Analyse the issue(s)/problem(s) faced by SSB by referring to the MFRS 137 Provisions, Contingent Liabilities and Contingent Assets (CTPS Question –Problem analysis)
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Analyse the issue(s)/problem(s) faced by SSB by referring to the MFRS 137 Provisions,
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- Sapling Ltd is an entity that operates a various nurseries and gardening centres around thecountry.The following is the trial balance of the Sapling Ltd for the year ended 28 February 2022:Account Name Debit CreditInventory 75 000Trade receivables 36 000Revenue 1 600 000Cost of sales 750 000Property, plant and equipment 650 000Telephone expense 12 000Revaluation surplus 10 000Salaries and wages 350 000Trade payables 120 000Retained earnings - 1 March 2021 28 000Share capital 100 000Advertising expenses 25 000Depreciation 85 000Loan 98 000Bank 10 000Dividends paid 15 000Finance income 32 000Total 1 998 000 1 998 000Additional information:• The outstanding loan is payable over the next three years in the following ratio 30: 20: 50.• Inventory with a cost price of R20 000 (Selling price of R25 000) was returned by a debtor.No entry for the return of the inventory has been recorded.• 10 000 shares were issued on 28 February 2022 at R5 each for cash. This transaction has notyet been…Ejura Ltd (Ejura) is a Manufacturing and retail company which prepares financial statements in accordance with International Financial Reporting Standards (IFRS) up to 31 December each year. In order to generate or improve sales on one of its older products, Ejura offered a promotion named ‘something for free’. The promotion included free maintenance services for the first two years. On 1 October 2019, under the promotional offer, Ejura sold goods to a supermarket chain for GH¢4.4 million. A two-year maintenance contract would normally be sold for GH¢0.5 million, and the list price of the product would normally be GH¢5 million. The transaction has been included in revenue at GH¢4.4 million. Required: In accordance with IFRS 15: Revenue from Contracts with Customers, justify the appropriate accounting treatment for the above transaction in the financial statements of Ejura for the year ended 31 December 201Tidy & Cleaning Services provides cleaning and housekeeping services to both households and businesses. The entity prepares financial statements at the end of each month. The following information is provided in relation to the business’s operations in the month of July 2021. On 1 July 2021, the business signed an advertising agreement, that costs $10,800 for six (6) months plus $1 per each click on their advertisements, with an online website to promote its business for the next six months. The agreement stated $1,800 per month will need to be paid in advance at the beginning of each month, $1 per each click on their ads will be paid at the end of the 6th month agreement. A $1,800 advance was paid on 1 July. On 2 July, rent of $39,000 is paid for a 6-months period from 1 July to 31 December 2021. Cleaning supplies account had a debit balance of $750 at the beginning of the month. On 10 July, the business purchased $5,900 cleanings supplies. At the end of the month, a physical…
- Burda Alatau Press is a publishing house based in Kazakhstan which is selling 28 different magazines on Kazakhstani market of which 24 are purchased directly from its immediate parent company Burda Russia based in Russian Federation. Some clients pay subscription fees in advance for the magazines, others are billed after magazines have been delivered. Advance payments are credited to an account entitled Unearned Subscription Fees. Adjusting entries are performed on a monthly basis. An unadjusted trial balance dated December 31, 2015, follows. (Bear in mind that adjusting entries have already been made for the first 11 months of 2015, but not for December.) Other Data Accrued but unrecorded subscription fees earned at December 31 amount to $9,400. Records show that $7,500 of cash receipts originally recorded as Unearned Subscription Fees had been earned as of December 31. Office supplies on hand at December 31 amount to $320. The company purchased all of its office equipment when it…. Ortel Telecom sells telecommunication products and services to a variety of small businesses. Two of Ortel’s key clients are Square and Cloudburst, both fast-growing technology start-ups located in New York City. Ortel has compiled information regarding its transactions with Square and Cloudburst for 2017, as well as its expectations regarding their interactions over the next 3 years: (in pic) Ortel’s transactions with Square and Cloudburst are in cash. Assume that they occur at year-end. Ortel is headquartered in the Cayman Islands and pays no income taxes. The owners of Ortel insist on a required rate of return of 12%. Q. Based on the net present value from cash flows over the next 3 years, is Cloudburst or Square a more valuable customer for Ortel?. Ortel Telecom sells telecommunication products and services to a variety of small businesses. Two of Ortel’s key clients are Square and Cloudburst, both fast-growing technology start-ups located in New York City. Ortel has compiled information regarding its transactions with Square and Cloudburst for 2017, as well as its expectations regarding their interactions over the next 3 years: (in pic) Ortel’s transactions with Square and Cloudburst are in cash. Assume that they occur at year-end. Ortel is headquartered in the Cayman Islands and pays no income taxes. The owners of Ortel insist on a required rate of return of 12%. Q. What is the expected net cash flow from Square and Cloudburst for the next 3 years
