Financial Accounting Cheat Sheet

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Chp 2: Questions from Appendix c: On August 1, Secret Sauce Technologies Inc. paid $12,600 for an insurance policy that is for two years and is effective August 1. Prepare two sets of journal entries for Secret Sauce, with each set of journal entries recording the August 1 journal entry and the December 31 adjusting entry. (a) Treat the expenditure as an asset in a first set of journal entries. (b) Treat the expenditure as an expense in a second set of journal entries. Ans:aug1- Dr prepaid insurance 12600,Cr cash 12600. dec31- Dr insurance expense 2625(525/month*5(aug-dec), Cr prepaid insurance 2625. b)aug1- debit insurance expense 12600,Cr cash 12600. dec31- Dr prepaid insurance 9975,Cr insurance expense 9975(525/month*19(left months)). On August 1, Secret Sauce Technologies Inc. paid $12,600 for an insurance policy that is for two years and is effective August 1. Prepare two sets of journal entries for Secret Sauce, with each set of journal entries recording the August 1 journal entry and the December 31 adjusting entry. (a) Treat the expenditure as an asset in a first set of journal entries. (b) Treat the expenditure as an expense in a second set of journal entries. Ans:Sep1- Dr Cash 12000,Cr. Unearned revenue 12000. dec31- Dr unearned revenue 8000,Cr. Service revenue 8000. b)sep1- Dr cash 12000,Cr service revenue 12000. dec31(whats left?)- Cr service revenue 4000, Dr Unearned revenue 4000. Staight-line Depreciation=((purchase price(cost) – salvage value) / useful life) * months used. Year-end closing entries(revenue,expense,div) ex: Tiger Inc. has the following year-end account balances: Sales Revenue $928,900; Interest Income $17,500; Cost of Goods Sold $406,200; Operating Expenses $129,000; Income Tax Expense $55,100; and Dividends $15,900. Prepare the year-end closing entries. Ans:to close revenue: Dr Sales revenue and Interest Income,Cr Income Summary. To close expense account: Dr income summary, Cr. COGS, Operating expense, income tax expense. to close income summary: Dr income summary(subtract revenue income summary from expenses income summary, Cr. Retained earnings. To close dividend account: Dr retained earnings, Cr. Dividends. For similar question: sales returns and allowanced, sales discounts are considered expense. Chp 4: Questions from Chp4: On January 1, 2023, Twist Corp. had cash and common shares of $60,000. At that date, the company had no other asset, liability, or shareholders’ equity balances. On January 2, 2023, Twist paid $40,000 cash for equity securities that it designated as FV-OCI investments. During the year, Twist received non-taxable cash dividends of $18,000 and had an unrealized holding gain of $25,000 (net of tax) on these securities. Determine the following amounts for 2023: (a) net income, (b) other comprehensive income, (c) comprehensive income, and (d) accumulated other comprehensive income (as at the end of 2023). Ans: NI=Div revenue (18000), OCI=Gains (25000), Comprehensive income=NI+OCI (43000), AOCI=beg bal.+OCI (0+25000). Q2: Delray Inc. follows IFRS and has the following amounts for the year ended December 31, 2023: gain on disposal of FV-NI investments (before tax), $15,000; loss from operation of discontinued division (net of tax), $42,000; income from operations (before tax), $220,000; unrealized holding gain-OCI (net of tax), $12,000; income tax on income from continuing operations, $63,000; loss on disposal of discontinued division (net of tax), $75,000. The unrealized holding gain-OCI relates to investments that are not quoted in an active market. (a) Calculate income from continuing operations. (b) Calculate net income. (c) Calculate other comprehensive income. (d) Calculate comprehensive income? Ans:a) income from operations + gain on disposal of FV-NI investments – income tax on income from continuing operations (172000). b) income from continuing operations – loss from operation of discontinued division (net of tax) – loss on disposal of discontinued division (net of tax) (55000). c) unrealized holding gain – OCI (net of tax) (12000). d) NI + OCI (67000). Q3: The Blue Collar Corporation had income from continuing operations of $12.6 million in 2023. During 2023, it disposed of its restaurant division at a loss of $89,000 (net of tax of $38,000). Before the disposal, the division operated at a loss of $315,000 (net of tax of $135,000) in 2023. Blue Collar also had an unrealized gain-OCI of $43,000 (net of tax of $18,000) related to its FV-OCI equity investments. Blue Collar had 10 million common shares outstanding during 2023. Prepare a partial statement of financial performance for Blue Collar, beginning with income from continuing operations. Include calculation and disclosure of EPS. Q4: Parfait Limited reported the following for 2023: sales revenue, $900,000; cost of sales, $750,000; operating expenses, $100,000; and unrealized