University of Toronto Faculty of Arts and Science and Rotman School of Management RSM 220 HlS – Financial Accounting Final Examinations Duration: 3 hours Aids allowed: Hand-held, battery-operated calculator Please answer all questions on this exam paper (or in booklets, etc.) 7 questions-you must answer ALL questions. The exam consist of 20 pages FIRST NAME: _______________________ _ LAST NAME: _______________________ _ Student#: _______________ _ Following formulas are provided for your reference: Present value of a lump sum: PV= PMT (1 +rr RSM220H1S Final Exam Present value of an annuity: 1-( 1 l PV = PMT -“–(_I +_r_r PAST EXAM 1 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca d my Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 QUESTION 1 – Multiple Choice {16 marks) REQUIRED: Please answer the following questions (2 marks each) by circling only the best answer: 1. In December 2020, OnlineSales.com, a consumer promotion business was told by auditors that it was recording revenues too early. In one example, the company recognized $55,000 in cash sales prior to providing any “significant services”. The company does not offer refunds. Therefore, which of the following requirements of revenue recognition were not met a) Performance b) Measurement c) Collectability d) Both A.) and C.) e) Promotions.com met all of the elements of revenue recognition and should have recognized revenue 2. OnlineBooksiez.com is a seller of books online. The company doesn’t have stores and all customers purchase the books online. Once the company receives an order and a credit card transaction is authorized, it ships the product to the customer. Which of the following is the most conservative way of accounting for revenues a) Recognizing revenue when the product is manufactured b) Recognizing revenue when the cash is received c) Recognizing revenue under FOB shipping point sales terms d) Recognizing revenue under FOB destination sales terms 3. The discrete earnings process is one that a) Unfolds over several accounting periods. b) Includes a critical event. c) has substantial completion which can be deferred. d) must be accounted for by the percentage-completion method (i.e. in reference to stage of completion). 4. The following information is available for SuperCompany Inc (SCI): $ 8,000 400,000 Allowance for doubtful accounts at December 31, 2020 Credit sales during 2021 Accounts receivable deemed worthless and written off during 2021 9,000 As a result of a review and aging of accounts receivable in early January 2022, however, it has been determined that an allowance for doubtful accounts of $7,500 is needed at December 31, 2021. What amount should SCI record as bad debt expense for the year ended December 31, 2021 a) $6,500 b) $7,500 c) $8,500 d) $15,500 5. Which of the following goods should be included in the seller’s inventory a) Goods in transit if shipped f.o.b. shipping point b) Goods out on consignment c) Goods sold with estimable rates of return d) None of the above 6. Major characteristics of property, plant, and equipment do NOT include: a) Long-term in nature b) Usually subject to depreciation c) Acquired and held for resale d) Possess physical substance RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 7. Capitalized cost of property, plant, and equipment includes all expenditures needed to: 1) acquire the asset (purchase price) 2) bring it to its location where it is ready for use (including delivery) 3) bring it to state where it is ready for use (including installation and assembly} 4) discharge obligations associated with asset’s eventual disposal (e.g. site restoration) a) 1) and 2) only; · b) 1) and 3) only; c) 1), 2} and 3} only; d) All of them 8. With regard to borrowing costs that are incurred during acquisition, construction or production of qualifying assets, which of the following statement is FALSE a) Under IFRS, they MUST be capitalized as part of the asset’s cost; b) Under IFRS, they MUST be expensed as interest expense; c) Under ASPE, they MUST be expensed as interest expense; d) Under ASPE, they MUST be capitalized as part of the asset’s cost; RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 QUESTION 2 (21 marks) On December 31, 2020, Selling Company Inc. (SCI) sold product to Buying Company Ltd (BCL), accepting a 3%, four-year (4-year) promissory note of $400,000 in exchange. Interest is payable annually on December 31, starting December 31, 2021. SCI normally pays
6% interest to borrow funds. BCL, however, normally pays 8% to borrow
funds. The product sold is carried on SCl’s books at a manufactured cost of $255,000. Assume SCI uses the perpetual inventory system. PARTI REQUIRED:
Prepare the required journal entries for SCI to record the transaction
at December 31, 2020. Assume that the effective interest method is
used and round all values to the nearest dollar. For each component of
the journal entries, clearly state whether the entry (dr./cr.) is
made to the income statement (1/S), balance sheet (B/S) or statement of
other comprehensive income (OCI). For example, Dr. Cash (BIS) $10; Cr. Revenue (I/SJ $10. (7 marks) PART II REQUIRED:
Prepare all required journal entries for 2021 (for SCI) relating to the
sale. For each component of the journal entries, clearly state whether the entry (dr./cr.) is made to the income statement (1/S), balance sheet (B/S) or statement of other comprehensive income (OCI). For example, Dr. Cash (B/SJ $10; Cr. Revenue (I/SJ $10. (4 marks) RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca de y Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 PART Ill REQUIRED:
Prepare all required journal entries for 2024 (for SCI) relating to the
sale. For each component of the journal entries, clearly state whether the entry (dr./cr.) is made to the income statement (1/S), balance sheet (B/S) or statement of other comprehensive income (OCI). For example, Dr. Cash (B/S) $10; Cr. Revenue {I/S) $10. (4 marks) PART IV REQUIRED:
What is the pattern of interest expense in this question (i.e. is it
increasing, decreasing, or is it constant over the years) Explain why this pattern exists. (2 marks) PARVV REQUIRED:
Assume that SCI is having liquidity problems and needs to receive cash
immediately. How can they use the receivable to do so, and what is the impact on its financial statements (4 marks) RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 QUESTION 3 (19 marks) Answer
the following independent parts. For each component of the journal
entries, clearly state whether the entry (dr./cr.) is made to the
income statement (1/5), balance sheet (B/5) or statement of other
comprehensive income (OCI). ·For example, Dr. Cash (B/5) $10; Cr. Revenue (1/5) $10. PARTI Frances
Limited Inc. has a fiscal year end on June 30. Below is an inventory
purchases and sales record for the year ending on June 30, 2021. This record is maintained by the warehouse managers, and none of this information has been entered in the company’s accounting
software. The company has only one product in inventory, and all units
of that product are the identical (homogenous). Date Units Purchased Units Sold Units Balance July 1, 2020 45 (@ $100 each) February 13, 2021 30 ($130 each) February 26, 2021 45 ($125 each) March 17, 2021 80 @ $165 each April 25, 2021 70 ($145 each) May 28, 2021 30@ $185 each June 19, 2021 50@ $195 each June 30, 2021 30 a) REQUIRED: Using the FIFO Method (under perpetual inventory system), calculate the company’s cost of goods sold (COGS) for fiscal year ending June 30, 2021. Show all calculations for full marks. (S marks) b) REQUIRED: Using the FIFO Method (under perpetual inventory system), prepare the journal entry (entries) for the May 28, 2021 sale assuming cash is received. (4 marks) RSM220H1S Final Exam EZ Ac ademy Ouya ngNan a 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 PART II On June 30, 2021, the inventory of BarySound Inc. (BSI) was categorized as follows: Cost Net Realizable Value Type A $422,000 $360,000 Type B 540,000 575,000 TypeC 675,900 650,000 TypeD 471,200 475,000 Total 2,109,100 2,060,000 BSI values inventory on an item-by-item basis. REQUIRED: Prepare the needed adjusting journal entry to write down the inventory (using the allowance method). (5 marks) PART Ill On
April 15, 2021, a fire destroyed the entire uninsured inventory of a
retail store of LocalWares Ltd (LWL). The following data are available: Sales, July 1, 2020 through April 15, 2021 Inventory, July 1, 2020 Purchases, July 1, 2020 through April 15, 2021 Markup on cost $4,500,000 750,000 3,750,000 25% REQUIRED:
What
is the estimated cost of destroyed inventory, if any, at April 15,
2021 Use the Gross Profit Method of estimating inventory to support your answer and show all calculations for full marks. (5 marks) RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 QUESTION 4 (36 marks) Renfro
Corporation (RC) has a fiscal year end of December 31 and applies
straight-line depreciation to its PP&E. RC purchased $4,500,000 a building on July 1, 2020. Answer
the following independent parts. For each component of the journal
entries, clearly state whether the entry {dr./cr.) is made to the
income statement (1/S), balance sheet (B/S) or statement of other
comprehensive income (OCI). For example, Dr. Cash (B/S) $10; Cr. Revenue (1/S) $10. PARTI Suppose
the building is used as a warehouse (for production). It was estimated
that the building has a useful life of 30 years at purchase {no
residual or salvage value). RC uses a revaluation model for its PP&E
and it re-values all of its PP&E every three years to make
sure that the book values of its long term productive assets are not too
far from their market values. On December 31, 2022, the building
was estimated to have a fair value of $3,875,000. Also on December 31,
2022, RC adjusted the useful life of the building to be 25 more years. On December 31, 2025, the building was estimated to have a fair value of $3,750,000. a) REQUIRED: Prepare all journal entries needed for the revaluation on December 31, 2022. (9 marks) RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca d my Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 b) REQUIRED: Prepare all journal entries needed for the revaluation on December 31, 2025. (10 marks) RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 PART II Suppose
the building is used as a warehouse {for production). It was estimated
that the building has a useful life of 30 years at purchase (no
residual). RC uses a revaluation model for its PP&E and it re-values
all of its PP&E every three years to make sure that the book
values of its long term productive assets are not too far from their
market values. On January 1, 2022, the building was sold for $4,375,000 in order to obtain fund for a new and more upgraded warehouse and cash was received. REQUIRED:
Prepare the journal entry for the sale (assuming all the accounts
associated with the building have been kept updated on the date of sale). (8 marks) PART Ill Suppose
the building is used as a warehouse (for production). It was estimated
that the building has a useful life of 30 years at purchase (no
residual). On July 1, 2021, RC decided to discontinue a major line of
its business, and the building belongs to the discontinued
component. On December 31, 2021, the building is estimated to have a
fair value of 4,000,000 {the cost to sell it is negligible). REQUIRED: Prepare necessary journal entry {or entries) on December 31, 2021. (S marks) RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 PART IV Suppose
that the building RC purchased at $4,500,000 on July 1, 2020 was
considered as an investment property (for renting}. On December 31,
2020, the building was estimated to have a fair value of $4,875,000.
