None Collinsworth Limited, a U.K. company, prepares its financial statements according to International Financial Reporting Standards. Latein its 2024 fiscal year, a significant adverse change in business climate indicated to management that the assets of its appliancedivision may be impaired. The following data relate to the division's assets:Book valueUndiscounted sum of estimated future cash flowsPresent value of future cash flowsFair value less cost to sell (determined by appraisal)Required:(£ inmillions)£ 2452351701651. What amount of impairment loss, if any, should Collinsworth recognize?2 Assume that Collinsworth prepares its financial statements according to U.S. GAAP and that fair value less cost to sellapproximates fair value. What amount of impairment loss, if any, should Collinsworth recognize?Note: Enter your answers In millions (l.e., 10,000,000 should be entered as 10).1. Impairment loss2. Impairment lossmillionmillion

Impairment loss is the amount wherein the carrying amount of an asset exceeds its recoverable…

Answered: Collinsworth Limited, a U.K. company,…

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter9: Metric-analysis Of Financial Statements

Section: Chapter Questions

Problem 9.23E: Unusual income statement items Assume that the amount of each of the following items is material to...

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Collinsworth LTD., a U.K. company, prepares its financial statements according to International Financial Reporting Standards. Late in its 2021 fiscal year, a significant adverse change in business climate indicated to management that the assets of its appliance division may be impaired. The following data relate to the division’s assets: (£ in millions)Book value £220Undiscounted sum of estimated future cash flows 210Present value of future cash flows 150Fair value less cost to sell (determined by appraisal) 145 Required:1. What amount of impairment loss, if any, should Collinsworth recognize?2. Assume that Collinsworth prepares its financial statements according to U.S. GAAP and that fair value less cost to sell…
On December 31, 2022, Marizor Company believed that the assets of a cash generating unit are impaired based on an analysis of economic indicators. The assets and liabilities of the cash generating unit at carrying amount on December 31, 2022 are: Cash 4,000,000 6,000,000 1,000,000 7,000,000 22,000,000 4,000,000 Accounts receivable Allowance for doubtful accounts Inventory Property, plant and equipment Accumulated depreciation Goodwill 3,000,000 Accounts payable Loans payable The entity determined that the value in use of the cash generating unit is P28,000,000. The accounts receivable are considered collectible, except those considered doubtful. The carrying amount of the inventory is lower than fair value less cost of disposal. What is the impairment loss to be allocated to property, plant and equipment? 2,000,000 1,000,000 A. 3,600,000 В. 6,000,000 С. 3,000,000 D. 1,800,000
ABC Company’s statement financial statement shows a deficit on retained earningsamounting to P260,000. To eradicate the said deficiency, the company was to authorized bythe commission to have the revaluation of its assets and liabilities. The following were therevaluation:a. The receivable balance will be decreased to P40,000.b. The total fixed assets from its book value of P1,900,000 shall be revalued for P1,500,000and the P700,000 accumulated depreciation attached from the original book value shall bezero out.c. P50,000 of the other liabilities account shall not be recognized.Required:a. Prepare the necessary entries for the revaluation of assets and liabilities in the quasireorganization activity.b. Prepare the statement of financial position as of January 1, 2020 after the revaluationprocess.
XYZ Corp. is a manufacturer of generators. The domestic market for this products is currently not doing well, and therefore many entities in this business are switching to export. As per audited financial statements for the year ended December 31, 2021, the entity had a net loss of P 2,000,000. At December 31, 2021, its current assets aggregate to P 20,000,000 and current liabilities aggregate to P 25,000,000. Due to expected favorable changes in the government policies for this industry, the entity is projecting profits to the coming year. Furthermore, the shareholders of the entity have arranged alternative additional sources of financing for its expansion plans and to support its working capital requirements in the next 12 months. Should ABC Corp. prepare its financial statements under the going concern assumption? Explain.
