International Accounting
5th Edition
ISBN: 9781259747984
Author: Doupnik, Timothy S., Finn, Mark T., Gotti, Giorgio
Publisher: Mcgraw-hill Education,
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Question
Chapter 4, Problem 29EP
a.
To determine
Explain the amount of magnitude of difference in R&D (Research & Development) related expenses of Company H for fiscal year 2015 as per US GAAP (Generally Accepted Accounting Principles).
b.
To determine
Explain the amount of magnitude of difference in R&D-related expenses of Company H for fiscal year 2017 as per US GAAP.
c.
To determine
Report the decision to capitalize R&D expenses decreases reported profitability as compared with full expensing system required by Company H.
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AF’s property, plant, and equipment is reported at cost. The company has a policy ofnot revaluing property, plant, and equipment. Suppose AF decided to revalue its flightequipment on December 31, 2015, and that the fair value of the equipment on that datewas €10,000 million. Prepare the journal entry to record the revaluation, assuming thatthe journal entry to record annual depreciation had already been recorded. (Hint: youwill need to locate the original cost and accumulated depreciation of the equipment atthe end of the year in the appropriate disclosure note.)
LJH Bhd used the cost method to record its intangible assets and estimated the useful life of the development costs to be five years beginning year 2017. Due to the low demand in the market for the new products, LJH Bhd estimated that the recoverable amount for the development costs was only RM450,000 at the end of the year 2018.
Required:
a) Calculate the amount of development costs that can be capitalized as at 31 December 2017.
B)Prepare the relevant journal entries in year 2017 and 2018.
c)Briefly explain the appropriate accounting treatment if there is no foreseeable limit to the period over which the development cost is expected to generate net cash flows for LJH Bhd according to MFRS138 Intangible Assets.
On January 1, 2015, Guiamalon Company reported the following account balances relating to property, plant, and equipment:
Land
2,000,000
Building
15,000,000
Accumulated
Depreciation
3,750,000
Machinery
3,000,000
Accumulated
Depreciation
1,500,000
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used.
On January 1, 2015, the entity decided to revalue the property, plant, and equipment. On such date, competent appraisers
Chapter 4 Solutions
International Accounting
Ch. 4 - Prob. 1QCh. 4 - How do IFRS and U.S. GAAP differ in their approach...Ch. 4 - Prob. 3QCh. 4 - Prob. 4QCh. 4 - Prob. 5QCh. 4 - Prob. 6QCh. 4 - Prob. 7QCh. 4 - Prob. 8QCh. 4 - Prob. 9QCh. 4 - Where in the food products value chain are...
Ch. 4 - Prob. 11QCh. 4 - Prob. 12QCh. 4 - Prob. 13QCh. 4 - Prob. 14QCh. 4 - Prob. 15QCh. 4 - Prob. 16QCh. 4 - Prob. 17QCh. 4 - Prob. 18QCh. 4 - Prob. 19QCh. 4 - Prob. 20QCh. 4 - Prob. 21QCh. 4 - How does the two-step model traditionally used for...Ch. 4 - How are borrowing costs accounted for under IFRS?Ch. 4 - Prob. 24QCh. 4 - 1. A company incurred the following costs related...Ch. 4 - 2. A company determined the following values for...Ch. 4 - Prob. 3EPCh. 4 - 4. On January 1, Year 1, an entity acquires a new...Ch. 4 - Prob. 5EPCh. 4 - 6. Under IFRS, an entity that acquires an...Ch. 4 - Prob. 7EPCh. 4 - Prob. 8EPCh. 4 - Prob. 9EPCh. 4 - Prob. 10EPCh. 4 - Prob. 11EPCh. 4 - Changsha Corporation purchased an asset during the...Ch. 4 - Prob. 13EPCh. 4 - Prob. 14EPCh. 4 - In the fourth quarter of Year 1, Beech Corporation...Ch. 4 - 16. This is a continuation of problem 15. At...Ch. 4 - 17. Steffen-Zweig Company exchanges two used...Ch. 4 - 18. Stevenson Corporation acquires a one-year-old...Ch. 4 - 19. Quick Company acquired a piece of equipment in...Ch. 4 - Prob. 20EPCh. 4 - 21. Jefferson Company acquired equipment on...Ch. 4 - 22. Madison Company acquired a depreciable asset...Ch. 4 - 29. Stratosphere Company acquires its only...Ch. 4 - QualCore Company began operations on January 1,...Ch. 4 - 26. Buch Corporation purchased Machine Z at the...Ch. 4 - Prob. 26EPCh. 4 - Prob. 27EPCh. 4 - Prob. 28EPCh. 4 - Prob. 29EPCh. 4 - Prob. 31EPCh. 4 - Prob. 33EPCh. 4 - Prob. 34EPCh. 4 - Prob. 35EPCh. 4 - Prob. 36EPCh. 4 - Prob. 37EP
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