Question 1 (Continued) (B) IAS 38 Intangible Assets prescribes the accounting treatment for intangible assets. PKH Bhd. (PKH) has internally developed intangible assets comprising the capitalised expenses of the acquisition and development of electronic map data which show the primary fishing grounds globally. The intangible assets generate revenues for the company when they are used by the fishing fleet as PKH is able to identify the key fishing grounds by using the data that they have obtained from the electronic map. As a result, PKH has faster access to fishery resources over other companies. The intangible assets are material assets in the statement of financial position. PKH has developed a database of the electronic maps. The costs incurred in providing information about a certain region of the world are capitalised. The performance of the electronic maps is improved in terms of technical feasibility and commercial viability as PKH's technical team is capable of converting the ideas into working systems and it has the ability to compete effectively with its competitors. The costs related to maintaining the information about a certain region at that same standard of performance are expensed off to profit or loss. PKH's accounting policy states that intangible assets are valued at historical cost. Required: Discuss with reasons whether the electronic maps have been properly dealt with in accordance to IAS 38 Intangible Assets. (12 marks) [Total: 25 marks]N ABFA3044 BUSINESS ACCOUNTING Question 1 (A) (a) Coach Apparel Sdn. Bhd. (Coach Apparel) was established on 1 December 2019. Its business operation involves designing and selling shirts. The company has a wide range of clientele who are users of financial information. The company is unsure about the users and has provided the following information: i. This group of users is an essential part of any business as they provide loan to the business. They observe the performance of the business to know, whether it is making progress as projected to ensure the safety and recovery of the loan advanced. ii. The group of users are concerned about the operation of the business since it makes contribution to the economy in many ways, e.g., employment of people, patronage to suppliers. iii. The users are interested in the financial information of the company as this enable them to assess the ability of the company to provide certain benefits such as remuneration, employment opportunities and retirement benefits. iv. The users need to know that whether the company can continue to supply them in the future especially when they formed a long-term contract with the company. Required: Identify the key users in each of the above group and determine whether they are internal or external users. (8 marks) (b) Michael Khor Bhd. (MK) is assessing the valuation of its inventories. It has a significant quantity of a product and needs to evaluate its value for Statement of Financial Position purposes. Sales of the product are high, but it incurs high production costs. The reason for its success is that a sales commission of 20% of the listed selling price is paid to the salesforce. The product is collected from the warehouse of MK by the customers. The following details relate to this product: RM per unit List price - normal selling price 50.00 Discounts on selling price 2.50 Warehouse overheads until estimated sales date 4.00 Basic salaries of sales team 2.00 Cost of product 35.00 Required: Based on the prudence concept, calculate the value per unit of the inventories in the financial statements