gain on FV-OCI investments, $60,000. The company had January 1,2023 balances as follows: common shares, $600,000; accumulated other comprehensive income, $250,000; and retained earnings, $900,000. The company did not issue any shares during 2023. On December 15, 2023, the board of directors declared a $300,000 dividend payable on January 31, 2024. Prepare a statement of changes in equity. Ignore income tax. Q5: Global Corporation prepares financial statements in accordance with ASPE. At January 1, 2023, the company had retained earnings of $1,038,000. In 2023, net income was $335,000, and cash dividends of $70,000 were declared and paid. Prepare a 2023 statement of retained earnings for Global. Q6: Reach Out Card Company Limited reported the following for 2023: sales revenue, $1.2 million; cost of goods sold, $750,000; selling and administrative expenses, $320,000; gain on disposal of building, $250,000; and unrealized gain-OCI (related to FV-OCI equity investments with gains/losses not recycled), $18,000.Prepare a statement of comprehensive income. Ignore income tax and EPS. Assume investments are accounted for as FV- OCI equity investments, with gains/losses not recycled through net income. Q7: Assume that Elrond Inc. decided to sell DemandTV Ltd., a subsidiary, on September 30, 2023. There is a formal plan to dispose of the business component, and the sale qualifies for discontinued operations treatment. Pertinent data on the operations of the TV subsidiary are as follows: loss from operations from beginning of year to September 30, $1.9 million (net of tax of $700,000); loss from operations from September 30 to end of 2023, $700,000 (net of tax of $250,000); estimated loss on disposal of net assets to December 31, 2023 (net of tax of $50,000), $150,000. The year end is December 31. Elrond prepares financial statements in accordance with IFRS.a)What is the income/loss from discontinued operations reported in 2023?b)Prepare the discontinued operations section of the income statement for the year ended 2023.c)If the amount reported in 2023 as a gain or loss on disposal of the subsidiary becomes materially different from the amount arrived at in 2024, when and how is this difference reported, if at all?d)How would the discontinued operation be presented on the statement of financial position?e)How would your answer to part (d) be different if Elrond prepared financial statements in accordance with ASPE? Q8: The following information was taken from the records of Biscay Inc. for the year 2023:Gain from expropriation$300,000 Cash dividends declared$220,000 Loss from operation of discontinued Rochelle Division240,000 Retained earnings, January 1, 2023.1,900,000 Administrative expenses750,000 Cost of goods sold2,680,000 Rent revenue130,000 Selling expenses950,000 Loss from flood damage190,000 Sales revenue6,000,000. The following additional information was also available: income tax applicable to income from continuing operations, $465,000; income tax recovery applicable to loss from operation of discontinued Rochelle Division, $60,000.The company has elected to adopt ASPE.Prepare a single-step income statement for 2023, showing expenses by function.Prepare a combined single-step income and retained earnings statement. Q9: The following is information for Gottlieb Corp. for the year ended December 31, 2023:Sales revenue$1,300,000 Loss on inventory due to decline in net realizable value$80,000 Unrealized gain on FV-OCI equity investments42,000 Loss on disposal of equipment35,000 Interest income7,000 Depreciation expense related to buildings omitted by mistake in 2022.55,000 Cost of goods sold780,000 Selling expenses65,000 Retained earnings at December 31, 2022.980,000 Administrative expenses48,000 Loss from expropriation of land60,000 Dividend revenue20,000 Dividends declared45,000.The effective tax rate is 25% on all items. Gottlieb prepares financial statements in accordance with IFRS. The FV-OCI equity investments trade on the stock exchange. Gains/losses on FV-OCI investments are not recycled through net income. a) Prepare a multiple-step statement of financial performance for 2023, showing expenses by function. Ignore calculation of EPS. b) Prepare the retained earnings section of the statement of changes in equity for 2023. c) Prepare the journal entry to record the depreciation expense omitted by mistake in 2022 .d) How should Gottlieb account for the unrealized gain on FV-OCI investments if it prepares financial statements in accordance with ASPE? How would Gottlieb’s retained earnings balance at December 31, 2022, be different if financial statements in all previous years had been prepared in accordance with ASPE? Q10: Two accountants, Yuan Tsui and Sergio Aragon, are arguing about the merits of presenting an income statement in the multiple-step versus the single-step format. The discussion involves the following 2023 information for P. Bride Company (in thousands):Officers’ salaries$4,900 Delivery$2,690 Depreciation of office furniture and equipment3,960 Sales commissions7,980 Depreciation of sales equipment6,480 Cost of goods sold60,570 Sales revenue96,500 Rental revenue17,230 Interest expense 1,860 Common shares outstanding for 2023 total 30,550. Income tax for the year was $9,070.Prepare an income statement for the year ended December 31, 2023, using the multiple-step format. Include calculation of EPS.Prepare an income statement for the year ended December 31, 2023, using the single-step format. Include calculation of EPS. Q11: The following balances were taken from the books of Quality Fabrication Limited on December 31, 2023:Interest income$70,000 Accumulated depreciation—equipment$32,000 Cash40,000 Accumulated depreciation—buildings23,000 Sales revenue1,120,000 Notes receivable125,000 Accounts receivable122,000 Selling expenses160,000 Prepaid insurance16,000 Accounts payable140,000 Sales returns and allowances118,000 Bonds payable81,000 Allowance for doubtful accounts6,000 Administrative expenses80,000 Sales discounts40,000 Unearned revenue16,000 Land80,000 Interest expense50,000 Equipment160,000 Notes payable80,000 Buildings115,000 Loss from storm damage 124,000 Cost of goods sold504,000 Depreciation expense50,000.Assume the total effective tax rate on all items is 25%.Prepare a multiple-step income statement showing expenses by function. Assume that 150,000 common shares were outstanding during the year. Quality Fabrication follows ASPE but decides to disclose EPS on its income statement. Q12: Zambrano Corporation, a private company, began operations on January 1, 2020. During its first three years of operations, Zambrano reported net income and declared dividends as follows: Net income(2020(40000),2021(125000),2022(160000)). Div. declared(2020(0),2021(50000),2022(50000)).The following information is for 2023:Income before income tax$240,000 Correction of prior period error: understatement of 2021 depreciation expense (before tax)25,000 Cumulative increase in prior years’ income from change in inventory method (before tax)35,000 Dividends declared (of this amount, $25,000 will be paid on January 15, 2024)100,000 Effective tax rate40% Prepare a 2023 statement of retained earnings for Zambrano. The company follows ASPE. Q13: Rainy Day Umbrella Corporation had the following balances at December 31, 2022 (all amounts in thousands): preferred shares, $3,375; common shares, $8,903; contributed surplus, $3,744; retained earnings, $23,040; and accumulated other comprehensive income, $2,568.During the year ended December 31, 2023, the company earned net income of $7,320,000, generated an unrealized holding gain on FV-OCI investments of $585,000, sold common shares of $285,000, and paid out dividends of $30,000 to preferred shareholders and $20,000 to common shareholders. Prepare a statement of changes in equity for the year ended December 31, 2023.Prepare the shareholders’ equity section of the Rainy-Day Umbrella statement of financial position as at December 31, 2023. Gains/losses on FV-OCI investments are not recycled through net income. Q14: Retained earnings, January 1, 2023$1,980,000 Sales revenue36,500,000 Cost of goods sold28,500,000 Interest income170,000 Selling and administrative expenses4,700,000 Unrealized gain on FV-OCI equity investments (gains/losses not recycled)320,000 Loss on impairment of goodwill520,000 Income tax on continuing operations for 2023

(assume this is correct)797,500 Assessment for additional income tax for 2021 (normal, recurring, and not caused by an error)500,000 Gain on disposal of FV-NI investments110,000 Loss from flood damage390,000 Loss on disposal of discontinued division (net of tax of $87,500)262,500 Loss from operation of discontinued division (net of tax of $55,000)165,000 Dividends declared on common shares250,000 Dividends declared on preferred shares70,000. Rolling Thunder decided to discontinue its entire wholesale division (a major line of business) and to keep its manufacturing division. On September 15, it sold the wholesale division to Dylane Corp. During 2023, there were 800,000 common shares outstanding all year. Rolling Thunder’s tax rate is 25% on operating income and all gains and losses (use this rate where the tax provisions are not given). Rolling Thunder prepares financial statements in accordance with IFRS.Prepare a multiple-step statement of financial performance for the year ended December 31, 2023, showing expenses by function. Include calculation of EPS. Chp5 Questions for Chp5: Newvo Ltd. shows a patent on its statement of financial position. At its year end of October 31, 2022, the caption read Patent (net) $66,000, and at its year end of October 31, 2023, the caption read Patent (net) $40,000. Newvo’s recorded amortization on the patent in the amount of $6,000 for the 2023 fiscal year and the remaining change in the account resulted from recording a loss on