Question No -03 Supreme Limited purchased a plant and incur following cost at 01 January 2021 Purchase price 1200,000 Sale tax refundable (17%) 204,000 Income Tax non-refundable 60,000 Import duties - non-refundable 80,000 Installment Cost 20,000 Fuel (incurred while transporting the plant to the factory) 50,000 Administration costs 120,000 Staff party to celebrate the acquisition of the new plant 50,000 Staff training 70,000 Testing to ensure plant fully operational before start of production 43,000 Proceeds from sale of samples and by-products that were produced during testing 6,000 Advertising of the 'amazing widgets' to be produced by the new plant 88,000 Initial operating loss 40,000 Requirement: Useful life of the plant is 07 years with RS 200,000 residual value. Requirement a. Calculate the cost at which plant is capitalized according to IAS-16 (Explain the reason of exclusion and inclusion of Cost). (3 Marks) b. Discuss accounting treatment, the company shall follow for the year 2020 to 2025 (Show all necessary workings and Journal entries). (3 Marks) c. If Company decided to sale the plant at 01 January 2026, What should be the accounting treatment of disposal in following cases (Show all necessary workings and entries). (4 Marks) Disposal proceed 750,000 E Disposal proceed 350,000