IFRS GAAP Financial Statements & Journal Entries

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Brussels Corp.. a ness U.S. -based company. is interested in financial reporting under international accounting standards (IFRSI. It has decided to account for its transactions under both U.S. (GAAP and ITRS for 3 one car period. Al the end of the one year period. Brussels will prepare its financial statements and notes under both U.S. GAAP and IFRS. As the accountant. you are responsible for: journalizing the transactions and preparing any necessary adjusting entries January 2.2014 Brussels issues 25,000 shares of mandatorily redeemable preferred stock for $247 per share. February 28, 2014 Brussels purchases 200.000 inventory items at a cost of $36 per item. Brussels will use the perpetual method and FIFO, if the methods are allowed (Brussels pays cash.) June 30. 2014 Brussels leases two similar assets in two different manufacturing plants. The leases were separately negotiated. the assets each base an economic life of ten years and a seven year lease. Brussels incremental borrowing rate is 6%. The leases neither transfer ownership nor has c bargain purchase options. Additional details for each leased asset follow: Asset A: Has a fair market value of S400.000 and payments under the lease are S60.000 each year Ihe first payment is due at the inception of the lease. Asset B: Has a fair market value of $400.000 and payments under the lease are S61.000 each year. The first payment is due at the inception of the lease. December 31.2014 - Additional Information: I. The following information is available for the inventory items purchased on February 28. 2014: Net Realizable Value (NRV) = $36.40 Replacement Cost = $34.80 NR V minus normal profit margin = $32.20 Ignore taxes for this exercise