Prepare necessary journal entry (or entries) on December 31, 2020. (4 marks) RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 QUESTION 5 (8 marks) Information
Processing Inc {IPI) exchanged machinery that it uses in its
manufacturing operations for similar equipment that is used in the
operations of Cathy Company (Cathy). IPI also gave Cathy $85,000 in the
exchange. The following information pertains to the exchange: Equipment (cost) Accumulated Amortization FV of equipment Cash received (paid) IPI $2,270,000 1,170,000 920,000 (85,000) Cathy $2,560,000 1,360,000 Unknown 85,000 Assume amortization has already been updated to the date of the exchange. REQUIRED: Prepare the journal entry on IPl’s books assuming that the exchange is determined to have commercial substance. For each
component of the journal entries, clearly state whether the entry
(dr./cr.) is made to the income statement (1/S), balance sheet (B/S) or statement of other comprehensive income (OCI). For example, Dr. Cash (B/S) $10; Cr. Revenue (1/S) $10. RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 QUESTION 6 (20 marks) Peggy
Computer Company (PCC) uses the straight-line method for all
amortization and amortizes its patents over their legal life. On January 2, 2020, PCC acquired patents with remaining legal life of 15 years at a cost of $225,000. PCC calculates amortization expense from the nearest full month. At December 31, 2022, management of PCC determined that the net (undiscounted) future cash
flows that are expected from use of the patents would be $185,000, the
value in use was $175,000, the fair value (or resale value) of the patent was approximately $170,000 and disposal costs would be $10,000. PARTI Suppose PCC follows ASPE. REQUIRED: What model should PCC apply to account for the impairment of its patents Are there any Impairments to the patents Show all the calculations to support your answer. Prepare the journal entry to record the impairment if there is any. For each component
of the journal entries, clearly state whether the entry (dr./cr.) is
made to the income statement (1/S), balance sheet (B/S) or statement of other comprehensive income (OCI). For example, Dr. Cash (B/S) $10; Cr. Revenue (1/S) $10. (5 marks) PART I Suppose PCC follows IFRS. REQUIRED: What model should PCC apply to account for the impairment of its patents Are there any impairments to the patents Show all the calculations to support your answer. Prepare the journal entry to record the impairment if there is any. For each component
of the journal entries, clearly state whether the entry (dr./cr.) is
made to the income statement (1/S), balance sheet (B/S) or statement of other comprehensive income (OCI). For example, Dr. Cash (B/S) $10; Cr. Revenue (1/S) $10. (8 marks) RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca d my Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca d my Ouyan gNan 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouy n gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 PART Ill PCC
has some indefinite-life intangibles. The carrying value of these
intangibles on December 31, 2022 was $180,000. On the same day, management of PCC determined that the net (undiscounted) future cash flows that are expected from use of the intangibles would
be $185,000, the value in use was $175,000, the fair value (or resale
value) of the patent was approximately $170,000 and disposal costs would be $10,000. Suppose PCC follows ASPE. REQUIRED:
Are there any impairments to the intangibles Show all the calculations
to support your answer. Calculate the amount of impairment loss,
if there is any. For each component of the journal entries, clearly
state whether the entry (dr./cr.) is made to the income statement
(1/S), balance sheet (B/S) or statement.of other comprehensive income
{OCI). For example, Dr. cash {B/S) $10; Cr. Revenue (1/S) $10. (3 marks) PART IV REQUIRED: Will any of your answer in Part Ill change if PCC follows IFRS instead of ASPE Are there any impairments to the intangibles
Show all the calculations to support your answer. Calculate the amount
of impairment loss, if there is any. (4 marks) RSM220H1S Final Exam EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107 EZ Aca demy Ouyan gNana 4107