32. APHAS LTD opens a new factory in Cape Coast, and receives a government grant of GHS 150,000 in respect of capital equipment costing GHS1,000,000. APHAS depreciates all plant and equipment at 20% p.a. on straight line basis. Required: Show the statement of financial position extracts to record the grant in the first year using the two methods permitted by IAS 20 . 7 33. PROMAGS LIMITED acquires a plant costing GHS 12,000 on which a grant of GHS 1,800 is received from the government. The plant is to be depreciated on a straight line basis over 3 years. Required: Illustrate how this grant will be treated in the income statement and statement of financial position using the 2 methods. 34. Kwansima Ltd. received a grant of GHC 9million in relation to a factory building that it bought in 2015. Kwansima Ltd acquired the building from an industrialist identified by the government. If Kwansima Ltd did not purchase the factory building which was located in the slums of the city, it would have been repossessed by a government agency. Kwansima Ltd purchased the factory building for GIIC 27 million. The useful life of the building is not considered to be more than three years, mainly due to the fact that it was not properly maintained by the previous owner. Required: How should Kwansima Ltd account for this grant under each of the alternative treatments under IAS 20? 29. Otwinoko has just been appointed as the Finance Director of SRC LAd. On 1 January 2016, SRC L.d acquired a manufacturing plant with a list price of GHS 500,000 . The following further costs were incurred: The installation and setting up period took 3 months and a further amount of GHS42,000 was spent on costs directly related to bringing the asset to its working condition. The plant was ready for use of 1 April 2016. 6 Monthly managerial reports indicated that for the first 5 months to August 2016, the production units from this plant resulted in initial operating lesses of GHS30,000 because of the small quantities produced. The months thereafter show much more positive results. The plant has an estimated useful life of 10years and estimated residual value of GHS36,000. Estimated dismantling costs amount to GHS24,000. Required: What is the cost of the asset to be initially recognised in the asset register and what amount should be charged in the income statement relating to the consumption of the economic benefits embodied in the asset for the 2016 financial year? 30. TUCC Ld is installing a new ICT facility (including a data centre) to enable it better manage its student database and information system. The Finance Director has enumerated there as the costs incured so far. Cost of the software and building (per the suppliers invoice and taxes) 31. XYZ Company revalues its buildings and decides to incorporate the evaluation into the financial statements. The following information is relevant: a) Extract from the balance sheet at 31 December 2006 B) Depreciation has been provided at 2% per annum on a straight line. c) The building is revalued at 30 June 2007 at GHC27,600,000. There is no change in the remaining estimated futare life. Required Show the relevant extracts from the financial statements at 31 December 2007 32. APHAS LTD opens a new factory in Cape Coast, and receives a government grant of GHS 150,000 in respect of capital equipment costing GHS1,000,000. APHAS depreciates all plant and equipment at 20% p.a. on straight line basis. Required: Show the statement of financial position extracts to record the grant in the first year using the two methods permitted by IAS 20 . 7 33. PROMAGS LIMITED acquires a plant costing GHS 12,000 on which a grant of GHS 1,800 is received from the government. The plant is to be depreciated on a straight line basis over 3 years. Required: Illustrate how this grant will be treated in the income statement and statement of financial position using the 2 methods. 34. Kwansima Ltd. received a grant of GHC 9million in relation to a factory building that it bought in 2015. Kwansima Ltd acquired the building from an industrialist identified by the government. If Kwansima Ltd did not purchase the factory building which was located in the slums of the city, it would have been repossessed by a government agency. Kwansima Ltd purchased the factory building for GIIC 27 million. The useful life of the building is not considered to be more than three years, mainly due to the fact that it was not properly maintained by the previous owner. Required: How should Kwansima Ltd account for this grant under each of the alternative treatments under IAS 20? 29. Otwinoko has just been appointed as the Finance Director of SRC LAd. On 1 January 2016, SRC L.d acquired a manufacturing plant with a list price of GHS 500,000 . The following further costs were incurred: The installation and setting up period took 3 months and a further amount of GHS42,000 was spent on costs directly related to bringing the asset to its working condition. The plant was ready for use of 1 April 2016. 6 Monthly managerial reports indicated that for the first 5 months to August 2016, the production units from this plant resulted in initial operating lesses of GHS30,000 because of the small quantities produced. The months thereafter show much more positive results. The plant has an estimated useful life of 10years and estimated residual value of GHS36,000. Estimated dismantling costs amount to GHS24,000. Required: What is the cost of the asset to be initially recognised in the asset register and what amount should be charged in the income statement relating to the consumption of the economic benefits embodied in the asset for the 2016 financial year? 30. TUCC Ld is installing a new ICT facility (including a data centre) to enable it better manage its student database and information system. The Finance Director has enumerated there as the costs incured so far. Cost of the software and building (per the suppliers invoice and taxes) 31. XYZ Company revalues its buildings and decides to incorporate the evaluation into the financial statements. The following information is relevant: a) Extract from the balance sheet at 31 December 2006 B) Depreciation has been provided at 2% per annum on a straight line. c) The building is revalued at 30 June 2007 at GHC27,600,000. There is no change in the remaining estimated futare life. Required Show the relevant extracts from the financial statements at 31 December 2007