ACC2004 Financial Accounting Standards and Corporate Reporting

Published : 01-Oct,2021 | Views : 10

Question:

Farhmahouse Ltd reported sales revenue of $16 million for the year ended 30 June 2013. In preparing the financial statements the following matters were considered:
(a) Income tax expense for the year ended 30 June 2013 was $218 640.
(b) Financial restructuring has resulted in the disposal of land, bought in 2002 for future expansion, for a profit of $200 000.
(c) A dividend of $26 000 has been received from a subsidiary company.
(d) Other expenses incurred: Interest Wages and salaries Selling expenses Administration expenses Bad debts Other expenses Electricity/water Cost of sales $480 000 5 492 000 2 500 000 100 000 200 000 440 667 480 000 5 000 000
(e) On 10 October 2012, plant with a carrying amount of $320 000 was destroyed by an earthquake.
(f) During the period, non-current assets were revalued upwards by a net $120 000.
(g) The foreign currency translation reserve fell by $60 000 as a result of translating the financial statements of a foreign operation.
(h) Balance of retained earnings as at 1 July 2012 was $567 040.

Required

Prepare a statement of comprehensive income with relevant notes in accordance with the requirements of AASB 101. You are required to prepare this assignment on excel using formulas. Once completed, the excel file must be uploaded on Moodle. This is an individual assignment.

Answer:

Particulars	For the year ended on 30 June, 2013
Sale of product	1,60,00,000
Cost of sales	50,00,000
Gross Profit	1,10,00,000
Other income	2,26,000
Operating and other expenses	11,20,667
Employee benefit expenses	54,92,000
Selling & administration expenses	26,00,000
Finance costs	4,80,000
Operating Profit before extraordinary items	15,33,333
Loss of Plant due to earthquake	(3,20,000)
Profit before tax	12,13,333
Less: Income tax expense	2,18,640
Profit for the year	9,94,693
Revaluation of land (net of tax)	1,80,000
Other comprehensive income for the year (net of tax)	1,80,000
Total comprehensive income for the year	11,74,693
Net profit attributable to shareholders	11,74,693
Opening balance in Retained Earnings	5,67,040
Closing Retained Earnings	17,41,733
Dividend received from subsidiary company	26,000
Profit on disposal of land	2,00,000
Total other income	2,26,000
Electricity / water	4,80,000
Bad debts	2,00,000
Other expenses	4,40,667
Total operating and other expenses	11,20,667
Wages and salaries	54,92,000
Total employee benefits expense	54,92,000
Selling expenses	25,00,000
Administration expenses	1,00,000
Total selling & admin expenses	26,00,000
Interest expense	4,80,000
Total finance cost	4,80,000