QUIZ 1
1.
An entity purchased property for RM6 million on 1 July 20X3. The land element of the
purchase was RM1 million. The expected life of the building was 50 years and its
residual value nil. On 30 June 20X5 the property was revalued to RM7 million, of which
the land element was RM1.24 million and the buildings RM5.76 million. On 30 June
20X7, the property was sold for RM6.8 million.
What is the gain on disposal of the property that would be reported in the
statement of profit or loss for the year to 30 June 20X7?
2.
A.
Gain RM40,000.
B.
Loss RM200,000.
C.
Gain RM1,000,000.
D.
Gain RM1,240,000.
A manufacturing entity receives a grant of RM1m towards the purchase of a machine on
1 January 20X3. The grant will be repayable if the entity sells the asset within 4 years,
which it does not intend to do. The asset has a useful life of 5 years.
What is the deferred income liability balance at 30 June 20X3?
3.
A.
RM100,000.
B.
RM200,000.
C.
RM800,000.
D.
RM900,000.
During the current year an entity had in place RM1 million of 6% loan finance and RM2
million of 9% loan finance. It constructed a new factory which cost RM600,000 and this
was funded out of the existing loan finance. The factory took 8 months to complete.
What is the borrowing costs that should be capitalised?
4.
A.
RM48,000.
B.
RM32,000.
C.
RM60,000.
D.
RM180,000.
Which of the following items should be capitalised within the initial carrying
amount of an item of plant?
A.
Cost of transporting the plant to the factory.
B.
A deduction to reflect the estimated realisable value.
C.
Cost of a three‐year maintenance agreement.
D.
Cost of a three‐week training course for staff to operate the plant.
5.
An entity purchased a property 15 years ago at a cost of RM100,000 and have been
depreciating it at a rate of 2% per annum, on the straight line basis. The entity have had
the property professionally revalued at RM500,000.
What is the revaluation surplus that will be recorded in the financial statements in
respect of this property?
6.
A.
RM400,000.
B.
RM430,000.
C.
RM500,000.
D.
RM530,000.
A building contractor decides to construct an office building to be occupied by his own
staff. Tangible non-current assets are initially measured at cost.
Which of the following expenses incurred by the building contractor cannot be
included as a part of the cost of the office building?
7.
8.
A.
Direct building labour costs.
B.
A proportion of the contractor’s general administration costs.
C.
Hire of plant and machinery for use on the office building site.
D.
Delivery costs in getting the raw materials onto site.
Which of the following best describes the purpose of depreciation?
A.
Allocate the cost less residual value on a systematic basis over the asset’s useful
life.
B.
Write the asset down to its realisable value each period.
C.
Accumulate a fund for asset replacement.
D.
Recognise that assets lose value over time.
An investment property with a useful life of 10 years was purchased by Akorn on 1
January 20X9 for RM200,000. By 31 December 20X9 the fair value of the property had
risen to RM300,000. Akorn measures its investment properties under the fair value
model.
What values would go through the statement of profit or loss in the year?
A.
Gain: RM100,000 and Depreciation RM30,000.
B.
Gain: RM0 and Depreciation of RM30,000.
C.
Gain: RM100,000 and Depreciation of 0.
D.
Gain: RM120,000 and Depreciation of RM20,000.
9.
On 1 April 20X0 Slow and Steady Co held non-current assets that cost RM312,000 and
had accumulated depreciation of RM66,000 at this date. During the year ended 31
March 20X1, Slow and Steady Co disposed of non-current assets which had originally
cost RM28,000 and had a carrying amount of RM11,200.
Slow and Steady Co’s policy is to charge depreciation of 40% on the reducing balance
basis, with no depreciation charged in the year of disposal.
What is the depreciation charge to the statement of profit or loss for the year
ended 31 March 20X1?
10.
A.
RM66,000.
B.
RM93,920.
C.
RM98,400.
D.
RM124,800.
Gilbert took out a RM7.5 million 10% loan on 1 January 20X6 to build a new warehouse
during the year. Construction of the warehouse began on 1 February 20X6 and was
completed on 30 November 20X6. As not all the funds were needed immediately, Gilbert
invested RM2 million in 4.5% bonds from 1 January to 1 May 20X6.
What are the total borrowing costs to be capitalised in respect of the warehouse?
A.
RM22,500.
B.
RM602,500.
C.
RM625,000.
D.
RM750,000.
(Total: 20 marks)