gents eure Nane :_ittene vanes sR TES 9 ee Course: Financial Account Hotton 120 minutes (Close Book DayrDaie Tuesday. 2° April, 2019 . Lectures: Teaching Team unc SUBE ; ; “PROBLEM SHEET, MUST BE SUBMITTED ALONG wit ANS RITTEN OWN ON THE ANSWERING deanery NEWER, EXCEPT FOR MULTIPLE CHOICE, ARE —— ING THE CORRECT ANSWER, oR SHEET (DOUBLE POLIO SHEET) _ REASON FOR CHOOSIN PART I: TRUE OR FALSE (WRITE DOWN THE THE POINT WILL BE ZERO) ~ 10% Provisions must be presented as a curent liabilities only sagvaiue of the bond. ve carrying value | “Atany point daring the tem of te Bon, te balance inthe Bonds payable aee00" should be the carry Lee -utars issued for goods or services othcr than cash atte cost oF HS goods or se lative amortization. the equity method. nount ofthe investment minus eum lcrease the investments carrying value under BLEM SHEET) ~ 20% Companies should reco “Amortized cost is the initial recognition ced by an investor from the investee di All dividends r YOU MUST CROSS THE CORRECT ANSWER ON THIS PRO! PART I : MULTIPLE CHOICE ( lance withthe respective standard. except to SFAS (PSAK) No $7, these accounting treatment won't be in accord ‘and the amount can be estimated reliably, © According on their for: ‘a. Company that has high probability t should recognized the proceed that they will receive statement of financial position. b. Company that has land for mining purposes, form, once it finished the mining process in the future, present value technique, sme in the form of flight miles, needs o estimate the future miles that will be e. Company that has a customer loyalty programm ized an expense and liabilities arising from such transactions. ns recorded, due to changes in risks, events, or 10 win the court case in the near future, -d as a court case receivable in the current assets section and according to the relevant laws, need to restore the land to it’s original needs to recognize liabilities and expenses in the present, using & redeemed by the customer, and must recogni 4. Company needs toassess whether thee is change in the amount of provi crcumstances, The change in the amount of provisions must be recognized directly in Other Comprehensive Income (ooh, prota to tere Debt investments that meet the business model and contractual cash flow tests are reported at: a. net realizable value. b. amortized cost ¥ . fairvalue. d. the lower of amortized cost or fair value ‘¢ What effect will the acquisition of treasury shares have on shareholders’ equity and earnings per share, respectively? a. Decrease and no effect b, Decrease and increase ~ Page 1 of 4 ee ra € Increase and no effect 4. Increase and Decrease # A discount on notes payable is charged to interest exPENSE equally over the life of th b. only inthe year the not €. using the effective-inte <4. only in the year the note matures. + Equity investments acquired by a corpo Pd by pig hing i oe other comprehensive income andas a separate component of equi sas ‘a. nondrading wherea company has hoklings of less than 20%, bs uading investments where a company has hollings of ss than 20%, «c. investments where company has holdings of between 20% and S0%, “d_investments where a company has holdings of more than 50% «Sky Corporation has the following account balances at December 31, 2017, Share capital ordinary, 85 par value $510,000 Neer “Treasury Shares 5 90,000 Retained Famings Jan 1, 2017 $1,850,000 Share premium ~ ordinary $1,230,000 How much is the total sharehoMlers" equity at December 31, 20172 a $4,720,000 b. $4,900,000 94290,000 7 4,920,000 , ames Co, sold an equity investment that had been purchased on January 4, 2018, antes ovned no + On December 29, 2019 ‘An unrealized holding loss was reported in the 2018 income statement. A realized yin vas ‘other equity investmen reported inthe 2019 income statement, Was the equity investment classified as non-trading and did ts 2018 mathe price decline exceed its 2019 market price recovery? 