Tiêu đề key answers from inventory, biological , ppe and intangible.pdf ✅

Inventories Page 1 of 69 INVENTORIES INVENTORY Initial Measurement: Cost of Inventories Problem 1: (Cost of Inventories) The costs set out below are those typically incurred by manufacturing businesses: Items Inventoriable? Amount Explanation 1. Supplier’s gross price for raw materials, P150,000 Yes P150,000 2. Materials purchased from another supplier on extended credit amounting to P570,000. The price to be paid under normal credit term is P550,000 Yes 550,000 The amount to be recorded is based on the price under normal credit term. The difference between the price under normal credit and extended credit term is recorded as interest expense over the credit term 3. Invoice price of raw materials purchased amounting to P180,000. Quantity discount of 10, 5 are allowed by supplier. Yes 180,000 Invoice price means the quantity discount or trade discount was already deducted 4. Materials purchased from a supplier amounting to P616,000, inclusive of 12% VAT. The company is VAT registered and can claim this as an input VAT. Yes 550,000 This is an example of recoverable purchase tax since it can be claimed as an input VAT. 5. Materials purchased from a supplier amounting to P515,000, inclusive of nonrecoverable purchase tax of P15,000 Yes 515,000 6. Cost of transporting raw materials to the business premises, P5,000 Yes 5,000 7. Import duties paid to authorities on import of raw materials to be used during the manufacturing process, P25,000 Yes 25,000 8. Labor cost directly incurred in the processing of raw materials, P420,000 Yes 420,000 9. Normal amount of wasted labor, P57,000 Yes 57,000 10. Abnormal amount of wasted labor, P69,000 No Abnormal waste is not inventoriable 11. Variable costs (electricity) incurred in the processing of raw materials, P10,000 Yes 10,000 12. Fixed production overheads amounting to P500,000. The normal capacity is 100,000 machine hours but the company only used 80,000 machine hours Yes 400,000 The amount of overheads allocated to each unit of production is not increased as consequence of low- capacity or idle plant and as a result, unallocated overhead are expensed in the period. The cost per unit would then be computed using the normal capacity as follows: Cost per unit = Budgeted fixed overhead ÷ Normal capacity Cost per unit = P500,000 ÷ 100,000 units Cost per unit = P5/unit Therefore , the P500,000 is broken down as follows: a. Inventoriable =P5/unit x 80,000 units =P400,000 If the actual capacity is used, the unit cost would have been P6.25 (P500,000 ÷ 80,000 units), which is higher than the unit cost using the normal capacity. b. Expensed (closed to cost of goods sold) =P5/uunit x 20,000 units

Inventories Page 3 of 69 Direct materials inventory, beginning 90,000 Net purchases Purchases 510,000 Freight in 20,000 Gross purchases 530,000 Purchases returns and allowances - Purchase discounts (10,000) 520,000 Direct materials available for use 610,000 Direct materials end (65,000) Direct materials used 545,000 Direct labor 160,000 Applied factory overhead Indirect materials 300,000 Depreciation on factory machinery 10,000 Factory rent 12,000 Indirect labor 70,000 Taxes 8,000 400,000 Total manufacturing cost 1,105,000 Work in process, beginning 200,000 Total cost of goods placed in process 1,305,000 Work in process, end (100,000) Cost of goods manufactured 1,205,000 Finished goods, beginning 190,000 Total cost of goods available for sale 1,395,000 Finished goods, end (150,000) Cost of goods sold 1,245,000 Items to be included in inventory Problem 1: (Items to be included in inventory) As part of your engagement to audit the financial statements of Action Company for the year ended December 31, 20x6, you have been assigned the merchandise inventory account. You found the following items to be included in the merchandise inventory: Items counted in the warehouse (bodega) (including P32,000 damaged and unsalable goods) P4,000,000 3,968,000 Items included in the count specifically segregated per sales contract 80,000 (80,000) Goods held on consignment, at sale price, cost P125,000 250,000 Items in receiving department, returned by the customer, in good condition 60,000 60,000 Goods out on consignment, at sales price, cost P150,000 200,000 150,000 Items ordered and in the receiving department, invoice not yet received 30,000 30,000 Items ordered, invoiced received but goods not received. Freight is paid by buyer 100,000 100,000 Items on counter for sale 150,000 150,000 Items in receiving department, refused by the entity because of damage 200,000 Items in shipping department 220,000 220,000 Items shipped today, invoice mailed, FOB shipping point 35,000 Items shipped today, invoice mailed, FOB destination 25,000 25,000 Items currently being used for window display 13,000 13,000 Total P5,363,000 P4,636,000 Required: Compute for the correct amount of inventory. Repurchase arrangements What exactly are “repurchase agreements” and what is their impact on accounting for revenue under IFRS 15? Repurchase agreements are agreements in which an entity will sell a good to a customer but either 1) promises or 2) has the option of repurchasing the particular good. The asset repurchased does not necessarily need to be the asset originally sold to the customer; it may be substantially the same, or even a component of the original. Repurchase agreements generally come in three forms: 1. Forward – an entity’s obligation to repurchase the asset. A forward contract means the entity has an obligation to repurchase the asset. Since control is not transferred to customer, the company should account the contract: Original selling price xxx Original selling price xxx Less: Repurchase price (xxx) Less: Repurchase price (xxx) Lease (IFRS 16) + Finance arrangement -/0 2. Call option – an entity’s right to repurchase the asset. An option means the entity has the right to repurchase the asset. Since control is not transferred to customer, the company should account the contract: Original selling price xxx Original selling price xxx Less: Repurchase price (xxx) Less: Repurchase price (xxx) Lease (IFRS 16) + Finance arrangement -/0 3. Put option – an entity’s obligation to repurchase the asset at the customer’s request. A put option is a right of the customer to require the entity to repurchase the asset. Since control is not transferred to the customer, the company should account the contract: