In the preparation of the financial statements for the year ended 31 December 2019 of Strong Ability Company (SAC), the following events have taken place after the end of the reporting period but before the date when the financial statements are authorised for issue (i e 30 April 2020) On 5 January 2020, SAC received an invoice of $400,000 from a supplier for the provision of information technology services for the month of December 2019 This transaction has not been recorded by SAC in any of its accounts On 20 January 2020, SAC discovered that its accounting department overstated sales revenues by $800,000 for the reporting period ended 31 December 2019 On 30 December 2019, SAC bought $30 million worth of shares in Mining Resources Limited (MRL), a listed mining company in Australia, in anticipation of MRL receiving exclusive rights to mine for uranium in the North West region of Australia On 15 March 2020, the Australian government decided to ban uranium mining for the next five years, which resulted in the value of SACs shareholding in MRL declining by $12 million on that day Required Explain whether the above events are adjusting or non adjusting events and their corresponding accounting treatments

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Posted on Jul 17, 2024

In the preparation of the financial statements for the year ended 31 December 2019 of Strong Ability Company (SAC), the following events have taken place

In the preparation of the financial statements for the year ended 31 December 2019 of Strong Ability Company (SAC), the following events have taken place after the end of the reporting period but before the date when the financial statements are authorised for issue (i.e. 30 April 2020):

On 5 January 2020, SAC received an invoice of $400,000 from a supplier for the provision of information technology services for the month of December 2019. This transaction has not been recorded by SAC in any of its accounts.

On 20 January 2020, SAC discovered that its accounting department overstated sales revenues by $800,000 for the reporting period ended 31 December 2019.

On 30 December 2019, SAC bought $30 million worth of shares in Mining Resources Limited (MRL), a listed mining company in Australia, in anticipation of MRL receiving exclusive rights to mine for uranium in the North-West region of Australia. On 15 March 2020, the Australian government decided to ban uranium mining for the next five years, which resulted in the value of SACs shareholding in MRL declining by $12 million on that day.

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Explain whether the above events are adjusting or non-adjusting events and their corresponding accounting treatments.