Q1. Presented below are the components related to an office building that ABC Company is considering purchasing for SAR10,000,000. Component Useful Life Value Building structure 60-year life 5,400,000 Building engineering 30-year life 2,400,000 Building external works 30-year life 900,000 Instructions: (2 marks) (a) Compute depreciation expense for 2010, assuming that ABC uses component depreciation. (6) Assume that the building engineering was replaced in 20 years at a cost of SAR 2,600,000 cash. Prepare the entry to record the replacement of the old component with the new component. Answer: Q2. a. Explain impairment of long-lived tangible. b. The accountant of X. Ltd conducted an impairment test on a machinery. The carrying amount of machinery was SAR 195,000, its fair value less costs to sell is SAR 170,000, and its value-in-use is SAR 165,000. Is there impairment or no impairment on machinery? If impairment exists what would be the journal entry. (2 Mark) Answer: Q3. List the classified Intangible Assets with examples. (2 Marks) Answer