PROBLEM 2.11

Recording of assetsState whether or not an asset should be recorded in the balance sheet of WXY Ltd as at 30 June 2019 in eachof the following situations. State the amount (if any) of the asset, and any assumptions made.1On 15 May 2019, XYZ Ltd paid Insurance Ltd $40 000 for an insurance premium. The premium coverslosses incurred due to fire, theft or other causes up to 14 May 2020.2XYZ Ltd paid $20 000 for a patent in April 2019.3XYZ Ltd has just hired a new general manager who is an expert in the business carried on by XYZ Ltd. Withthe help of this person, the company is expected to increase its annual profits by $700 000. The generalmanagers salary is $400 000 per annum.4XYZ Ltd purchased land in 2012 for $100 000. The market value of this land is $150 000 as at 30 June 2019.5Equipment purchased for $2 million and costs an additional $400 000 to install.6Purchased a computer with asticker priceof $3000 but because they were a regular customer XYZ wascharged only $2700.