Do fully according to the marks

QUESTION 3: [25 Marks] The following information is related to the property, plant and equipment as disclosed in the statement of financial position of Paradise Bhd, a property agent, as at 1 January, 2020 value Remaining useful life Carrying (RM000 Freehold land 35,300 Leasehold land 57,475 Buildings 86,710 Plant and machinery 253,250 Motor vehicles 5,745 BAC 2124 Bachelor of Accounting Hons 60 years 25 years 7 years 5 years Februari 2021 CONFIDENTIAL 471 9 years Furniture, fitting and 12,570 equipment During 2020, the following transaction occurred; 0 Acquired 300 buildings which cost RM 500,000 per unit. Two units of these buildings were to be used as the enthy's showroom. The estimated useful life is 25 years. The remaining buildings were acquired to be resold within a year from the acquisition date. The entity took a bank loan to finance the acquisition of these buildings (10 On 31 December, 2020, the value of the freehold land was assessed by a professional valuer, who considered the fair value to be RM28,000,000. It is the policy of the entity to adopt the revaluation model for its freehold land. Acquired a motor vehicle which cost RM250,000 on 2 January, 2020, on credit 30% of the cost was immediately paid. The balance would be paid on 31 December 2020. The interest rate charged is 6%. The motor vehicle is expected to be used for five years and the estimated residual value at the end of its life is RM40.000 IM Acquired an air conditioner on 1 March, 2020, for RM 350,000 which was installed in the building. The installation cost incurred was RM2.500. All cost incurred were paid by cheque after the installation was completed on 2 March 2020. The air conditioner is expected to be used for three years. The account executive is unsure how to treat these expenditures. IM Depreciation is calculated on a straight line basis over their estimated useful lives. Depreciation is provided based on the ownership of the assets during the year Required: Discuss the importance of the above property, plant and equipment to the capital providers of Paradise Bhd. 13 Marks Determine how Paradise Bhd should account for the items acquired during the year 110 Marks! Il Prepare a schedule showing the property, plant and equipment section of the statement of financial position as at 31 December, 2020 and Prepare the extract of the statement of profit or loss for the year ended 31 December, 2020, showing all expenses resulting from the transactions [12 Marks QUESTION 3: [25 Marks] The following information is related to the property, plant and equipment as disclosed in the statement of financial position of Paradise Bhd, a property agent, as at 1 January, 2020 value Remaining useful life Carrying (RM000 Freehold land 35,300 Leasehold land 57,475 Buildings 86,710 Plant and machinery 253,250 Motor vehicles 5,745 BAC 2124 Bachelor of Accounting Hons 60 years 25 years 7 years 5 years Februari 2021 CONFIDENTIAL 471 9 years Furniture, fitting and 12,570 equipment During 2020, the following transaction occurred; 0 Acquired 300 buildings which cost RM 500,000 per unit. Two units of these buildings were to be used as the enthy's showroom. The estimated useful life is 25 years. The remaining buildings were acquired to be resold within a year from the acquisition date. The entity took a bank loan to finance the acquisition of these buildings (10 On 31 December, 2020, the value of the freehold land was assessed by a professional valuer, who considered the fair value to be RM28,000,000. It is the policy of the entity to adopt the revaluation model for its freehold land. Acquired a motor vehicle which cost RM250,000 on 2 January, 2020, on credit 30% of the cost was immediately paid. The balance would be paid on 31 December 2020. The interest rate charged is 6%. The motor vehicle is expected to be used for five years and the estimated residual value at the end of its life is RM40.000 IM Acquired an air conditioner on 1 March, 2020, for RM 350,000 which was installed in the building. The installation cost incurred was RM2.500. All cost incurred were paid by cheque after the installation was completed on 2 March 2020. The air conditioner is expected to be used for three years. The account executive is unsure how to treat these expenditures. IM Depreciation is calculated on a straight line basis over their estimated useful lives. Depreciation is provided based on the ownership of the assets during the year Required: Discuss the importance of the above property, plant and equipment to the capital providers of Paradise Bhd. 13 Marks Determine how Paradise Bhd should account for the items acquired during the year 110 Marks! Il Prepare a schedule showing the property, plant and equipment section of the statement of financial position as at 31 December, 2020 and Prepare the extract of the statement of profit or loss for the year ended 31 December, 2020, showing all expenses resulting from the transactions [12 Marks