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8.1 Company A pay VAT by the tax deduction method, on December of year N have the situation of fixed assets as follows: (Unit: 1,000 VND). Given that all payments are made by cash in bank 1. Purchased a machine for 70.000 which is used at the factory. In addition to the purchase price, company A made the following expenditures: freight, 3.000; installation, 6.000; testing, 4.000. It is sponsored by the Developing investment funds. 2. Purchased land and a warehouse for 1.200.000. In addition to the purchase price, company A made the following expenditures: broker's commission, 12.000; transferred tax, 6.000. An independent appraisal estimates the fair value of the land and warehouse at 840.000 and 560.000, respectively. 3. Sold an equipment for 6.600 (included 10% VAT). Its cost was 60.000 and accumulated depreciation through the disposal date was 52.000. Company also paid 500 commission to broker. 4. Exchanged an older model machine for a new model. The old model had original cost of 800.000 and 440.000 in accumulated depreciation; its fair value was 400.000 (excluded VAT). Company paid 110.000 to complete the exchange which has commercial substance. The VAT rate for both machines are at 10% 3. Get 1 tangible fixed assets through long-term joint ventures with their cost: 600.000, has accumulated depreciation 200,000 (according to the books of the contribution partner). Venture Board re-evaluated it to 500.000. 4. Purchase a patent for 40.000. The legal and other fees for transfer the patent is 4.000. 5. Purchase a new machine on an installment plan with monthly payment of 23.000 in 36 months. Given that in case of paying in full, the price is 720.000( excluded 5% VAT). Company received the machine and made the first month payment. Required: Prepare the accounting entries for transactions above

8.1 Company A pay VAT by the tax deduction method, on December of year N have the situation of fixed assets as follows: (Unit: 1,000 VND). Given that all payments are made by cash in bank 1. Purchased a machine for 70.000 which is used at the factory. In addition to the purchase price, company A made the following expenditures: freight, 3.000; installation, 6.000; testing, 4.000. It is sponsored by the Developing investment funds. 2. Purchased land and a warehouse for 1.200.000. In addition to the purchase price, company A made the following expenditures: broker's commission, 12.000; transferred tax, 6.000. An independent appraisal estimates the fair value of the land and warehouse at 840.000 and 560.000, respectively. 3. Sold an equipment for 6.600 (included 10% VAT). Its cost was 60.000 and accumulated depreciation through the disposal date was 52.000. Company also paid 500 commission to broker. 4. Exchanged an older model machine for a new model. The old model had original cost of 800.000 and 440.000 in accumulated depreciation; its fair value was 400.000 (excluded VAT). Company paid 110.000 to complete the exchange which has commercial substance. The VAT rate for both machines are at 10% 3. Get 1 tangible fixed assets through long-term joint ventures with their cost: 600.000, has accumulated depreciation 200,000 (according to the books of the contribution partner). Venture Board re-evaluated it to 500.000. 4. Purchase a patent for 40.000. The legal and other fees for transfer the patent is 4.000. 5. Purchase a new machine on an installment plan with monthly payment of 23.000 in 36 months. Given that in case of paying in full, the price is 720.000( excluded 5% VAT). Company received the machine and made the first month payment. Required: Prepare the accounting entries for transactions above

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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8.1 Company A pay VAT by the tax deduction method, on December of year N have the situation of fixed assets as follows: (Unit: 1,000 VND). Given that all payments are made by cash in bank 1. Purchased a machine for 70.000 which is used at the factory. In addition to the purchase price, company A made the following expenditures: freight, 3.000; installation, 6.000; testing, 4.000. It is sponsored by the Developing investment funds. 2. Purchased land and a warehouse for 1.200.000. In addition to the purchase price, company A made the following expenditures: broker's commission, 12.000; transferred tax, 6.000. An independent appraisal estimates the fair value of the land and warehouse at 840.000 and 560.000, respectively. 3. Sold an equipment for 6.600 (included 10% VAT). Its cost was 60.000 and accumulated depreciation through the disposal date was 52.000. Company also paid 500 commission to broker. 4. Exchanged an older model machine for a new model. The old model had original cost of 800.000 and 440.000 in accumulated depreciation; its fair value was 400.000 (excluded VAT). Company paid 110.000 to complete the exchange which has commercial substance. The VAT rate for both machines are at 10% 3. Get 1 tangible fixed assets through long-term joint ventures with their cost: 600.000, has accumulated depreciation 200,000 (according to the books of the contribution partner). Venture Board re-evaluated it to 500.000. 4. Purchase a patent for 40.000. The legal and other fees for transfer the patent is 4.000. 5. Purchase a new machine on an installment plan with monthly payment of 23.000 in 36 months. Given that in case of paying in full, the price is 720.000( excluded 5% VAT). Company received the machine and made the first month payment. Required: Prepare the accounting entries for transactions above 8.2 Jason Pharma incurred the following cost in this year related to a new drug: -Research for new formular: $2.425.000 -Development of a new formula: $1.600.000 -Legal and filing fees for a patent for the new formular: $60.000 The development costs were incurred after technological and commercial feasibility was established and after the future economic benefits were deemed probable. The project was completed and the new drug was patented before year end. Required: Caculate the amount of expense (reported in the IS) and asset arised (reported in the SOFP) in this activity.
Transcribed Image Text:8.1 Company A pay VAT by the tax deduction method, on December of year N have the situation of fixed assets as follows: (Unit: 1,000 VND). Given that all payments are made by cash in bank 1. Purchased a machine for 70.000 which is used at the factory. In addition to the purchase price, company A made the following expenditures: freight, 3.000; installation, 6.000; testing, 4.000. It is sponsored by the Developing investment funds. 2. Purchased land and a warehouse for 1.200.000. In addition to the purchase price, company A made the following expenditures: broker's commission, 12.000; transferred tax, 6.000. An independent appraisal estimates the fair value of the land and warehouse at 840.000 and 560.000, respectively. 3. Sold an equipment for 6.600 (included 10% VAT). Its cost was 60.000 and accumulated depreciation through the disposal date was 52.000. Company also paid 500 commission to broker. 4. Exchanged an older model machine for a new model. The old model had original cost of 800.000 and 440.000 in accumulated depreciation; its fair value was 400.000 (excluded VAT). Company paid 110.000 to complete the exchange which has commercial substance. The VAT rate for both machines are at 10% 3. Get 1 tangible fixed assets through long-term joint ventures with their cost: 600.000, has accumulated depreciation 200,000 (according to the books of the contribution partner). Venture Board re-evaluated it to 500.000. 4. Purchase a patent for 40.000. The legal and other fees for transfer the patent is 4.000. 5. Purchase a new machine on an installment plan with monthly payment of 23.000 in 36 months. Given that in case of paying in full, the price is 720.000( excluded 5% VAT). Company received the machine and made the first month payment. Required: Prepare the accounting entries for transactions above 8.2 Jason Pharma incurred the following cost in this year related to a new drug: -Research for new formular: $2.425.000 -Development of a new formula: $1.600.000 -Legal and filing fees for a patent for the new formular: $60.000 The development costs were incurred after technological and commercial feasibility was established and after the future economic benefits were deemed probable. The project was completed and the new drug was patented before year end. Required: Caculate the amount of expense (reported in the IS) and asset arised (reported in the SOFP) in this activity.
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