Foxcoon is a technological solution provider business with a year-end 31st March 2021.You have recently been appointed as a financial accountant, and the following issues are outstanding in the financial statements. Foxcoon has been in need of additional finance in the current year, and decided to factor some trade receivables. Trade receivables of £1 million were factored on 31 March 2021 for £800,000. The trade receivables balance of £1 million has been de-recognised, and the difference between this and the proceeds of £800,000 received from the factor has been debited to operating expenses. Foxcoon has to refund any sums relating to trade receivables that are uncollected by the factor after a period of six months. Explain the required IFRS/IAS accounting treatment of the above issues.
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- Mohammed LLC is a growing consulting firm. The following transactions take place during the current year. A. On June 10, Mohammed borrows $270,000 from a bank to cover the initial cost of expansion. Terms of the loan are payment due in four months from June 10, and annual interest rate of 5%. B. On July 9, Mohammed borrows an additional $100,000 with payment due in four months from July 9, and an annual interest rate of 12%. C. Mohammed pays their accounts in full on October 10 for the June 10 loan, and on November 9 for the July 9 loan. Record the journal entries to recognize the initial borrowings, and the two payments for Mohammed.Baker & Co. has applied for a loan from the Trust Us Bank in order to invest in several potential opportunities. In order to evaluate the firm as a potential debtor, the bank would like to compare Baker & Co. with the industry. Balance Sheet December 31 December 31 Income Statement For the year ended Dec 31, 2021 2020 2021 Assets Sales (100% credit) 1,330 Cash 305 270 Less: Cost of goods sold 760 Accounts receivable 275 290 Gross profit 570 Inventory 600 580 Operating expenses 30 Current assets 1,180 1,140 Depreciation 200 Plant and equipment 1,700 1,940 Net operating income 340 Less: acc depr -500 -600 Less: Interest expense 57 Net plant and equipment 1,200 1,340 Net income before taxes 283 Total assets 2,380 2,480 Less: Taxes 96 Net income 187 Liab. and Owners' Equity Accounts payable 150 200 Notes payable 125 - Current liabilities 275 200 Bonds payable 500 500…Wally has provided the information below – and asked you to create an Income Statement and Balance Sheet for AndrewCo for the year ended December 31, 2019. Sales were $1,200,000 Gross profit margin was 50% Operating margins were 10% The Bank of Toronto provided a loan on Jan 1, 2019 worth $300,000. The annual interest is 8% and is compounded annually. Interest only payments are needed – until the loan is due in 10 years, where a balloon payment for the full balance must be paid. The combined federal and provincial tax rates is 25% Wally knows that the ending cash balance in his company is 200,000. Accounts Receivables is 12% of sales Inventory is 15% of sales Accounts Payable is 5% of sales Accrued expenses payable is 5.5% of sales Capital equipment purchases were made at the start of the year. These total $50,000. These depreciate at 10% per year The owner will provide all other capital in the form of equity financing Wally has asked you to figure out his Selling General and…
- Corp. open up a business with an investment of P50,300 on November 1, 2022 from his saving account to a business checking account and made payment for a small space month-rent, P20,000 and merchandise for presentation worth P20,000. During the operating month, the business incurred various expenses, P7,500 of which 25% remains to be paid next month. Mr. Hamon made all sales deposits directly to the bank and paid wages during the month amounting to P55,000 and P15,000, respectively. At the end of the month, a total of P3,250 for the water, electric and phone consumption bills were received but did not immediately pay it. At this point, the balance of business checking account increased to P43,200.How much is the November 30 Owner’s Equity balance if Mr. Hamon was able to withdraw cash during for the purchase of merchandise for trading amounting to P15,000?On 30 April 2006, Pinto Products received a cash payment of $30,000 as a deposit on production of a custom machine to be delivered in August 2006. Th is transaction would most likely result in which of the following on 30 April 2006? C . An increase in liabilities of $30,000.Crunch Craft, a catering company, provides catering services to its customers. Customers normally pay for catering services after the service has been provided. In January 2022, Crunch Craft provided catering services worth $30,000 which it will receive in cash in February 2022. A senior accountant at Crunch Craft wants to record the $30,000 as an asset in the company’s Balance Sheet at the end of January 2022. Should the $30,000 be recorded as an asset in the company’s Balance Sheet at the end of January 2022? Explain, using the definition and recognition criteria of an asset in your explanation.