2018 Market Price Now ‘Trading Decline Exceeded 2019 Market Price Recovery a Yeu Yen A be Yeu Nox No You. d No No + On Jan 1, 2019 PT, Jon! issued bonds amounted Rp, 800 million, with 5% coupon and will be matured in 4 years. The bond as issued ot par, and paid tho Interent annually on Jan 1, The prineipal amount of the bons would be pal in istathnent with the equal amount, every Jan 1, How much te amount of current Uablltes that will be reconled by PT Jonk on Dew 31, 201 ad Dec 31, 2020, respectively? 4. Hp. 200 million and Rp, 200 million 4 Page 2of 4Rp. 240 million and Rp. 240 million © Rp. 240 milion and Rp, 230 million 4. Rp. 40 million and Rp, 30 million edthe * Aten-year bond was issued in 2017 ata discount with a call provision to retire the bonds. When the bond issuer exercised th ‘all provision on an interest date in 2019, the carrying amount of the bond was less than the call price. The smount of bond ability removed from the accounts in 2019 should have equaled the: a. call price '. call price less unamontized discount ©. face amount carrying amount” * An investor has a long-term investment in ordinary shares. Regular cash dividends received by the investor are recorded 3 Fair Value Method Equity Method Income Income b. Income A reduction ofthe investment ~ © A reduction ofthe investment A reduction ofthe investment dA reduction ofthe investment Income PARTI: ESSAY- 60% Essay 0%), The following i a summary ofall relevant transactions of Well Corporation since it was organized in 2015, In 2015, 15,000 shares were authorized and 7,000 ordinary shares ($40 par value) were issued at a price of $47. In 2016, 1,000 shares were issued as a share dividend when a share was selling for $50, Three hundred ordinary share were bought in 2017 ata ost of $54 per share, These 300 shares are stil inthe company teasiry. ‘In 2016, 10,000 preference share were authorized and the company issued 5,000 of them ($105 par value) at $118, Some of the Preference shares were acquired by the company and later reissued for $7,400 more than it cost the company, The corporation has eamed a total of $601,000 in net income and paid out a total of $316,200 in cash dividends since incorporat Instruction: Prepare the equity seeton of the statement of financial position in proper from for Well Corporation as of December 31,2017, Account for treasury share using the cost method. Essay2 20%) Tania Co. sells €600,000 of 12% bonds on June 1, 2018. The bonds pay interest on December I and June 1. The due date of the bonds is June 1, 2023, The bonds yield 10%, selling for €638,780. On October 1, 2019, Titania buys back €300,000 worth of bonds for €315,000 (includes accrued interest. Give entries through October 1, 2019.- ne OcLOIN® geticy = =\ yekigntan ° 7 from he ine of sale wml the date indicated Titanig i. relevant journal entries sde reversing entries a the Deg th any tht ls lst quent. All he leon euipment were come YP with 1 year PT Indah isa company that se Buarantee on spa in which the customers might return the totally defect a vice, The company also provide a retum policy, ind service. The company also provide 4 ; " nm repuived and gst 100% cash refund, if i retuned within 7 days. The company asl . oduct, th red and yet 100% cash refund, if : ec h eed aes and i's provisions. The data about the tansacreg can be seen below conceming the transsetions rel For te year ended 2018, PT; Indah sold 1.000 units of products, The slling Prices Rp. 10.000, ea Secet ome, products were Rp, 7.500, +b. Based on the historical data statistics, Based on historical dt, the maximum eos for spare part and service ‘ere Rp. 3.000 and Rp. 2.000, respectively, 4 Gompany classed the lve of defect nto thee: (1) ight, (2) ‘medium, (3) heavy. This is not i Desel on te historical dt, the percentage rate ofthe defect for, “ach category were: 50%, 40%, and ‘The amount of spare part and service required for each level of defect can be presented 25 follows Level of Spare Part Labor / Service | Defect ight 10% from maximum cost 20% from maximum cost 50% from maximum cost 40% from maximum cost 100% from maximum cost 100% from maximum cost (osupport your suggestion) PARTIV: THEORY 109/ = GOOD LUCK -