please answer 3&4!
Caspian Ply Lad is a business that manufactures and sells water filters. The business was established in 2013 and has grown to a large proprietary company with four owners. Olvia, Eliot Alexandra and Joh. The business operates from a large factory in Melbourne and is registered for Goods and Services Tax (GST) with financial year end on 30 June When it commenced its operations on 5 February 2013. Caspian was not able to purchase a building to manufacture water hers in and instead rented a factory. As the business has grown, the owners are considering purchasing the following assets for $440,000 IGST Inclusive 12021 Asset Fair value of asset Land $120.000 Building $330 000 Equipment $30.000 ETO $430,000 Purchasing these assets would involve additional costs: legal fees of $5.500 (GST Inclusive to register the land in business name. 56.600 (GST Inclusive) to rewire the bulling: 54.840 (GST inclusive for one year building insurance: $2.200 GST Inclusive) to conduct a safety inspection of the equipment. In addition the building wil include the following necessary tot optional fore and fing costs to ensure that the site is in a workable condition $11.000 IGST Inclusivel install solar panels $12.100 IGST Inclusive to install a surveillance system: $16.500 (GST Inclusive) to install a cooling heating system The building is expected to have a useful te of 20 years and an estimated res value of $50.000 The equipment is expected to have a useful life of 5 years and be used for 10.000 hours and an estimated residual value of $4,000. The equipment is expected to be used for 1.500 hours in year 1.2.200 hours in year 2.2.500 hours in year 3. 2.000 hours in year 4 and 1.800 hours is year 5. Caspian adopts the cost model to measure all existing non-current assets Because the business has seen a significant increase in demand for its products due to the pandemic in recent months, the owners believe existing non-current assets should be valued higher and t would be more appropriate to change to the evaluation model of measuring non-current assets Question 1: Determine the amounts to be recorded in the balance sheet Caspire to acquire land, building and equipment on 1 Ay 2001. Consider any additional amounts tot need to be included in the cost of the land building and equipment and justily why or why not they should be included. Show your calculations in a table in the appendix (the appendix is not counted in the word count Question 2: Calculate the annual depreciation expense over the life of both the building and equipment using al 3 methods of depreciation (where possible starting with year 1 ending 30 June 2022 For the building and equipment, select the method of depreciation you could advise the owners to use and justify your selection. To perform the above calculations, use Template for Financial Modeling PPE provided an Week 5 folder. You must use formulas in Excel to obtain the answers. Take screen shots of your template the show the answers and Excel formulas that you used and insert them directly in question 2 adet Question 3: Explain why the owners of Caspian would he to change se method of measuring noncurrent assets during the pandemic Discuss how changing the measurement of no current assets from the cost model to the revaluation model infuences the useliness of financial information weerence to the fundamental qualitative characteristics of information prescribed by the Conceptual Framework for financial reporting Caspian uses high-quality components in manufacturing of water hers. However, some manufacturing defects are unavoidable. For the year ended 30 June 2021. Caspian recorded $950.000 of net sales. Based on prior period, around 1% of net sales are claimed as warranties. The owners believe the way amount should be expensed in the period when the claims take places which is normally in the period following the sale Option 4. With reference to the Conceptual Framework explain whether you agree with the owners on recording of warranties as an expense in the pened the claims are made fret explain how amantes should be recorded and provide a double-entry to record warties for the year ended 30 June 2021 With more people staying at home because of the pandemic the business has seen a significant increase in demand for its products. This led the management to employ 2 additional stand will require the payroll team to ensure employee benefits are correctly set up for the new employees was determined that new staff would earn gross salaries of $3,000 per week with related deductions and on costs: PAYGholding tax 800 employer superannuation payment of 95%. parotax of 4.25% Won cover of employee contribution to superannuation of $150 and employee contributions to insurance fees of $20 Caspian Ply Lad is a business that manufactures and sells water filters. The business was established in 2013 and has grown to a large proprietary company with four owners. Olvia, Eliot Alexandra and Joh. The business operates from a large factory in Melbourne and is registered for Goods and Services Tax (GST) with financial year end on 30 June When it commenced its operations on 5 February 2013. Caspian was not able to purchase a building to manufacture water hers in and instead rented a factory. As the business has grown, the owners are considering purchasing the following assets for $440,000 IGST Inclusive 12021 Asset Fair value of asset Land $120.000 Building $330 000 Equipment $30.000 ETO $430,000 Purchasing these assets would involve additional costs: legal fees of $5.500 (GST Inclusive to register the land in business name. 56.600 (GST Inclusive) to rewire the bulling: 54.840 (GST inclusive for one year building insurance: $2.200 GST Inclusive) to conduct a safety inspection of the equipment. In addition the building wil include the following necessary tot optional fore and fing costs to ensure that the site is in a workable condition $11.000 IGST Inclusivel install solar panels $12.100 IGST Inclusive to install a surveillance system: $16.500 (GST Inclusive) to install a cooling heating system The building is expected to have a useful te of 20 years and an estimated res value of $50.000 The equipment is expected to have a useful life of 5 years and be used for 10.000 hours and an estimated residual value of $4,000. The equipment is expected to be used for 1.500 hours in year 1.2.200 hours in year 2.2.500 hours in year 3. 2.000 hours in year 4 and 1.800 hours is year 5. Caspian adopts the cost model to measure all existing non-current assets Because the business has seen a significant increase in demand for its products due to the pandemic in recent months, the owners believe existing non-current assets should be valued higher and t would be more appropriate to change to the evaluation model of measuring non-current assets Question 1: Determine the amounts to be recorded in the balance sheet Caspire to acquire land, building and equipment on 1 Ay 2001. Consider any additional amounts tot need to be included in the cost of the land building and equipment and justily why or why not they should be included. Show your calculations in a table in the appendix (the appendix is not counted in the word count Question 2: Calculate the annual depreciation expense over the life of both the building and equipment using al 3 methods of depreciation (where possible starting with year 1 ending 30 June 2022 For the building and equipment, select the method of depreciation you could advise the owners to use and justify your selection. To perform the above calculations, use Template for Financial Modeling PPE provided an Week 5 folder. You must use formulas in Excel to obtain the answers. Take screen shots of your template the show the answers and Excel formulas that you used and insert them directly in question 2 adet Question 3: Explain why the owners of Caspian would he to change se method of measuring noncurrent assets during the pandemic Discuss how changing the measurement of no current assets from the cost model to the revaluation model infuences the useliness of financial information weerence to the fundamental qualitative characteristics of information prescribed by the Conceptual Framework for financial reporting Caspian uses high-quality components in manufacturing of water hers. However, some manufacturing defects are unavoidable. For the year ended 30 June 2021. Caspian recorded $950.000 of net sales. Based on prior period, around 1% of net sales are claimed as warranties. The owners believe the way amount should be expensed in the period when the claims take places which is normally in the period following the sale Option 4. With reference to the Conceptual Framework explain whether you agree with the owners on recording of warranties as an expense in the pened the claims are made fret explain how amantes should be recorded and provide a double-entry to record warties for the year ended 30 June 2021 With more people staying at home because of the pandemic the business has seen a significant increase in demand for its products. This led the management to employ 2 additional stand will require the payroll team to ensure employee benefits are correctly set up for the new employees was determined that new staff would earn gross salaries of $3,000 per week with related deductions and on costs: PAYGholding tax 800 employer superannuation payment of 95%. parotax of 4.25% Won cover of employee contribution to superannuation of $150 and employee contributions to insurance fees of $20
