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If an entity regularly fails to pay its suppliers by the normal due dates, it may lead to a number of problems: 3 Having insufficient cash to settle trade payables; (ii) Difficulty in obtaining credit from new suppliers; (i) Reduction in credit rating; (iv) Settlement of trade receivables may be delayed. Which TWO of the above could arise as a result of exceeding suppliers' trade credit terms? A (i) and (ii) B (i) and (iii) C (ii) and (iii) D (iii) and (iv)CI purchased equipment on 1 April 2003 for $100,000. The equipment was depreciated using the reducing balance method at 25% per year. CI's balance sheet date is 31 March. Depreciation was charged up to and including 31 March 2006. At that date, the recoverable amount was $28,000. Calculate the impairment loss on the equipment according to IAS 36 Impairment of Assets.List THREE possible reasons why governments set deadlines for filing returns and/or paying taxes.IAS 1 Presentation of Financial Statements encourages an analysis of expenses to be presented on the face of the income statement. The analysis of expenses must use a classification based on either the nature of expense, or its function, within the entity such as: Raw materials and consumables used; Distribution costs; iii) Employee benefit costs; iv) Cost of sales; (v) Depreciation and amortisation expense. Which of the above would be disclosed on the face of the income statement if a manufacturing entity uses analysis based on function? A (i), (ii) and (iv) B (ii) and (iv) C (i) and (v) D (ii), (ii) and (v)The International Accounting Standards Board's (IASB) Framework for the Preparation and Presentation of Financial Statements (Framework) provides definitions of the elements of financial statements. One of the elements defined by the framework is "expenses". In no more than 35 words, give the IASB Framework's definition of expenses.CN started a three year contract to build a new university campus on 1 April 2004. The contract had a fixed price of $90 million. CN incurred costs to 31 March 2006 of $77 million and estimated that a further $33 million would need to be spent to complete the contract. CN uses the percentage of cost incurred to date to total cost method to calculate stage of completion of the contract Question 1.6 Calculate revenue earned on the contract to 31 March 2006, according to IAS 11 Construction Contracts.CY had the following amounts for 2003 to 2005: Year ended 31 December: 2003 2004 2005 $ Accounting depreciation for the year 1,630 1,590 1,530 Tax depreciation allowance for the year 2,120 1,860 1,320 At 31 December 2002, CY had the following balances brought forward: $ Cost of property, plant and equipment qualifying for tax depreciation 20,000 Accounting depreciation 5,000 Tax depreciation 12,500 CY had no non-current asset acquisitions or disposals during the period 2003 to 2005. Assume the corporate income tax rate is 25% for all years. Calculate the deferred tax provision required by IAS 12 Income Taxes at 31 December 2005