impairment for the year ended October 31, 2023. There were no purchases or sales of patents during the year. Determine the necessary caption(s) and amount(s) that should appear on Newvo’s statement of cash flows, using the indirect method. Indicate where the item(s) would appear on the statement (the operating, investing, or financing section(s). Q15: Healey Corporation’s statement of financial position as at December 31, 2023, showed the following amounts: Cash $100; Accounts Receivable $600; Land $1,000; Accounts Payable $300; Bonds Payable $500; Common Shares $400; and Retained Earnings $500. Healey’s statement of financial position as at December 31, 2022, showed the following amounts: Cash $150; Accounts Receivable $450; Land $800; Accounts Payable $700; Common Shares $400; and Retained Earnings $300. Assume that no dividends were declared or paid in 2023. Calculate the net cash provided (used) by operating activities for the year ended December 31, 2023, using the indirect method. Q16: Ames Company reported 2023 net income of $151,000. During 2023, accounts receivable increased by $15,000 and accounts payable increased by $9,000. Depreciation expense was $44,000. Prepare the cash flows from operating activities section of the statement of cash flows using the indirect method. Q17: Miller Ltd. engaged in the following cash transactions during 2023:Proceeds from sale of land and building$176,000 Repurchase of company’s own shares 25,000 Purchase of land44,000 Payment of cash dividends58,000 Purchase of equipment35,000 Issuance of common shares140,000 Retirement of bonds payable 200,000. Miller prepares financial statements in accordance with ASPE. Calculate the net cash provided (used) by investing activities. Q18: Indicate by number how each of the following should usually be classified. If an item need not be reported at all on the statement of financial position, use the letter X. Also indicate whether an item is monetary and/or represents a financial instrument. Q19: Prepare a revised statement of financial position using the available information. Assume that the bank overdraft relates to a bank account held at a different bank from the account with the cash balance. Assume that the accumulated depreciation balance for the buildings is $160,000 and that the accumulated depreciation balance for the equipment is $105,000. The allowance for expected credit losses has a balance of $17,000. The pension obligation is considered a long term liability. ‐ Q20: Prepare a classified statement of financial position in good form (no monetary amounts are necessary). Q21: (Zhang LTD.) Prepare a classified statement of financial position in good form (no monetary amounts are necessary). Q22: Prepare a statement of cash flows using the indirect method along with any necessary note disclosure. Q23: (IFRS) Prepare the operating activities section of the statement of cash flows for the year ended December 31, 2023:using the indirect method. Q24: (IFRS) Prepare the statement of cash flows for Dropafix for the year ended June 30, 2023, using the indirect method along with any necessary note disclosure. From the perspective of a creditor holding several of the long term notes in substantial amounts owed by Dropafix, how do you view the cash management demonstrated by ‐ Dropafix? Q25: From the perspective of a creditor holding several of the long term notes in substantial amounts owed by Dropafix, how do you view the cash management demonstrated by ‐ Dropafix? Q26 ( ASPE) Prepare a statement of cash flows using the indirect method for cash flows from operating activities. Assume that Sensify prepares financial statements in accordance with ASPE. Chp6 Questions for chp6 On May 10, 2023, Cosmo Co. enters into a contract to deliver a product to Greig Inc. on June 15, 2023. Greig agrees to pay the full price of $2,000 on July 15, 2023. The cost of goods is $1,300. Cosmo delivers the product to Greig on June 15, 2023, and receives payment on July 15, 2023. Prepare the journal entries for Cosmo related to this contract . Q27: Talarczyk Company sold 10,000 heavy-duty spreaders on July 1, 2023, at a total price of $1 million, with a warranty guarantee that the product was free of any defects. The cost of the spreaders sold is $550,000. The assurance warranties extend for a two-year period and are estimated to cost $40,000. Talarczyk also sold extended warranties (service-type warranties) related to 2,000 spreaders for two years beyond the two-year period for $12,000. Prepare the journal entries that Talarczyk should make in 2023 related to the sale and the related warranties. Q28: On July 10, 2023, Amodt Ltd. sold GPS systems to retailers on account for a selling price of $700,000 (cost $560,000). Amodt grants the right to return systems that do not sell in three months following delivery. Past experience indicates that the normal return rate is 15%. By October 11, 2023, following the collection on