Accounting at Maccloud Winery

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GSM 5301 Accounting for Decision Making ACCOUNTING AT MACCLOUD WINERY Syed Mohd Muhsin Sy Mohamad Mohd Khalis Mohd Asrar Norhelena Mansor Mohd Hezreey Onn Keywords to be used: A=Asset L=Liability OE=Owners’ Equity R=Revenue E=Expenses SOCI=Statement of Comprehensive Income SOFP=Statement of Financial Position PPE= Property, Plant & Equipment NBV = Net Book Value Should the leased building be accounted for as an asset? No, leased building should be accounted for as an expenses (cost of sales) Why? Because: i) The lease contract signed was not mention on purchase bargain ii) Mike might not assume ownership of the building iii) The lease would be considered an operating lease (business expense) – expenses would be accrued…show more content…
 To provide allowance for losses on Pierce Disease  The allowance is in SOFP under liability A = Allowance for losses – expenses  To be used in the future to cover for future costs

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