QUESTION 4 15 MARKS Guess Limited is a company operating in the textile industry. The following Issues were identified by the accountant for the current year ended 30 June 2024, no adjustments have yet been processed: Issue 1: •The bookkeeper erroneously credited revenue with Pay-as-you-earn (PAYE) of N$ 250 000 owing to the tax authorities in 2023. ⚫As a result, the current tax in 2023 had been incorrectly estimated by the accountant and the incorrect figures were submitted on the 2023 tax returns. •This error did not affect the salaries and wages expense, nor the amount paid to employees. Additional information: • Ignore tax. All amounts are considered to be material. FACULTY OF COMMERCE, MANAGEMENT AND LAW OLD CURRICULUM MODULES Page 17 of 19 REQUIRED: Marks (a) Write a memo to the accountant of Guess Limited wherein you define the term 'events after the reporting period' and explain the difference between an adjusting event and a non-adjusting event as per IAS 10: Events after the reporting period. 6 (b) Prepare all the adjusting journal entries necessary to prepare the financial statements for the year ended 30 June 2024. Narrations are required 3 (c) Prepare the correction of error note of Guess Limited for the year ended 30 June 2024 in accordance with International Financial Reporting Standards. 6 Total marks 15
QUESTION 4 15 MARKS Guess Limited is a company operating in the textile industry. The following Issues were identified by the accountant for the current year ended 30 June 2024, no adjustments have yet been processed: Issue 1: •The bookkeeper erroneously credited revenue with Pay-as-you-earn (PAYE) of N$ 250 000 owing to the tax authorities in 2023. ⚫As a result, the current tax in 2023 had been incorrectly estimated by the accountant and the incorrect figures were submitted on the 2023 tax returns. •This error did not affect the salaries and wages expense, nor the amount paid to employees. Additional information: • Ignore tax. All amounts are considered to be material. FACULTY OF COMMERCE, MANAGEMENT AND LAW OLD CURRICULUM MODULES Page 17 of 19 REQUIRED: Marks (a) Write a memo to the accountant of Guess Limited wherein you define the term 'events after the reporting period' and explain the difference between an adjusting event and a non-adjusting event as per IAS 10: Events after the reporting period. 6 (b) Prepare all the adjusting journal entries necessary to prepare the financial statements for the year ended 30 June 2024. Narrations are required 3 (c) Prepare the correction of error note of Guess Limited for the year ended 30 June 2024 in accordance with International Financial Reporting Standards. 6 Total marks 15
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:QUESTION 4 15 MARKS
Guess Limited is a company operating in the textile industry. The following Issues were
identified by the accountant for the current year ended 30 June 2024, no adjustments have yet
been processed:
Issue 1:
•The bookkeeper erroneously credited revenue with Pay-as-you-earn (PAYE) of
N$ 250 000 owing to the tax authorities in 2023.
⚫As a result, the current tax in 2023 had been incorrectly estimated by the accountant
and the incorrect figures were submitted on the 2023 tax returns.
•This error did not affect the salaries and wages expense, nor the amount paid to
employees.
Additional information:
• Ignore tax.
All amounts are considered to be material.
FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
Page 17 of 19
REQUIRED: Marks
(a) Write a memo to the accountant of Guess Limited wherein you define the
term 'events after the reporting period' and explain the difference between
an adjusting event and a non-adjusting event as per IAS 10: Events after the
reporting period. 6
(b) Prepare all the adjusting journal entries necessary to prepare the financial
statements for the year ended 30 June 2024.
Narrations are required 3
(c) Prepare the correction of error note of Guess Limited for the year ended 30
June 2024 in accordance with International Financial Reporting Standards. 6
Total marks 15
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