Question 9 At 30 September 2023 Sandown Ltd's trial balance showed a brand at a cost of £30 million less accumulated amortisation brought forward at 1 October 2022 of £9 million. Amortisation is based on a 10-year useful life. An impairment review on 1 April 2023 concluded that the brand had a value in use of £12 million and a remaining useful life of three years. However, on the same date Sandown Co received an offer to purchase the brand for £15 million. Required: What should be the carrying amount of the brand in the statement of financial position of Sandown Ltd as at 30 September 2023. (Enter your answer to the nearest £000) Question 10 Dempsey Ltd's year end is 30 September 2023. Dempsey Ltd commenced the development stage of a project to produce a new pharmaceutical drug on 1 January 2023. Expenditure of £40,000 per month was incurred until the project was completed on 30 June 2023 when the drug went into immediate production. The directors became confident of the project's success on 1 March 2023. The drug is expected to generate benefits for 5 years. Required: What is the carrying amount of any intangible asset recognised in respect of the project at 30 September 2023 and what is the total amount Dempsey Ltd will charge to profit or loss for the year ended 30 September 2023?
Question 9 At 30 September 2023 Sandown Ltd's trial balance showed a brand at a cost of £30 million less accumulated amortisation brought forward at 1 October 2022 of £9 million. Amortisation is based on a 10-year useful life. An impairment review on 1 April 2023 concluded that the brand had a value in use of £12 million and a remaining useful life of three years. However, on the same date Sandown Co received an offer to purchase the brand for £15 million. Required: What should be the carrying amount of the brand in the statement of financial position of Sandown Ltd as at 30 September 2023. (Enter your answer to the nearest £000) Question 10 Dempsey Ltd's year end is 30 September 2023. Dempsey Ltd commenced the development stage of a project to produce a new pharmaceutical drug on 1 January 2023. Expenditure of £40,000 per month was incurred until the project was completed on 30 June 2023 when the drug went into immediate production. The directors became confident of the project's success on 1 March 2023. The drug is expected to generate benefits for 5 years. Required: What is the carrying amount of any intangible asset recognised in respect of the project at 30 September 2023 and what is the total amount Dempsey Ltd will charge to profit or loss for the year ended 30 September 2023?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Question 9
At 30 September 2023 Sandown Ltd's trial balance showed a brand at a cost of £30 million
less accumulated amortisation brought forward at 1 October 2022 of £9 million.
Amortisation is based on a 10-year useful life. An impairment review on 1 April 2023
concluded that the brand had a value in use of £12 million and a remaining useful life of
three years. However, on the same date Sandown Co received an offer to purchase the
brand for £15 million.
Required:
What should be the carrying amount of the brand in the statement of financial position of
Sandown Ltd as at 30 September 2023. (Enter your answer to the nearest £000)
Question 10
Dempsey Ltd's year end is 30 September 2023. Dempsey Ltd commenced the
development stage of a project to produce a new pharmaceutical drug on 1 January 2023.
Expenditure of £40,000 per month was incurred until the project was completed on 30
June 2023 when the drug went into immediate production. The directors became confident
of the project's success on 1 March 2023. The drug is expected to generate benefits for 5
years.
Required:
What is the carrying amount of any intangible asset recognised in respect of the project at
30 September 2023 and what is the total amount Dempsey Ltd will charge to profit or loss
for the year ended 30 September 2023?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education