FSP Examples - Solutions
FSP Examples - Solutions
FSP Examples - Solutions
Requirement (a)
Depreciation expense 19
Accumulated depreciation – Building ($100m*5%) 5
Accumulated depreciation – Plant & Machinery (140*10%) 14
To record depreciation expense for the year.
Other Receivables 31
Accumulated Depreciation – Plant and Machinery ($4m*1.5yrs) 6
Loss on disposal of plant and machinery 3
Plant and Machinery 40
To record the loss on disposal of the machine
Investment property 14
Other income – Increase in fair value of investment property 14
($350m - $336m)
To adjust Investment Property to fair value at year-end.
Interest Expense 16
Interest Payable 16
To record interest payable (200 * 8%)
Tax Expenses 12
Tax Payable 12
To record tax payable
1
Requirement (b)
Maxwell Limited
Statement of Profit or Loss and Other Comprehensive Income
for the year ended 31 December of Year 2
Notes $’m
Sales 450
Cost of goods sold (180)
Gross Profit 270
Other income 1 14
Administrative Expenses 2 (72)
Distribution Costs 3 (80)
Other Operating Expenses 4 (37)
Interest expense (16)
Profit Before Tax 79
Tax Expense (12)
Net profit for the year 67
Other comprehensive income -
Total comprehensive income for the year $ 67
Notes $m
Note 1: Other Income
Increase in fair value of Investment Property $14
2
Maxwell Limited
Statement of Changes in Equity for the year ended 31 December of Year 2
Maxwell Limited
Statement of Financial Position as at 31 December of Year 2
$’m $’m
NET ASSETS
Non-current assets
Investment property (at valuation) 350
Buildings
Cost 100
Accumulated Depreciation (25) 75
Plant and Machinery
Cost 100
Accumulated Depreciation (22+14-6) (30) 70
Total Non-Current Assets 495
Current assets
Inventories 130
Other Receivables 31
Accounts Receivable, net (120m – 12m) 108
Cash 40
309
Current liabilities
Accounts Payable (40)
Current portion of Loans (50)
Interest Payable (16)
Tax Payable (12)
Salaries Payable (37)
(155)
Net current assets 154
Total assets less current liabilities 649
Non-current liabilities
Loans (150)
Net Assets $499
EQUITY
Share Capital 400
Retained Earnings 99
Total Equity $499