- . Ortel Telecom sells telecommunication products and services to a variety of small businesses. Two of Ortel’s key clients are Square and Cloudburst, both fast-growing technology start-ups located in New York City. Ortel has compiled information regarding its transactions with Square and Cloudburst for 2017, as well as its expectations regarding their interactions over the next 3 years: (in pic) Ortel’s transactions with Square and Cloudburst are in cash. Assume that they occur at year-end. Ortel is headquartered in the Cayman Islands and pays no income taxes. The owners of Ortel insist on a required rate of return of 12%. Q. Cloudburst threatens to switch to another supplier unless Ortel gives a 10% price reduction on all sales starting in 2018. Calculate the 3-year NPV of Cloudburst after incorporating the 10% discount. Should Ortel continue to transact with Cloudburst? What other factors should it consider before making its final decision?The Following are the accounts of Regina Merchandising for December 31,2019: Sales ₱2,500,000 Salaries Expense 50,000 Supplies Expenses 75,000 Depreciation Expense 60,000 Utilities Expense 40,000 Insurance Expense 20,000 Rent Expense 90,000 Beginning Inventory 50,000 Purhases 1,500,000 Ending Inventory 100,000 Sales Discount 5,000 You were employed by the entity as its bookkeeper in its first year of operations. You are now to prepare the necessary financial statements for the current year. Accordingly, 15% of rent, depreciation and utility expenses pertain to the sales office while the rest pertains to the corporate office. Instructions: 1. How much is the net sales for the year? 2. How much is the cost of sales for the year? 3. How much is the gross…The Following are the accounts of Regina Merchandising for December 31,2019: Sales ₱2,500,000 Salaries Expense 50,000 Supplies Expenses 75,000 Depreciation Expense 60,000 Utilities Expense 40,000 Insurance Expense 20,000 Rent Expense 90,000 Beginning Inventory 50,000 Purhases 1,500,000 Ending Inventory 100,000 Sales Discount 5,000 You were employed by the entity as its bookkeeper in its first year of operations. You are now to prepare the necessary financial statements for the current year. Accordingly, 15% of rent, depreciation and utility expenses pertain to the sales office while the rest pertains to the corporate office. Instructions: 1. How much is the net sales for the year? 2. How much is the cost of sales for the year? 3. How much is the gross profit of the year? The Following are the accounts of Regina Merchandising for December 31,2019: Sales ₱2,500,000 Salaries Expense 50,000 Supplies Expenses 75,000 Depreciation Expense 60,000 Utilities Expense 40,000 Insurance Expense…
- Pastina Company sells various types of pasta to grocery chains as private label brands. The company's reporting year-end is December 31. The unadjusted trial balance as of December 31, 2024, appears below. Account Title Debits Credits Cash $ 32,600 Accounts receivable 41,000 Supplies 2,000 Inventory 61,000 Notes receivable 21,000 Interest receivable 0 Prepaid rent 1,400 Prepaid insurance 7,000 Office equipment 84,000 Accumulated depreciation $ 31,500 Accounts payable 32,000 Salaries payable 0 Notes payable 51,000 Interest payable 0 Deferred sales revenue 2,500 Common stock 67,000 Retained earnings 31,000 Dividends 5,000 Sales revenue 151,000 Interest revenue 0 Cost of goods sold 75,000 Salaries expense 19,400 Rent expense 11,500 Depreciation expense 0 Interest expense 0 Supplies expense 1,600 Insurance expense 0 Advertising expense 3,500 Totals $ 366,000 $ 366,000…Pastina Company sells various types of pasta to grocery chains as private label brands. The company's reporting year-end is December 31. The unadjusted trial balance as of December 31, 2024, appears below. Account Title Debits Credits Cash $ 32,600 Accounts receivable 41,000 Supplies 2,000 Inventory 61,000 Notes receivable 21,000 Interest receivable 0 Prepaid rent 1,400 Prepaid insurance 7,000 Office equipment 84,000 Accumulated depreciation $ 31,500 Accounts payable 32,000 Salaries payable 0 Notes payable 51,000 Interest payable 0 Deferred sales revenue 2,500 Common stock 67,000 Retained earnings 31,000 Dividends 5,000 Sales revenue 151,000 Interest revenue 0 Cost of goods sold 75,000 Salaries expense 19,400 Rent expense 11,500 Depreciation expense 0 Interest expense 0 Supplies expense 1,600 Insurance expense 0 Advertising expense 3,500 Totals $ 366,000 $ 366,000…Burda Alatau Press (the Company) is a publishing house based in Kazakhstan which is selling 28 different magazines on Kazakhstani market of which 24 are purchased directly from its immediate parent company Burda Russia based in Russian Federation. Some clients pay subscription fees in advance for the magazines, others are billed after magazines have been delivered. Adjusting entries are performed on a monthly basis. An unadjusted trial balance dated December 31, 2015, follows. (Bear in mind that adjusting entries have already been made for the first 11 months of 2015, but not for December.) Other Data December 1 The Company issued 46,500 shares of capital stock in exchange for $46,500 cash. December 2 Purchased additional printing facilities (Office equipment) for $18,750. Made a $3000 cash down payment and issued a note payable for the remaining balance.. December 4 The Company purchased office supplies costing $2100 on account December 15 Billed customers $14,300 for the…