zhFU$251$ Case study

The company Ski$4$kids produces children's skis. Skis are ordered via e$-$shop and delivered to end customers by courier. The

company does not incur any receivables from this business, everyone pays on delivery or even in advance.

The company uses a classification of expenses by function and is divided into $3$ divisions within the company structure:

Production, Administration and Distribution $($Selling$).$

From $1$ tonne of plastic, $100$ pcs of ski sets are produced using a $3$D printer. Before finishing, each ski set $(1$ pair of skis$)$ is

treated with a protective varnish. $0\mathrm{.}1Kg$ of varnish is used for each ski set.

The company owns the following types of non$-$current assets as of $1$ January $2020$:

Internal regulations on non$-$current assets:

Non$-$current assets are depreciated from the month following the month when they were put in use.

The building is depreciated over its estimated useful life using straight$-$line depreciation method. The $3$D printer and the

personal car are depreciated using units$-$of$-$activity method. The estimated total capacity of the $3$D printer is $15000$ ski sets

$($as of $31$ December $2019,$ the $3$D printer has produced $5000$ ski sets$).$ The personal car has driven $14000$ kilometres in

The estimated total capacity of car is $120000km.$

Other internal regulations:

The company's accounting period is the calendar year.

The company uses a classification of expenses by function.

The FIFO method is used for the valuation of finished goods and inventory of materials for production.

As of $1$ January $2020,$ the company reports the following account balances $($in CZK$)$ in addition to the information provided

above:

Share capital: CZK $23000000$

Retained earnings: CZK $4515000$

Material: CZK $500000(21$ t of plastic$)$

Advance provided to the supplier of varnish: CZK $600000$

Current account: CZK $4000000$