Question 1. Emily Co chooses to revalue property in accordance with IAS 16. On 31 December 20X1, its head office building had a fair value of $30m when it is measured in the financial statements at historical cost of $25m with $4.5m of accumulated depreciation charged against it. Which of the following statements is true?

A revaluation gain of $5m should be recorded through other comprehensive income, grouped with other items that will not subsequently be reclassified to profit or loss

A revaluation gain of $5m should be recorded through profit or loss

A revaluation gain of $9.5m should be recorded through other comprehensive income, grouped with other items that will not subsequently be reclassified to profit or loss

A revaluation gain of $9.5m should be recorded through profit or loss

Question 2. In accordance with IAS 41 Agriculture, which of the following statements is correct?

A fruit tree is initially measured at cost

Dairy cattle are initially measured at fair value

Stores of harvested tea are within the scope of IAS 41

A gain on remeasurement of sheep to fair value is reported in other comprehensive income

Question 3. IAS 1 Presentation of Financial Statements envisages that an entity's financial statements should be presented at least every 12 months. Which of the following statements is correct according to IAS 1?

A reporting period can exceed 12 months but the reason must be disclosed.

A reporting period can be less than 12 months; no disclosure of reason is required.

A reporting period can be more or less than 12 months but the reason must be disclosed.

A reporting period can exceed 12 months but not 18 months; no disclosure of reason is required

Question 4. Bush Co leases a train over a 3-year term commencing on 1 June 20X5. The discounted present value of the future lease payments is $64,427. The interest rate implicit in the lease is 8% and lease payments of $25,000 are required annually in arrears. What is the carrying amount of the lease liability at 31 May X7?

$18,988

$42,581

$44,581

$23,148

Question 5. X Co issued 10,000 share appreciation rights to each of its 12 directors on 1 July 20X5. The rights had a fair value of $4 each at 1 July 20X5 and vest if the directors remain employed for 4 years. At 30 June 20X6 the rights have a fair value of $5.50 each and no directors have left or are expected to leave. What expense is recognised in the financial statements of X Co in the year ended 30 June 20X6?

$120,000

$165,000

$480,000

$660,000

Question 6. The following information relates to Grass Co for the years ended 31 December 20X1 and 20X2:

	20X1 $	20X2 $
Profit before tax	24,000	18,000
Trade receivables	135,000	129,000
Trade payables	112,000	101,000
Inventory	76,000	67,000
Income tax paid	8,000	4,500

What is Grass Co's net cash from operating activities for the year ended 31 December 20X2?

$22,000

$9,500

$17,500

$20,000