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QUESTION ONE a. Mawu Ltd runs a unit in Ablekuma Metropolis that has suffered a massive drop in income due to failure in its technology

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QUESTION ONE a. Mawu Ltd runs a unit in Ablekuma Metropolis that has suffered a massive drop in income due to failure in its technology on 1 January 2018. As a result, the following carrying amounts were recorded in the books immediately before the impairment test. GH Goodwill 20,000 Technology 5,000 Equipment 10,000 Land 50,000 Buildings 30,000 OFF Other net assets 40,000 The value in use of the unit is estimated at GH$85,000 and Mawu has received an offer of GH75,000 for the unit. The technology is worthless, following its complete failure. Other net assets include inventory, receivables and payables. It is considered that the carrying amount of other net assets is a reasonable representation of its net realisable value. Required: In accordance with IAS 36: Impairment of Assets, determine the impairment loss (if any) and allocate the loss. (5 marks) b. XYZ Enterprise on 1" September, 2019 sold mining equipment to Alaho Quarry. XYZ Enterprise also agreed to service the machine for a two-year period from 1st September, 2019 for no additional charge. The total amount payable by the customer for this arrangement is GHE810,000 if Alaho Quarry pays by 31 January, 2020. The directors of XYZ Enterprise consider it highly probable the customer will pay for the equipment in January, 2010 The stand-alone selling price of the machine was GH700, 000 and XYZ will normally expect to receive GHe 140,000 in consideration for providing two years' servicing of the equipment. Required: In accordance with IFRS 15: Revenue from Contract with Customers, account for the above transactions in the financial statements of XYX Enterprise for the year ended 30th September, 2019 (7 marks) c. Undeniably, profitability is the ultimate goal of companies and readers of a company's financial statements are very much interested in the reported profit figure. The profit figure is achieved by the preparation of the statement of profit or loss and the statement of financial position. If the foregoing is the case, give any THREE (3) reasons why companies should bother themselves about the statement of cash flows? (3 marks) 1

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