2. Coca Cola Amatil capital consisted of 172,000 shares issued at $2.00 and paid to $1.75 per share. On 1 January 2020, the company made a call of $0.25 per share payable by 26 February 2020. At this date, all shareholders had paid the call except the holder of 8,000 shares.

On 15 March, Coca Cola Amatil decided to forfeit the shares on which the call was unpaid. The companys constitution provided for any surplus on resale, after satisfaction of unpaid calls and costs, to be returned to the shareholder whose shares were forfeited.

On 28 March 2020, the 8,000 shares were reissued for $1.90 per share, the shares being credited as paid to $2.00 per share. Costs of reissue amounted to $2,800. How much should we credit call and forfeited shares liabilities by?

A.

14, 000 and 2, 000, respectively

B.

16, 000 and 2, 000, respectively

C.

2, 000 and 16, 000, respectively

D.

2, 000 and 14, 000, respectively

1. According to the Conceptual Framework, existing and potential investors, lenders and other creditors of a reporting entity need information in general purpose financial reports to make assessments about:

I.	expected returns from the entity in the form of dividends, principal and interest payments or market price increases.
II.	the amount, timing and uncertainty of future net cash inflows of the entity.
III.	managements stewardship of the entitys economic resources.
IV.	the corporate social responsibility performance of the entity.

A.

I., II., III. and IV

B.

I. only

C.

I., II. and III. only

D.

I. and II. only.

3.

On 1 January 2015, Russi Ltd constructed an electricity plant. The cost of the building and associated technology was $1,000,000. The license to operate and architects fees amounted to $500,000. The dismantling cost was expected to be $800,000 at the end of plants 10-year useful life. The discount rate was 10%.

The residual value is expected to be $8,435. The plant is expected to generate benefits evenly throughout the years. At the end of 2018, it sells the plant for $1,000,000 cash.

What is the initial cost of the plant?

A.

$1, 808, 434

B.

$1, 308, 434

C.

$2, 300, 000

D.

None of the above