- Lyle Company is preparing financial statements for the year ended December 31,2021.Accounts payable amounted to P360,000 before any necessary year-end adjustment related to the following:On December 31, 2021, Lyle has a P50,000 debit balance in accounts payable to Reese, a supplier, resulting from a P50.000 advance payment for goods to be manufactured.Checks in the amount of P100,000 were written to vendors and recorded on December 20, 2021. The checks were mailed on January 5, 2022.Goods shipped FOB shipping point on December 20, 2021 were received and recorded by Lyle on January 2, 2022. The invoice cost was P45,000.What amount should be reported as accounts payable on December 31, 2021? a. 555,000b. 455,000C. 310,000d. 460,000On its second year, PAGTALUNAN, Inc. thought of expanding its business. In order to generate additional cash necessary for this expansion, the company on September 1, 2021, factored P200,000 of accounts receivable to OCANA. Factoring fee was 10% of the receivables purchased. OCANA Company withheld 5% of the purchase price as protection against sales returns and allowances. On November 2, 2021, accounts amounting to P500,000 was assigned to MONDALO Bank as a collateral on a P300,000, 20% annual interest rate loan. A 3% finance charge was deducted in advance. As of December 31, 2021, data relating to accounts receivable follows: Allowance for doubtful accounts – credit P6,700 Estimated uncollectible as a percentage of accounts receivables 2% Accounts receivable excluding factored and assigned accounts 95,000 Collections on assigned accounts None 31. What is the total cash generated by PAGTALUNAN Company from factoring and assigning the accounts receivable? 32. What…Last year, which is used as the base year, a firm had cash of P46, accounts receivable of P132, inventory of P319, and net fixed assets of P640. This year, the firm has cash of P52, accounts receivable of P147, inventory of P312, and net fixed assets of P576. What is the common-base year value of accounts receivable? a. 1.11 b. 0.90 c. 1.13 d. 0.88
- Here is the question Massa Company, which has been operating for three years, provides marketing consulting services worldwide for dot-com companies. You are a financial analyst assigned to report on the Massa management team’s effectiveness at managing its assets efficiently. At the start of 2019 (its fourth year), Massa's T-account balances were as follows. Dollars are in thousands. Transactions for 2019: Provided $59,700 in services to clients who paid $48,800 in cash and owed the rest on account. Received $5,800 cash from clients on account. Received $520 in cash as interest revenue on investments. Paid $36,000 in wages, $12,900 in travel, $6,800 in rent, and $1,300 on accounts payable. Received $1,200 in cash from clients in advance of services Massa will provide next year. Received a utility bill for $690 for 2019 services. Declared and immediately paid $370 in dividends to stockholders. The T-account balances were as follows. (see attached 1) Here is the question: Calculate…COULD YOU PROVIDE SOME MORE DETAIL WHEN PROVIDING THE ANSWER, THANK YOU Question 1A. Yaso plc is a manufacture company and its financial year ended at 31st December 2019. Total assets are £40m and net profit before tax is £12m. Yaso plc’s trade receivables ledger includes a large number of customers. The year-end trade receivables balance is £4m (comparable to £2m in 2018) and the allowance for trade receivables is £400,000 (comparable to £600,000 in 2018). PART A Requirement:• Describe substantive procedures the auditor should perform to obtain sufficient and appropriate audit evidence in relation to Yaso plc’s trade receivables. PART B. According to ISA 260, it is important for auditors to communicate throughout the audit with those charged with governance. PART B Requirement: • Explain why it is important for auditors to communicate with those chargedwith governance. • Identify three examples of matters which the auditor may communicate to those chargedwith governance.Bee Kay & Co has been appointed as an auditor of Syarikat Elektrik Fudu for the year ended 31 October 2020. During the year, Syarikat Elektrik Fudu obtained a long-term loan amounted RM35 millions from Glory Bank with the following financing agreement:1. The loan was secured by a fixed charge over two pieces of land and buildings of the company located in Alor Setar.2. Monthly installment rate of 5% started from 1 February 2020. The loan secured was used to expand the business. Syarikat Elektrik Fudu has increased the number of staff from 100 to 130 staff for the purpose of business expansion. During the planning process, Bee Kay & Co determined that the inherent risk of overstatement of payroll might be high as compared to prior financial year. (a) Explain THREE (3) procedures that Bee Kay should employ in examining the long-term loan from Glory Bank. (b) Describe TWO (2) audit procedures to be performed in the audit of payroll transactions in addressing the risk of…