Answered step by step
Verified Expert Solution
Question
1 Approved Answer
uantacc Ltd. began operations on January 1, 2011, and uses IFRS to prepare its consolidated financial statements. Although not required to do so, to facilitate
uantacc Ltd. began operations on January 1, 2011, and uses IFRS to prepare its consolidated financial statements. Although not required to do so, to facilitate comparisons with companies in the United States, Quantacc reconciles its net income and stockholders equity to U.S. GAAP. Information relevant for preparing this reconciliation is as follows: 1. Quantacc carries fixed assets at revalued amounts. Fixed assets were revalued upward on January 1, 2013, by $35,000. At that time, fixed assets had a remaining useful life of 10 years. 2. On January 1, 2012, Quantacc realized a gain on the sale and leaseback of an office building in the amount of $200,000. The lease is classified as an operating lease and has a term of 20 years. 3. Quantacc capitalized development costs related to a new pharmaceutical product in 2012 in the amount of $80,000. Quantacc began selling the new product on January 1, 2013, and expects the product to be marketable for a total of 5 years. Net income under IFRS in 2013 is $100,000 and stockholders equity under IFRS at December 31, 2013, is $1,000,000. Required a. Prepare a schedule to reconcile Quantaccs 2013 net income and December 31, 2013, stockholders equity under IFRS to U.S. GAAP. b. Provide a brief title/description for each reconciling adjustment made, indicate the dollar amount of the adjustment, and calculate total amounts for net income and stockholders equity under U.S. GAAP
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started