QUESTION 2 45 MARS Ignore tation Contandswel established retail comany with a focus on providing fashion clothing and tationery Brands Costown for putting their content on torent trends to allow customers to fun with the initial. They provide the hottest with them to make the tuitame The only lock pod but ab eod. Co consists of standalonestly in malwilan platom te products Co 13 Decemberred. You are the count Cand are the process of railing the financial statements. You were grovided with the following Information Factory building in Manilang On April 2018, co staned the construction of stay tulding and incurring cauction cost The building is qualifying at its 23 Borrowing Costco had to hos otrom capita tank and received the 2018 der to con the building. The interest rate applicable to the loan was per year, compounded annually. Co pod construction of 100 000 only be Apr 2018 September 2016 Surplus fonds were invested in a feed that came per cd then the 2012, the same date at the factory building was sostantial comelete. It was towever only available for use on ! November 2018 due to a few we remaining in touches that needed to be made. The total nu fie of the buildings year with a red value of 5.000 The for all the building was uit to the carrying out on 31 December 2013 and the title of the building amounted R2 100 000 on 31 December 2015. As the Coviandere also had as maton Mahing and its economy, the net replacement value of the bolding, as obtained from the expert valutor Price amounted to: 48000 December 2010 Building in ander Co purchased the busing on October 2020 for RO00 000 tons of four floors of which time will be rented out. The man seday. The first floor wie sons of Co this date was clear the far value of the building would be able continuing bacong to the garden waaring. According to the purchase preement they will have to remove the ring hot and realitate the garden at the end of the buildings auf 20 The estimated that will lead the then the end of 20 yan amount to the bonding water for en such date on December 2020 the fair value of the building including provision for rehabilitation became really marlent of 200000. The result of the building to Machinery Due to the pandemic that had an impact on the dotting industry. Co tecided to start focusing on into homework comes instead of format professional or comes the decision was made on May 220 to change the winery machine with a camping value of 0.000 til em on 1 May 2013 amounted to a formert riting machine from with ter value of R320 000. The thirwale of the sath embroidery machine on the same date was 3200 000. Co had to pay the transport cost to get the new macintos premises as well as to deliver the tambdary machine for the termotort for the woman mounted to $15.000 hecting to transport of the paid on May 2020 Marine precated curtean tagit ut au The chama did not commercial substance. Co had no other machinery other than what is evident from this How Delivery Co gurchased a delivery on 1 August 2015 for R300 000 ton with the transport of its In total. All these arests were din cash on Aust 2019. The totale of the vanis five Wears with an arred value. The man win involved in accident in Potchefstroom durine December 2015 when the trently bumped into another cars the drivers cel phone while in No one was red but the bumper and some wage chant yet gained the bungerar nesprayel the paint as the van cansill operate without bene repaired The wider did not affect me te of the The recoverable mount of the delivery mounted 50 000 on December re Delivery van Co purchased a delivery van on 1 August 2019 for R300 000 to assist with the transport of its employees. Co incurred costs of R4000 to paint the cologo on its doors. Co also agreed to pay for all cost of the driver to obtain his driver's licence to be able to transport people. This amounted to R1 000 in total. All these amounts were paid in cash on 1 August 2013. The total useful life of the van is five years with an insignificant residual value. The van was involved in a minor accident in Potchefstroom during December 2019 when the driver accidently bumped into another car as the driver was using his cell phone while driving. No one was injured but the bumper and some paint was damaged. Co has not yet repaired the bumper or resprayed the paint as the van can still operate without being repaired. The accident did not affect the useful life of the van. The recoverable amount of the delivery van amounted to R250 000 on 31 December 2019, 778 As online sales increased during the 2020 lockdown period, the interest in second hand delivery vans increased as well, therefore the value of the van increased and the following values were determined as at 31 December 2020 value in use of R195000, fair value of R227 000 and expected selling costs of R7 000 Accounting policies and other information Co accounts for owner-occupied land and buildings on the revaluation model in terms of AS 16 Property. Plant and Equipment, with revaluations taking place at the end of the year, on the net replacement value method All other property, plant and equipment is accounted for on the cost model in accordance with IAS 16. Investment properties are accounted for on the fair value model in terms of 15 40 Investment Properties. Assume an appropriate before tax discount rate of 10% per annum (compounded annually) Depreciation is accounted for on the straight-line method by Co. REQUIRED: MARKS Subtotal Total 35 36 (a) Prepare the property, plant and equipment note of cos at 31 December 2020. Additional qualitative and quantitative information as well as the total column is not required. Communication skills - presentation and layout (b) Discuss (1) the impact of the sentence it was unclear if the fairwolve of the building would be reliably measurable on a continuing boss on the subsequent measurement and discuss (2) the calculation of the subsequent measurement of the building in Vanderbijlpark in terme of IAS 40 Investment Properties for the year ended 31 December 2020 Communication skills - clarity of expression TOTAL MARKS 1 45 