account, retailers returned systems to Amodt and were granted credits of $78,000. Prepare Amodt’s journal entries to record (a) the sale on July 10, 2023, including any expected returns, and (b) the $78,000 of actual returns on October 10, 2023. The company follows ( IFRS). Q29: Same question as before but under ASPE Q30: Kristin Company sells 300 units of its products for $20 each to Logan Inc. for cash. Kristin allows Logan to return any unused product within 30 days and receive a full refund. The cost of each product is $12. To determine the transaction price, Kristin decides that the approach that is most predictive of the amount of consideration to which it will be entitled is the probability- weighted amount. Using the probability-weighted amount, Kristin estimates that (1) 10 products will be returned, and (2) the returned products are expected to be resold at a profit. Prepare the journal entries for Kristin at the time of the sale to Logan including any expected returns. The company follows ( IFRS). Q31: Manual Company sells goods on account to Nolan Company during 2023. It offers Nolan the following rebates based on total sales to Nolan. If total sales to Nolan are 10,000 units, it will grant a rebate of 2%. If it sells up to 20,000 units, it will grant a rebate of 4%. It if sells up to 30,000 units, it will grant a rebate of 6%. In the first quarter of the year, Manual sells 11,000 units to Nolan at a sales price of $110,000. Based on experience, Manual has sold over 40,000 units to Nolan, and these sales normally take place in the third quarter of the year. Prepare the journal entries including any rebates that Manual should make to record the sale of the 11,000 units in the first quarter of the year assuming (a) Manual follows IFRS and (b) Manual follows ASPE . Ignore any cost of goods sold entry. Q32: During February 2023, Master Massage Ltd. sells $10,000 of gift cards for Valentine’s Day gifts. From reliable experience, management estimates that 10% of the gift cards sold will not be redeemed. By the end of February, $4,000 was redeemed by customers. Prepare the journal entries for Master Massage for February 2023. Round to the nearest dollar Q33: Turner Inc. began work on a $7-million non-cancellable contract in 2023 to construct an office building. During 2023, Turner incurred costs of $1.7 million, billed its customers for $1.2 million (non-refundable), and collected $960,000. At December 31, 2023, the estimated future costs to complete the project totalled $3.3 million. Prepare Turner’s 2023 journal entries using the percentage-of-completion method. Q34: Best Lawn Care Inc. (BLC) offers its customers two lawn maintenance services. One service is for a one-year maintenance plan at a cost of $200. Customers can earn a 5% discount from this price if they pay before BLC’s calendar fiscal year for maintenance services to be performed in the following year. The second service offered by BLC is a three-year maintenance plan that sells for $500. The first year’s maintenance service for this three-year plan will be delivered before BLC’s fiscal year end. No discount for early payment is offered for the second plan.Prepare the summary journal entry for the cash sale of 200 one-time plans for the current year, 100 discounted one-time plans for the following year, and 300 three-year maintenance plans.Determine the statement of financial position classification of the unearned portion of the revenue collected. Q35: To increase sales, Letourneau Inc., a public company following IFRS, implemented a customer loyalty program that rewards a customer with one loyalty point for every $30 of merchandise purchased. Each point is redeemable for a $2.50 discount on any purchases of Letourneau merchandise in the next three years. After the program launched, during 2023, customers bought merchandise for $300,000 (all products are sold to provide a 35% gross profit) and earned 10,000 points redeemable for future purchases. The stand-alone selling price of the merchandise sold is $300,000. Based on prior experience with incentive programs like this, Letourneau expects 7,500 points to be redeemed related to these sales.Identify the separate performance obligation in the Letourneau bonus point program, and briefly explain the point in time when the performance obligations are satisfied. Round percentage allocations to two decimal places and final amounts to the nearest dollar.Prepare the journal entries for cash sales including the issuance of loyalty points for Letourneau in 2023.Would the accounting of the customer loyalty program be different if Letourneau had been following ASPE ? Q36: On December 31, 2023, Grando Company sells production equipment to Fargo Inc. for $50,000. Grando includes a one-year assurance warranty service with the sale of all its equipment. The customer receives and pays for the equipment on December 31, 2023. Grando estimates the prices to be $48,800 for