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Muff and Tuff Limited consists of a chain of muffin outlets that makes and sells muffins to the public. The financial director is finalising the
Muff and Tuff Limited consists of a chain of muffin outlets that makes and sells muffins to the public. The financial director is finalising the preparation of the financial statements for the year ended 31 December 2017 and has identified the following issues for discussion in a meeting with the companys IFRS consultant: Discuss how the below issues should be recognised and disclosed in the financial statements of Muff and Tuff Limited at 31 December 2017 with reference to International Financial Reporting Standards.
- Damages awarded against Muff and Tuff Limited resulting from a court case decided on 22 December 2017. The judge has announced that the amount of damages will be set at a future date, expected to be in March 2018. Muff and Tuff Limited has received advice from its lawyers that the amount of the damages could be anything between R100 000 and R30 million. (10)
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