Question
Q1. . (1.5 marks) a. IFRS requires capitalizing actual interest (with modification). What items are to be considered for capitalization? Explain. b. On November 1,
Q1. . (1.5 marks)
a. IFRS requires capitalizing actual interest (with modification). What items are to be considered for capitalization? Explain.
b. On November 1, 2010, Saif Company contracted Ahmed Construction Co. to construct a building for $1,600,000 on land costing $400,000 (purchased from the contractor and included in the first payment). Saif made the following payments to the construction company during 2011.
Date | Amount $ |
1st Jan | 500,000 |
1st Mar | 400,000 |
1st Jun | 350,000 |
1st Sep | 500,000 |
1st Dec | 250,000 |
Required: Compute weighted-average accumulated expenditures for 2011
Q2. A long-lived tangible asset is impaired when a company is not able to recover the assets carrying amount either through using it or by selling it. The management to identify whether the asset has impairment or no impairment conducts an impairment test.
Explain how the impairment test conducted in both situations with numerical examples. (1 Mark)
Q3. Explain the classified Intangible Assets with examples. (0.5Mark)
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