1. E. Adentwi Enterprises Ltd bought a machine for GH₵ 150,000 on 1st January 2019. It depreciates the machine on cost over four years assuming a nil residual value. The company received a grant of GH₵30,000 from the municipal assembly to support the acquisition of the machines. required : Account for this grant under the netting off method.
1. E. Adentwi Enterprises Ltd bought a machine for GH₵ 150,000 on 1st January 2019. It
The company received a grant of GH₵30,000 from the municipal assembly to support the acquisition of the machines.
required :
Account for this grant under the netting off method.
2. Polycarp Ltd adopts revaluation model for subsequent measurement of its intangible assets in accordance with IAS 38: Intangible assets. The policy of Polycarp is to revalue its intangible asset at the end of each year. An intangible asset with an estimated useful life of 9 years was acquired on 1 January 2018 for GH¢45,000. It was revalued to GH¢54,400 on 31 December 2018 and the revaluation surplus was correctly recognized on that date. As at 31 December 2019, the asset was revalued at GH¢32,000.
Required:
Discuss the accounting treatment required in 2018 and 2019 financial statements.
Step by step
Solved in 2 steps with 1 images
