how would revaluation reserve be treated in this case,is R40000 from revalution reserve included in property plant and equipment note?.

Additional information 1,2 and 3...what is patent and would it be right to include it in property plant and equipment note?

20 MARKS ASSIGNMENT TWO DUE 21 SEPTE company that manufactures toys: Notes 1 2 3 4 4 5 The following balances for 29 February 2020 were taken from the books of Hanger da Machinery and equipment at carrying amount - 29/2/2020 QUESTION 1 Patents at carrying amount - 29/2/2020 Vehicles at carrying amount - 29/2/2020 Land and buildings at valuation Revaluation reserve Share capital - Ordinary shares Retained earnings - 1/3/2019 Profit for the year Accounts receivable Inventories: Raw materials Work in progress (toys) Finished toys Stationery Accounts Payable Bank and cash on hand Investments 12% mortgage over land and buildings (redeemable in 2025) 6 7 R 18 000 136 000 30 000 280 000 40 000 250 000 44 000 165 000 91 000 24 000 26 000 12 000 1 000 135 000 7 000 79 000 70 000 8 9 10 Additional information: 1. The patents were obtained on 1 March 2013 at R45 000, R4 500 is written off against profit annually. 2. Machinery and equipment were obtained on 1 June 2018. Depreciation is provided for at, 20% per annum on the reducing balance method. 3.Depreciation on vehicles is provided for at 20% per annum on the straight line method. The vehicles were obtained on 1 September 2017 4.Hanger Ltd policy is to revalue land and buildings every three years at market value with reference to observable prices in an active market, by an independent sworn appraiser. The following information was obtained from the asset register: Cost of Erf 11, Johannesburg 2013 240 000 Revalued on 1 February 2017 Revalued on 1 February 2020 40 000 70 000 350 000 Slacus duthaya Miten sadece Hunger Lid was founded on 1 March 2013 with an authorized share capital of 200 000 ordinary shares. Only 100 000 of the ordinary shares were issue at R250 each. & Ordinary dividends of 30 cents per share were declared on 29 February 2020 should still De provided for all the shareholders. 7. Included in Accounts Receivable is Provisional tax paid of R40 000. 8. The following items are included in Accounts payable: Provision for credit losses Accrued expenses Income tax (Correctly calculated) 52 000 3 000 1 000 9.Hanger Ltd has two bank accounts at XYZ Bank and UVW Bank respectively. On 29 February 2020, the XYZ Bank account had an overdrawn balance of R2 500 10.Investment consists of the following: A Limited Z(Pty) Limited Cost price R10 000 R69 000 Stock value per share on 29/2 R4,20 Directors valuation R21 000 R59 000 Number of shares 5 000 10 000 Dividends paid during the year 50c/share 0 Dividends declared end of year 0 40c/share All the above shares are Ordinary shares. Dividends declared has not yet been recorded. YOU ARE REQUIRED to Prepare the Statement of financial position and the Statement of changes in equity of Hanger Limited at 29 February 2020 in accordance with the requirements of the Companies Act 71 of 2008 and International Financial Reporting Standards. Show the all the notes to the financial statements of Hanger Limited at 29 February 2020. Comparative figures may be ignored. 15 MARKS QUESTION 2 statement for the financial year ended 29 February 2020 Coronus Limited is a company specializing in the deep cleaning of offices and buildings. The following information still needs to be accounted for before preparing the correction incorrectly debited to vehicles, as a separate new vehicle. This fuel had all been used during During 2020, it was discovered that fuel purchased on 1 June 2018 for R120 000 had been the 2019 financial year. The taxable profit and tax base were correctly calculated in all your company depreciates vehicles on the straight-line basis at 20% per annum to ni residual affected. The cost of vehicles, bought on 1 March 2016, amounted to R800 000. The values (apportioned for periods less than a year). The accountant has already processed the The following draft extracts of the Statement of comprehensive income and Statement of financial position have been presented to you (the additional information above has not year . depreciation on vehicles for 2020, before correcting the error mentioned Additional information: All amounts are considered to be material The income tax rate is 30%. been taken into account in the preparing these statements): CORONUS LIMITED DRAFT EXTRACTS FROM STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 29 FEBRUARY 2020 2020 2019 R R Profit before tax 900 000 800 00 (200 000) (150 000) 650 000 700 000 Income tax expense Profit for the year Other comprehensive income for the year Total comprehensive income for the year 700 000 650 000 CORONUS LIMITED DRAFT EXTRACT FROM STATEMENT OF FINANCIAL POSITION AT 29 FEBRUARY 2020 2 2020 2019 2018 R R R Vehicles carrying amount 238 000 422 000 480 000 YOU ARE REQUIRED to 1. Show journal entries that would need to be processed to effect the correction of the error. (6 Marks) 2. Disclose how the correction of the error affects the entity's annual financial statements, including notes, for the year ended 29 February 2020 in conformity with International Financial Reporting Standards. (9 Marks) Show your calculations. 15 MARS FEBRUAR QUESTION 3 Property statement for the financial year ended 29 February 2020. Coronus Limited is a company specializing in the deep cleaning of offices and buildings. The following information still needs to be accounted for before preparing the corred After the completion of the concept financial statements for the year ended 29 February 2020 As from 1 March 2019, the total expected useful life of the plant changed from The plant was purchased on 1 March 2016 at a cost of R660 000. Depreciation on plants provided on the straight line method. The accountant has already processed the depreciation The following draft extracts of the Statement of comprehensive income and Statement of to to . in estimate: YOU 1 years to 5 years. The estimated residual value of the plant changed from RO to R30 000 There will be no change in the depreciation method. on plant for 2020, before taking into consideration the changes mentioned above Additional information: All amounts are considered to be material The income tax rate is 30%. financial position have been presented to you the additional information above has not your been account ) CORONUS LIMITED DRAFT EXTRACTS FROM STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 29 FEBRUARY 2020 2020 2019 R R 900 000 800 00 Profit before tax Income tax expense (200 000) 700 000 (150 000) 650 000 Profit for the year Other comprehensive income for the year Total comprehensive income for the year 700 000 650 000 CORONUS LIMITED 90 DRAFT EXTRACT FROM STATEMENT OF FINANCIAL POSITION AT 29 bus 2.30000 s FEBRUARY 2020 The 2020 2019 2018 cial R R R 245 000 465 000 20, 645 000 property, plant and equipment Plant carrying amount Vehicles carrying amount 220 000 330 000 440 000 238 000 422 000 480 000 YOU ARE REQUIRED to 1. Calculate the effect of the change in estimate using the re-allocation method, showing clearly the effect on the current year depreciation and the future years depreciation (5 Marks) 2. Show journal entries that would need to be processed to effect: the change in accounting estimate. (2 Marks) 3. Disclose how the entity's annual financial statements, including notes, are affected for the year ended 29 February 2020 in conformity with International Financial Reporting Standards: the change in estimate. (8 Marks) Show your calculations. The following balances for 29 February 2020 were taken from the books of Harry QUESTION 1 company that manufactures toys: Notes 1 2 3 4 5 6 7 Patents at carrying amount - 29/2/2020 Machinery and equipment at carrying amount - 29/2/2020 Vehicles at carrying amount - 29/2/2020 Land and buildings at valuation Revaluation reserve Share capital - Ordinary shares Retained earnings - 1/3/2019 Profit for the year Accounts receivable Inventories: Raw materials Work in progress (toys) Finished toys Stationery Accounts Payable Bank and cash on hand Investments 12% mortgage over land and buildings (redeemable in 2025) Additional information: R 18 000 136 000 30 000 280 000 40 000 250 000 44 000 165 000 91 000 24 000 26 000 12 000 1 000 135 000 7 000 79 000 70 000 8 9 10 1. The patents were obtained on 1 March 2013 at R45 000, R4 500 is written off against profit annually. 2. Machinery and equipment were obtained on 1 June 2018. Depreciation is provided for at, 20% per annum on the reducing balance method. 3.Depreciation on vehicles is provided for at 20% per annum on the straight line method. The vehicles were obtained on 1 September 2017. 