SEMESTER one EXAMINATIONS, 2019
Aberystwyth Business School
AC32900/AC32920 FINANCIAL ACCOUNTING II CLASS TEST
MAE MODD I FYFYRWYR GYFLWYNO ATEBION I’R PAPUR HWN NAILL AI YN Y GYMRAEG NEU’R SAESNEG
STUDENTS MAY SUBMIT ANSWERS TO THIS PAPER IN EITHER WELSH OR ENGLISH
Time: THREE hours
This paper consists of ONE question with multiple parts and you need to answer all. You need to use the template financial statements to answer this question and attach the workings booklet to support your answers.
Provide all workings and assumptions in the workings booklet provided and attach the booklet to the template financial statements. Make sure your ID number is included at the top of each template page.
Total of 100 marks available.
This paper contributes 30% of the overall module mark.
Marks will be awarded for:
Casio FX83ES/GT or FX85ES/GT calculators only may be used.
Question 1 – 100 marks
Milly Steel plc, is a well-established steel manufacturer, has the following trial balance as at 31 December 2018.
The following additional information is available:
Also included in the stock take, was a specialist piece of machinery that had cost £450,000 to manufacture and was to be sold for £480,000 in January 2019. This customer is no longer trading but an alternative customer has been found who is willing to pay £440,000 and will take delivery in February 2019.
1 January, 1 May, and 1 August.
A capital repayment of £1,500,000 on the debenture loans is expected to be made on
1 May 2019.
On 31 December 2018, Milly Steel plc took on an additional debenture loan of £750,000. No accounting transactions have been made for this transaction.
|Power, rates, maintenance, insurance||5,000,000
|Production wages and salaries
Logistics wages and salaries
|Interest on bank overdraft and other borrowing costs||20,000|
|Income on investments||-900,000|
|Lease of premises (see note (v))||2,100,000|
All land and buildings, and plant and machinery were purchased on 1 January 2013 and if appropriate a zero residual value is assumed.
On 1 January 2018, a building which had cost £1,500,000 was sold for £6,000,000 the money being received on 30 June 2018. To date no accounting entries have been made for this transaction.
After the sale of the building, the directors realised the value of the rest of their estate was not reflecting its true market value. A surveyor has since submitted a report which states that the new value of the land and buildings is £14,610,000 (£12,000,000 and £2,610,000 respectively for land and buildings) as at 1 January 2018.
REQUIRED: Using the IAS template provided and the workings booklet
Where relevant, you should identify and justify any accounting treatment you adopt in the workings booklet. Please use cross-references to fully link your workings and your numbers in the financial statements.
NOTE: Some of the headings in the provided IAS/IFRS template may not be applicable to the context and requirements of this question.
End of Paper
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