the equipment and $1,200 for the cost of warranty.Are the sale of the equipment and the warranty separate performance obligations within the contract? Explain.Prepare a single compound journal entry to record this transaction on December 31, 2023. Ignore any related cost of goods sold entry.Repeat the requirements for part (b), assuming that, in addition to the assurance warranty, Grando sold an extended warranty (service- type warranty) for an additional two years (2025–2026) for $800. (Hint: Use unearned revenue). Q37: Celic Inc. manufactures and sells computers that include an assurance-type warranty for 90 days. Celic offers an optional extended coverage plan under which it will repair or replace any defective part for three years from the expiration of the assurance-type warranty. Because the optional extended coverage plan is sold separately, Celic determines that the three years of the extended coverage represent a separate performance obligation. The total transaction price for the sale of a computer and the extended warranty is $3,600 on October 1, 2023. Celic determines that the stand-alone selling price of each is $3,200 and $400, respectively. Further, Celic estimates, based on historical experience, that it will incur $200 in costs to repair defects that arise within the 90-day coverage period for the assurance-type warranty. The cost of the equipment is $1,440. Are the computer and warranties distinct within the contract? Explain.Prepare the journal entry (or entries) to record the cash sale of the computer, cost of goods sold, and liabilities related to the warranties.Briefly describe the accounting for the service-type warranty after the 90-day assurance-type warranty period Q3 Blue Collar Corporation Q4 Statement of change in equity

Partial statement of financial performance Common Shares Retained Earnings. AOCI Total For the year ended Dec 31, 2023 Beginning Balance 600000 900000 250000 1750000 Comprehensive Income Income from continuing operations 12600000 Net income for the year 50000 50000 Discontinued Operation OCI for the year 60000 60000 Loss before disposal 315000 Dividends (300000) (300000) Disposed restaurants 89000 404000 Total comprehensive income. 600000 650000 310000 1560000 Net Income 12196000 OCI Unrealized gain on FV-OCI(N.O.T 18K) 43000 Q5 Statement of retained earnings Comprehensive Income 12239000 . Beg retained earnings Jan 1 1038000 Add Net Income 335000 EPS 1373000 Income from continuing operations 1.26 Less Dividends (70000 ) 7b) Income statement section of discontinu operation Discontinued operations (404000/10M) 0.04 Ending retained earnings Dec 31 1303000 Discontinued operations (2023) Net Income $1.22 Loss from operation of discontinued Subsidiary, N.O.T $950000 2600000 Q7a) Loss on impairment of net assets Q6 Reach Out Card Company Limited 2023: N.O.T $50000 150000 Statement of Comprehensive Income Loss Jan. 1 to Sept 30(N.O.T $700000) $1900000 Loss from discontinued operations 2750000 For the Year Ended December 31, 2023 Loss Sept 30 to Dec 31(N.O.T $250000) 700000 Sales Revenue $1200000 Estimated impairment loss on net assets Cost of goods sold 750000 (N.O.T $50000) 150000 Gross profit 450000 Total loss from discontinued operations 2750000 Operating expenses Selling and administrative expenses 320000 Q7c) Income from operations 130000 Gain on disposal of building 250000 Net Income 380000 Other comprehensive income Items that will not be recycled subsequently to net income or loss: Unrealized gain on FV-OCI investments 18000 Comprehensive income 398000 Net Income = Sales Revenue – Cost of Sales – operating expenses…..OCI = unrealized gain EPS = (NI-Preferred Shared Div)/WACC of Shares Outstanding Q7d) Under IFRS, all assets and liabilities related to the discontinued subsidiary should be presented as held for sale, and classified as current assets and current liabilities, respectively. Q7e) Under ASPE, the solution to parts a. through c. would remain the same, except that earnings per share calculations are not required under ASPE. On the Statement of Financial Position, the assets and liabilities relating to the discontinued subsidiary should be segregated according to their nature (e.g. current assets related to the discontinued subsidiary should be presented as current assets held for sale/related to discontinued operations, and noncurrent assets related to the discontinued subsidiary should be presented as noncurrent assets held for sale/related to discontinued operations). Q7c) The difference between the actual selling price and the amount used to calculate the gain or loss on disposal of the subsidiary at December 31, 2023 is reported in 2024 in the discontinued operations section of the income statement, net of tax and with separate EPS disclosure, supported by an explanation in a note to the financial statements. The correction is treated as a change in estimate.

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