd was recorded at its cost of $1,104,000 at 31 December 20X1 in the statement of financial position. The whole inventory was damaged by flood water in December 20X1....

Q3. Jamil Berhad prepares financial statements for the year ended 31 December 2018. The financial statements...

Q3. Jamil Berhad prepares financial statements for the year ended 31 December 2018. The financial statements are expected to be authorised for issue on 20 April 2019. The following events have taken place: (i) A health and safety investigation of an incident which occurred in 2018 was concluded in February 2019, resulting in RM2.5 million fine for Jamil Berhad. A provision for RM0.5 million had been recognised in Jamil Berhad’s financial statements for the year ended 31 December 2018. (ii)...

The financial statements of Aimi Enterprise for the year ended 31 December 2018 are as follows:...

The financial statements of Aimi Enterprise for the year ended 31 December 2018 are as follows: Statement of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2018 RM RM Sales (-) Cost of sales: Opening inventory (+) Purchases (-) Closing inventory Gross Profit (+) Revenues: Discount received Commission received (-) Expenses: Salaries and wages Repair and maintenance Net Profit 25,000 200,000 (15,000) 10,000 8,300 41,300 100,000 450,000 (210,000)...

The Statements of Financial Position of Dream Limited for the year ended 31 December 2015 are...

The Statements of Financial Position of Dream Limited for the year ended 31 December 2015 are provided below: Dream Limited Statement of Financial Position as at 31 December: 2015 2014 $’000 $’000 Assets: Land 350 200 PPE 950 510 Accumulated depreciation (380) (240) 570 270 Cash at bank 20 - Inventories 110 200 Accounts receivable 200 180 Total 1,250 850 Liabilities: Accounts payable 160 210 Bank overdraft 0 20 Salary payable 40 20 Tax payable 80 60 Dividends Payable 50...

The draft financial statements of Socket Limited for the year ended 31 December 2017 are as...

The draft financial statements of Socket Limited for the year ended 31 December 2017 are as below: Statement of profit or loss and other comprehensive income for the year ended 31 December 2017 ? ? ? ? $m Revenue ? ? ? ? 168,300 Cost of sales ? ? ? ? -115,850 Gross profits ? ? ? ? 52,450 Administration expense ? ? ? ? -2,750 Distribution expense ? ? ? ? -1,200 Profits before tax ? ? ? ?...

DEKO Berhad is in the process to finalized its financial statements. The following is the list...

DEKO Berhad is in the process to finalized its financial statements. The following is the list of assets and liabilities as at 31 December 2019 Accounts Carrying amounts (RM) Property 5,000,000 Equipment 2,000,000 Leasehold land 3,000,000 Prepaid insurance 60,000 Trade receivables 220,000 Accrued dividend 10,000 Unearned rental income 46,000 Trade payable 35,000 Provision for employee benefits 120,000 Additional information: The balance amount of deductible for tax purposes in the future periods relating to the property is RM4,850,000 and the equipment...

(C) ZAPRYL BHD is in the process to finalise its financial statements for the year ended...

(C) ZAPRYL BHD is in the process to finalise its financial statements for the year ended 31 December 2019. Based on its current records, the profit before tax is RM3,200,000 (2018: RM3,000,000). However, the followings have been discovered: (a) Sales invoices dated 24 December 2018 amounted to RM8,000 and 27 December 2019 amounted to RM10,000 were both fake. (b) An investment property was purchased in January 2015 at a cost of RM2,000,000 with a useful life of 25 years and...

The draft financial statements of Pedro, a limited liability company, for the year ended 31 December...

The draft financial statements of Pedro, a limited liability company, for the year ended 31 December 2019 are currently under review. The following points have been raised: An ex-employee has started an action against Pedro for wrongful dismissal. The company’s legal team have stated that the ex-employee is likely to succeed. The following estimates have been given by the lawyers relating to the case: a) Legal costs (to be incurred whether the claim is successful or not) $10,000 ...

Subjects