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FR – Financial Reporting

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Showing 1–3 of 10 questions

Question 1

Plateau Co has the following construction contract in progress:

                                                                                    $m

Total contract price                             750

Costs incurred to date               225

Estimated costs to completion 340

Progress payments invoiced and received 290

Calculate the amounts to be recognized for the contract in the statement of profit or loss and statement of financial position using the proportion of costs incurred method.

Statement of profit or loss Statement of financial position

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  • ○

    $74m                             $9m
  • ○

    $111m               $46m
  • ○

    $9m                             $74m
  • ○

    $185m               $120m
Question 2

Veronica plc prepares its financial statements to 31 December. During 2012 Veronica plc made sales of $850,000 and incurred costs of $610,500. At the beginning of 2012 customers owed

$125,500 and at the end of the year they owed $135,400. At the beginning of 2012 Veronica plc owed $45,500 to its suppliers and employees and at the end of the year it owed $35,700.

During 2012 Veronica plc received interest of $14,500 and paid interest of $500.

In accordance with IAS 7 Statement of Cash Flows, what was Veronica plc's net cash from operating activities under the direct method for the year ended 31 December 2012?

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  • ○

    $258,700
  • ○

    $233,800
  • ○

    $219,800
  • ○

    $219,300
Question 3

POXITplc controls another entity, DOBE Ltd, owning 60% of that company's ordinary share capital. At the group's year end, 31 December 2012, DOBE Ltd included $6,000 in its receivables in respect of goods supplied to POXIT plc. However, the payables of POXITplc included only $4,000 in respect of amounts due to DOBE Ltd. The difference arose because, on 31 December 2012, POXITplc sent a cheque for $2,000 to DOBE Ltd, which was not received by DOBE Ltd until 3 January 2013.

Which of the following sets of consolidation adjustments to current assets and current liabilities is correct?

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  • ○

    Deduct $6,000 from both consolidated receivables and consolidated payables
  • ○

    Deduct $3,600 from both consolidated receivables and consolidated payables
  • ○

    Deduct $6,000 from consolidated receivables and $4,000 from consolidated payables, and include cash in transit of $2,000
  • ○

    Deduct $6,000 from consolidated receivables and $4,000 from consolidated payables, and include inventories in transit of $2,000