Please answer ASAP:
Odyssey commenced trading on 1 January 2020 as a manufacturing, retail and distribution business, raising share capital of 900,000 For its financial reporting period ended 31st December 2020, Odyssey earned revenue of 800,000 and its draft operating expenses for the year amounted to 640,000. These figures represent the results of Odyssey's entire business, including all its divisions, but do not include depreciation, amortisation or impairment. Additional information 1 On 1st January 2020, Odyssey purchased premises for its business for 190,000, also incurring in addition to this purchase price) surveyors' fees of 5,700, solicitors' fees of 2,375 and Stamp Duty Land Tax of 9,500. These fees and stamp duty have been included in the operating expenses figure above. By 31st December 2020, the property had a Market Value of 412,000, and Odyssey expects its value to continue to rise into the foreseeable future. 2 On 1st January 2020, Odyssey acquired an unincorporated business for 356,000, comprising the following values: Aphrodite brand (indefinite economic life) 21,000 Trained staff 10,000 Land and buildings 175,000 Machinery 30,000 Van 40,000 Inventories 20,000 Other unidentified value 60,000 356,000 That business operates from a single facility, producing a single product for a single major industrial customer. It continued to operate in broadly the same way following its acquisition by Odyssey, as a largely autonomous division, "Aphrodite Division". However, the customer has expressed an ethical objection to some of Odyssey's activities and does not intend to provide repeat business. Odyssey has found an alternative customer, and anticipates that the division will be able to generate net cash flows of 40,000 per annum for the foreseeable future. If Odyssey were to sell the Aphrodite Division as a going concern, it could obtain proceeds of 300,000. At 31st December 2020, Aphrodite Division had the same land, buildings, plant and machinery as at the beginning of the year. The land and buildings now had a fair value of 269,000, and the van could be sold for 36,000. Aphrodite Division's inventories at that date, measured at cost, amounted to 132,000, and it had no cash, trade receivables or liabilities. 3 Odyssey uses the cost model for measuring its plant and machinery, and the revaluation model for measuring its land and buildings. It usually depreciates plant and machinery over a six-year life, and vehicles over a ten-year life, using straight-line depreciation. You may assume that Aphrodite Division's machinery and van were new on 1st January 2020. Both the machinery and van are expected to have zero scrap values at the end of their lives. 4 Odyssey's weighted average cost of capital is 10%. 5 Apart from the items described above, there were no other assets or liabilities at the reporting date (except for cash), nor were there any other revenues or expenses. 6 Ignore Corporation Tax and VAT. Required (a) Prepare a statement of Financial Position for Odyssey as at 31st December 2020 and a Statement of Comprehensive Income for the year then ended, in accordance with International Financial Reporting Standards (including IASs). You may calculate the cash figure as the balancing figure in the Statement of Financial Position (19 marks) (b) If, on 31st December 2021, Odyssey's premises referred to in note 1 were worth 100,000, what impact would that have on Odyssey's accounts for the year ending on that date? (2 marks) (c) What difference would it make to your answer if the "other unidentified value in note 2 included work done on the development of a new product? (4 marks) Odyssey commenced trading on 1 January 2020 as a manufacturing, retail and distribution business, raising share capital of 900,000 For its financial reporting period ended 31st December 2020, Odyssey earned revenue of 800,000 and its draft operating expenses for the year amounted to 640,000. These figures represent the results of Odyssey's entire business, including all its divisions, but do not include depreciation, amortisation or impairment. Additional information 1 On 1st January 2020, Odyssey purchased premises for its business for 190,000, also incurring in addition to this purchase price) surveyors' fees of 5,700, solicitors' fees of 2,375 and Stamp Duty Land Tax of 9,500. These fees and stamp duty have been included in the operating expenses figure above. By 31st December 2020, the property had a Market Value of 412,000, and Odyssey expects its value to continue to rise into the foreseeable future. 2 On 1st January 2020, Odyssey acquired an unincorporated business for 356,000, comprising the following values: Aphrodite brand (indefinite economic life) 21,000 Trained staff 10,000 Land and buildings 175,000 Machinery 30,000 Van 40,000 Inventories 20,000 Other unidentified value 60,000 356,000 That business operates from a single facility, producing a single product for a single major industrial customer. It continued to operate in broadly the same way following its acquisition by Odyssey, as a largely autonomous division, "Aphrodite Division". However, the customer has expressed an ethical objection to some of Odyssey's activities and does not intend to provide repeat business. Odyssey has found an alternative customer, and anticipates that the division will be able to generate net cash flows of 40,000 per annum for the foreseeable future. If Odyssey were to sell the Aphrodite Division as a going concern, it could obtain proceeds of 300,000. At 31st December 2020, Aphrodite Division had the same land, buildings, plant and machinery as at the beginning of the year. The land and buildings now had a fair value of 269,000, and the van could be sold for 36,000. Aphrodite Division's inventories at that date, measured at cost, amounted to 132,000, and it had no cash, trade receivables or liabilities. 3 Odyssey uses the cost model for measuring its plant and machinery, and the revaluation model for measuring its land and buildings. It usually depreciates plant and machinery over a six-year life, and vehicles over a ten-year life, using straight-line depreciation. You may assume that Aphrodite Division's machinery and van were new on 1st January 2020. Both the machinery and van are expected to have zero scrap values at the end of their lives. 4 Odyssey's weighted average cost of capital is 10%. 5 Apart from the items described above, there were no other assets or liabilities at the reporting date (except for cash), nor were there any other revenues or expenses. 6 Ignore Corporation Tax and VAT. Required (a) Prepare a statement of Financial Position for Odyssey as at 31st December 2020 and a Statement of Comprehensive Income for the year then ended, in accordance with International Financial Reporting Standards (including IASs). You may calculate the cash figure as the balancing figure in the Statement of Financial Position (19 marks) (b) If, on 31st December 2021, Odyssey's premises referred to in note 1 were worth 100,000, what impact would that have on Odyssey's accounts for the year ending on that date? (2 marks) (c) What difference would it make to your answer if the "other unidentified value in note 2 included work done on the development of a new product? (4 marks)