QUESTION 2 45 MARS Ignore tation Contandswel established retail comany with a focus on providing fashion clothing and tationery Brands Costown for putting their content on torent trends to allow customers to fun with the initial. They provide the hottest with them to make the tuitame The only lock pod but ab eod. Co consists of standalonestly in malwilan platom te products Co 13 Decemberred. You are the count Cand are the process of railing the financial statements. You were grovided with the following Information Factory building in Manilang On April 2018, co staned the construction of stay tulding and incurring cauction cost The building is qualifying at its 23 Borrowing Costco had to hos otrom capita tank and received the 2018 der to con the building. The interest rate applicable to the loan was per year, compounded annually. Co pod construction of 100 000 only be Apr 2018 September 2016 Surplus fonds were invested in a feed that came per cd then the 2012, the same date at the factory building was sostantial comelete. It was towever only available for use on ! November 2018 due to a few we remaining in touches that needed to be made. The total nu fie of the buildings year with a red value of 5.000 The for all the building was uit to the carrying out on 31 December 2013 and the title of the building amounted R2 100 000 on 31 December 2015. As the Coviandere also had as maton Mahing and its economy, the net replacement value of the bolding, as obtained from the expert valutor Price amounted to: 48000 December 2010 Building in ander Co purchased the busing on October 2020 for RO00 000 tons of four floors of which time will be rented out. The man seday. The first floor wie sons of Co this date was clear the far value of the building would be able continuing bacong to the garden waaring. According to the purchase preement they will have to remove the ring hot and realitate the garden at the end of the buildings auf 20 The estimated that will lead the then the end of 20 yan amount to the bonding water for en such date on December 2020 the fair value of the building including provision for rehabilitation became really marlent of 200000. The result of the building to Machinery Due to the pandemic that had an impact on the dotting industry. Co tecided to start focusing on into homework comes instead of format professional or comes the decision was made on May 220 to change the winery machine with a camping value of 0.000 til em on 1 May 2013 amounted to a formert riting machine from with ter value of R320 000. The thirwale of the sath embroidery machine on the same date was 3200 000. Co had to pay the transport cost to get the new macintos premises as well as to deliver the tambdary machine for the termotort for the woman mounted to $15.000 hecting to transport of the paid on May 2020 Marine precated curtean tagit ut au The chama did not commercial substance. Co had no other machinery other than what is evident from this How Delivery Co gurchased a delivery on 1 August 2015 for R300 000 ton with the transport of its In total. All these arests were din cash on Aust 2019. The totale of the vanis five Wears with an arred value. The man win involved in accident in Potchefstroom durine December 2015 when the trently bumped into another cars the drivers cel phone while in No one was red but the bumper and some wage chant yet gained the bungerar nesprayel the paint as the van cansill operate without bene repaired The wider did not affect me te of the The recoverable mount of the delivery mounted 50 000 on December re Delivery van Co purchased a delivery van on 1 August 2019 for R300 000 to assist with the transport of its employees. Co incurred costs of R4000 to paint the cologo on its doors. Co also agreed to pay for all cost of the driver to obtain his driver's licence to be able to transport people. This amounted to R1 000 in total. All these amounts were paid in cash on 1 August 2013. The total useful life of the van is five years with an insignificant residual value. The van was involved in a minor accident in Potchefstroom during December 2019 when the driver accidently bumped into another car as the driver was using his cell phone while driving. No one was injured but the bumper and some paint was damaged. Co has not yet repaired the bumper or resprayed the paint as the van can still operate without being repaired. The accident did not affect the useful life of the van. The recoverable amount of the delivery van amounted to R250 000 on 31 December 2019, 778 As online sales increased during the 2020 lockdown period, the interest in second hand delivery vans increased as well, therefore the value of the van increased and the following values were determined as at 31 December 2020 value in use of R195000, fair value of R227 000 and expected selling costs of R7 000 Accounting policies and other information Co accounts for owner-occupied land and buildings on the revaluation model in terms of AS 16 Property. Plant and Equipment, with revaluations taking place at the end of the year, on the net replacement value method All other property, plant and equipment is accounted for on the cost model in accordance with IAS 16. Investment properties are accounted for on the fair value model in terms of 15 40 Investment Properties. Assume an appropriate before tax discount rate of 10% per annum (compounded annually) Depreciation is accounted for on the straight-line method by Co. REQUIRED: MARKS Subtotal Total 35 36 (a) Prepare the property, plant and equipment note of cos at 31 December 2020. Additional qualitative and quantitative information as well as the total column is not required. Communication skills - presentation and layout (b) Discuss (1) the impact of the sentence it was unclear if the fairwolve of the building would be reliably measurable on a continuing boss on the subsequent measurement and discuss (2) the calculation of the subsequent measurement of the building in Vanderbijlpark in terme of IAS 40 Investment Properties for the year ended 31 December 2020 Communication skills - clarity of expression TOTAL MARKS 1 45