CFAS Suggested Answers

Chapter 20 SUGGESTED ANSWERS
PAS 36 Impairment of Assets Cash Generating Unit (CGU)
20-1 Zee Answer: A

Carrying amount 6,000,000
Fair Value - higher than value in use 4,500,000 20-1
Impairment loss 1,500,000 20-2
20-3
20-2 Cynosure Answer: B 20-4
Carrying amount 1,600,000 20-5
Recoverable amt (Fair value) 1,400,000 20-6
Impairment loss 200,000 20-7 1
2
20-3 Ball Answer: B 3
Cash inflows from use of machinery 1,600,000 4
Cash outflows from use of machinery (750,000) 20-8 1
Cash proceeds from sale of inventory 500,000 2
Net cash inflows 1,350,000 3
4
20-4 Bubba Answer: C 20-9 1
Cost of equipment 5,000,000 2
Accumulated depreciation 3,000,000 3
Carrying amount 2,000,000 4
Fair value 1,250,000 5
Impairment loss 750,000 6
7
20-5 Zambia Answer: A 8
Fair value 10,000,000 9
Value in use 8,475,000 10
Higher amount 10,000,000 20-10 1
2
Building 25,000,000 3
Accumulated depreciation 6,750,000 4
Fair value (higher amount) 10,000,000
Impairment loss 8,250,000
20-6 Zimbabwe Answer: A

Fair value 3,000,000
Value in use 3,192,000
Higher amount 3,192,000
Building 5,000,000
Accumulated depreciation 1,500,000
Carrying amount 3,500,000
Fair value (higher amount) 3,192,000
Impairment loss 308,000
20-7 Jolo
Question 1 Answer: C
Carrying amount of the Cash Generating Unit 5,000,000
Impairment loss allocated to Goodwill 500,000
Remaining impairment loss 900,000
Question 2 Answer: A
Building 2,000,000 4/9 400,000
Inventory 1,500,000 1/3 300,000
Trademark 1,000,000 2/9 200,000
4,500,000 900,000
Question 3 Answer: B
20-8 Palawan
Carrying amount of the Cash Generating Unit 10,000,000
Building 5,000,000 1/2 1,000,000
Equipment 3,000,000 2/7 600,000
Inventory 2,000,000 1/5 400,000
10,000,000 2,000,000
20-9
Question 7 Answer: D
20-10
A
B
B
C
A
A
C
A
B
C
A
A
A
A
B
C
A
A
B
A
D
D
A
B
C
D
B
D
D
PAS 38 Intangible Assets Research and Development Cost
21-1 Vanessa Answer: A

Franchise 1,000,000
Computer software 1,500,000 21-1
Patent 2,500,000 21-2
Customer list 500,000 21-3
Copyright 700,000 21-4
Goodwill 4,000,000 21-5
Trademark 900,000 21-6
Total intangible assets 11,100,000 21-7 1
2
21-2 Mariz Answer: B 3
Cost of trademark 3,500,000 4
Employment benefits relating to testing 200,000 5
Total capitalizable cost 3,700,000 6
7
21-3 Ward Answer: C 8
Depreciation of equipment 135,000 21-8 1
Materials used 200,000 2
Compensation cost of personnel 500,000 3
Outside consulting fees 150,000 4
Indirect costs allocated 250,000 5
Total R&D Expense 1,235,000 6
7
21-4 Koral Answer: A 8
Modification to the formulation 135,000 21-9 1
Design of tools, jigs, molds and dies 170,000 2
Laboratory research 215,000 3
Total R&D Expense 520,000 4
5
21-5 Cody Answer: D 6
Design of tools, jigs, molds and dies 125,000 7
Modification to the formulation 160,000 8
10
21-6 Dell Answer: C 21-10 1
Design, construction and testing of models 110,000 2
Laboratory research 180,000 3
5
21-7 6
Question 1 Answer: D 7
Question 2 Answer: C 8
Question 5 Answer: D 21-11 1
21-12 1
21-8 2
Question 2 Answer: B 4
Question 4 Answer: A 6
21-9
21-10
21-11 Question 1 Answer: C
21-12
A
B
C
A
D
C
D
C
D
D
D
D
D
D
C
B
D
A
A
C
A
D
D
D
D
C
C
D
C
B
B
A
D
D
A
D
A
D
D
C
B
C
C
B
A
A
B
B
A
C
A
B
D
B
PAS 40 Investment Property
22-1 Galore
Cost of investment property 50,000,000 22-1 1
Residual value 5,000,000 2
Depreciable amount 45,000,000 22-2 1
Annual depreciation 25 years 1,800,000 2
Question 2 Answer: A 22-3
22-4
22-2 Eragon 22-5 1
Question 1 Answer: B 2
Land for undetermined use 5,000,000 3
Vacant building to be leased out 3,000,000 4
Building owned 1,500,000 5
Property under construction for use as IP 6,000,000 6
Total investment property 15,500,000 7
Property held for use in production 4,000,000 9
Land leased to a subsidiary under op lease 2,500,000 10
Land held for future use as factory site 3,500,000 22-6 1
Machinery leased out under op lease 1,000,000 2
11,000,000 3
4
22-3 Bona Answer: A 5
Sale price 2,900,000 6
Gain on disposal of property 865,000 8
9
22-4 Dayanara Answer: B 10
FV 2019 FV2020 Gain/(loss) 22-7 1
Property 1 3,200,000 3,500,000 300,000 2
Property 2 3,050,000 2,850,000 (200,000) 3
Property 3 3,850,000 3,600,000 (250,000) 4
Net loss from change in fair value (150,000) 5
22-5
22-6
22-7
A
A
B
A
A
B
C
D
D
B
A
C
B
A
A
A
D
A
D
A
A
D
D
A
D
D
B
A
D
A
A

CFAS Suggested Answers

Uploaded by

Copyright:

Available Formats

CFAS Suggested Answers

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

CFAS Suggested Answers

Uploaded by

Copyright:

Available Formats

Chapter 20 SUGGESTED ANSWERS

PAS 36 Impairment of Assets Cash Generating Unit (CGU)

20-1 Zee Answer: A

20-6 Zimbabwe Answer: A

21-1 Vanessa Answer: A

You might also like