4.Hanger Ltd policy is to revalue land and buildings every three years at market value with reference to observable prices in an active market, by an independent sworn appraiser. The following information was obtained from the asset register: Cost of Erf 11, Johannesburg 2013 240 000 Revalued on 1 February 2017 40 000 Revalued on 1 February 2020 70 000 350 000 20 MARKS ASSIGNMENT TWO DUE 21 SEPTE company that manufactures toys: Notes 1 2 3 4 4 5 The following balances for 29 February 2020 were taken from the books of Hanger da Machinery and equipment at carrying amount - 29/2/2020 QUESTION 1 Patents at carrying amount - 29/2/2020 Vehicles at carrying amount - 29/2/2020 Land and buildings at valuation Revaluation reserve Share capital - Ordinary shares Retained earnings - 1/3/2019 Profit for the year Accounts receivable Inventories: Raw materials Work in progress (toys) Finished toys Stationery Accounts Payable Bank and cash on hand Investments 12% mortgage over land and buildings (redeemable in 2025) 6 7 R 18 000 136 000 30 000 280 000 40 000 250 000 44 000 165 000 91 000 24 000 26 000 12 000 1 000 135 000 7 000 79 000 70 000 8 9 10 Additional information: 1. The patents were obtained on 1 March 2013 at R45 000, R4 500 is written off against profit annually. 2. Machinery and equipment were obtained on 1 June 2018. Depreciation is provided for at, 20% per annum on the reducing balance method. 3.Depreciation on vehicles is provided for at 20% per annum on the straight line method. The vehicles were obtained on 1 September 2017 4.Hanger Ltd policy is to revalue land and buildings every three years at market value with reference to observable prices in an active market, by an independent sworn appraiser. The following information was obtained from the asset register: Cost of Erf 11, Johannesburg 2013 240 000 Revalued on 1 February 2017 Revalued on 1 February 2020 40 000 70 000 350 000 Slacus duthaya Miten sadece Hunger Lid was founded on 1 March 2013 with an authorized share capital of 200 000 ordinary shares. Only 100 000 of the ordinary shares were issue at R250 each. & Ordinary dividends of 30 cents per share were declared on 29 February 2020 should still De provided for all the shareholders. 7. Included in Accounts Receivable is Provisional tax paid of R40 000. 8. The following items are included in Accounts payable: Provision for credit losses Accrued expenses Income tax (Correctly calculated) 52 000 3 000 1 000 9.Hanger Ltd has two bank accounts at XYZ Bank and UVW Bank respectively. On 29 February 2020, the XYZ Bank account had an overdrawn balance of R2 500 10.Investment consists of the following: A Limited Z(Pty) Limited Cost price R10 000 R69 000 Stock value per share on 29/2 R4,20 Directors valuation R21 000 R59 000 Number of shares 5 000 10 000 Dividends paid during the year 50c/share 0 Dividends declared end of year 0 40c/share All the above shares are Ordinary shares. Dividends declared has not yet been recorded. YOU ARE REQUIRED to Prepare the Statement of financial position and the Statement of changes in equity of Hanger Limited at 29 February 2020 in accordance with the requirements of the Companies Act 71 of 2008 and International Financial Reporting Standards. Show the all the notes to the financial statements of Hanger Limited at 29 February 2020. Comparative figures may be ignored. 15 MARKS QUESTION 2 statement for the financial year ended 29 February 2020 Coronus Limited is a company specializing in the deep cleaning of offices and buildings. The following information still needs to be accounted for before preparing the correction incorrectly debited to vehicles, as a separate new vehicle. This fuel had all been used during During 2020, it was discovered that fuel purchased on 1 June 2018 for R120 000 had been the 2019 financial year. The taxable profit and tax base were correctly calculated in all your company depreciates vehicles on the straight-line basis at 20% per annum to ni residual affected. The cost of vehicles, bought on 1 March 2016, amounted to R800 000. The values (apportioned for periods less than a year). The accountant has already processed the The following draft extracts of the Statement of comprehensive income and Statement of financial position have been presented to you (the additional information above has not year . depreciation on vehicles for 2020, before correcting the error mentioned Additional information: All amounts are considered to be material The income tax rate is 30%. been taken into account in the preparing these statements): CORONUS LIMITED DRAFT EXTRACTS FROM STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 29 FEBRUARY 2020 2020 2019 R R Profit before tax 900 000 800 00 (200 000) (150 000) 650 000 700 000 Income tax expense Profit for the year Other comprehensive income for the year Total comprehensive income for the year 700 000 650 000 CORONUS LIMITED DRAFT EXTRACT FROM STATEMENT OF FINANCIAL POSITION AT 29 FEBRUARY 2020 2 2020 2019 2018 R R R Vehicles carrying amount 238 000 422 000 480 000 YOU ARE REQUIRED to 1. Show journal entries that would need to be processed to effect the correction of the error. (6 Marks) 2. Disclose how the correction of the error affects the entity's annual financial statements, including notes, for the year ended 29 February 2020 in conformity with International Financial Reporting Standards. (9 Marks) Show your calculations. 15 MARS FEBRUAR QUESTION 3 Property statement for the financial year ended 29 February 2020. Coronus Limited is a company specializing in the deep cleaning of offices and buildings. The following information still needs to be accounted for before preparing the corred After the completion of the concept financial statements for the year ended 29 February 2020 As from 1 March 2019, the total expected useful life of the plant changed from The plant was purchased on 1 March 2016 at a cost of R660 000. Depreciation on plants provided on the straight line method. The accountant has already processed the depreciation The following draft extracts of the Statement of comprehensive income and Statement of to to . in estimate: YOU 1 years to 5 years. The estimated residual value of the plant changed from RO to R30 000 There will be no change in the depreciation method. on plant for 2020, before taking into consideration the changes mentioned above Additional information: All amounts are considered to be material The income tax rate is 30%. financial position have been presented to you the additional information above has not your been account ) CORONUS LIMITED DRAFT EXTRACTS FROM STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 29 FEBRUARY 2020 2020 2019 R R 900 000 800 00 Profit before tax Income tax expense (200 000) 700 000 (150 000) 650 000 Profit for the year Other comprehensive income for the year Total comprehensive income for the year 700 000 650 000 CORONUS LIMITED 90 DRAFT EXTRACT FROM STATEMENT OF FINANCIAL POSITION AT 29 bus 2.30000 s FEBRUARY 2020 The 2020 2019 2018 cial R R R 245 000 465 000 20, 645 000 property, plant and equipment Plant carrying amount Vehicles carrying amount 220 000 330 000 440 000 238 000 422 000 480 000 YOU ARE REQUIRED to 1. Calculate the effect of the change in estimate using the re-allocation method, showing clearly the effect on the current year depreciation and the future years depreciation (5 Marks) 2. Show journal entries that would need to be processed to effect: the change in accounting estimate. (2 Marks) 3. Disclose how the entity's annual financial statements, including notes, are affected for the year ended 29 February 2020 in conformity with International Financial Reporting Standards: the change in estimate. (8 Marks) Show your calculations. The following balances for 29 February 2020 were taken from the books of Harry QUESTION 1 company that manufactures toys: Notes 1 2 3 4 5 6 7 Patents at carrying amount - 29/2/2020 Machinery and equipment at carrying amount - 29/2/2020 Vehicles at carrying amount - 29/2/2020 Land and buildings at valuation Revaluation reserve Share capital - Ordinary shares Retained earnings - 1/3/2019 Profit for the year Accounts receivable Inventories: Raw materials Work in progress (toys) Finished toys Stationery Accounts Payable Bank and cash on hand Investments 12% mortgage over land and buildings (redeemable in 2025) Additional information: R 18 000 136 000 30 000 280 000 40 000 250 000 44 000 165 000 91 000 24 000 26 000 12 000 1 000 135 000 7 000 79 000 70 000 8 9 10 1. The patents were obtained on 1 March 2013 at R45 000, R4 500 is written off against profit annually. 2. Machinery and equipment were obtained on 1 June 2018. Depreciation is provided for at, 20% per annum on the reducing balance method. 3.Depreciation on vehicles is provided for at 20% per annum on the straight line method. The vehicles were obtained on 1 September 2017. 4.Hanger Ltd policy is to revalue land and buildings every three years at market value with reference to observable prices in an active market, by an independent sworn appraiser. The following information was obtained from the asset register: Cost of Erf 11, Johannesburg 2013 240 000 Revalued on 1 February 2017 40 000 Revalued on 1 February 2020 70 000 350 000