The fact that generally accepted accounting principles allow companies flexibility in choosing between certain allocation methods can make it difficult for a financial analyst to compare periodic performance from firm to firm. Suppose you were a financial analyst trying to compare the performance of two companies. Company A uses the double-declining-balance depreciation method. Company B uses the straight-line method. You have the following information taken from the 12/31/2024 year-end financial statements for Company B: Income Statement Depreciation expense Balance Sheet Assets: Plant and equipment, at cost Less: Accumulated depreciation Net $ 13,500 $ 135,000 (54,000) $ 81,000 You also determine that all of the assets constituting the plant and equipment of Company B were acquired at the same time, and that all of the $135,000 represents depreciable assets. Also, all of the depreciable assets have the same useful life and residual values are zero. In order to compare performance…
The fact that generally accepted accounting principles allow companies flexibility in choosing between certain allocation methods can make it difficult for a financial analyst to compare periodic performance from firm to firm. Suppose you were a financial analyst trying to compare the performance of two companies. Company A uses the double-declining-balance depreciation method. Company B uses the straight-line method. You have the following information taken from the 12/31/2024 year-end financial statements for Company B: Income Statement Depreciation expense $ 11,500 Balance Sheet Assets: Plant and equipment, at cost Less: Accumulated depreciation (46,000) $ 69,000 Net $ 115,000 You also determine that all of the assets constituting the plant and equipment of Company B were acquired at the same time, and that all of the $115,000 represents depreciable assets. Also, all of the depreciable assets have the same useful life and residual values are zero. Required: 1. In order to compare…
Hello, I'm having issues with the books problem questions. The problem is looking for the "Goodwill" If the method is needed, we've been told to use Fair value method.
Please refer to the picture below for information. Kindly use a Table in showing the complete solution. Thank you so much. Question: What is the impairment loss to be allocated to Inventory? a. P717,391.30 b. P513,157.89 c. P204,233.41 d. P0
Please do not give solution in image format ?.
Lenexa State Bank has followed the practice of capitalizing certain marketing costs and amortizing these costs over their expected life. In the current year, the bank determined that the future benefits from these costs were doubtful. Consequently, the bank adopted the policy of expensing these costs as incurred. How should the bank report this accounting change in the comparative financial statements?
The following financial information relate to Lang Industrial Systems Inc. and as a financial analyst you are required to assist with the following problems: Assets Current Assets Cash Accounts Receivable Inventory Total Current Assets Fixed Assets Property, Plant, and Equipment Less Accumulated Depreciation Net Fixed Assets Total Assets Balance Sheet ($ in Millions) 2022 2021 540 820 550 950 174 776 400 Total Current Liabilities 1910 1400 Long-Term Liabilities Long-Term Debt Total Long- Term Liabilities Owners' Equity 2686 600 400 800 100 700 Liabilities and 2022 2021 Owners' Equity 2100 Current Liabilities Accounts Payable Notes Payable Common Stock ($1 Par) Retained Earnings Total Owners' Equity Total Liab. and Owners' Equity 1120 810 460 1580 431 431 340 335 675 2686 370 1180 440 440 310 170 480 2100 Income Statement ($ in Millions) 2022 Sales Cost of Goods Sold Administrative Expenses Depreciation Earnings Before Interest and Taxes Interest Expense Taxable income Taxes Net Income…
Layla Corp. is preparing its statement of cash flows for the year ended Dec. 31, 2021 and has provided the following information: Profit before income tax Depreciation on property, plant and equipment Provision for impairment losses Unrealized foreign exchange gains Fair value adjustment gain on FA at FVTPL Fair value adjustment loss on FA at FVTOCI Fair value adjustment loss on investment property Share of profit of associate Gain on sale of FA at AC Loss on sale of equipment Gain on debt extinguishment Gain on distribution of non-cash assets to owners Interest expense Interest payable, beginning of the year Interest payable, end of the year Interest income P880,000 250,000 150,000 60,000 130,000 65,000 190,000 220,000 85,000 70,000 125,000 40,000 150,000 100,000 50,000 80,000 30,000 20,000 Interest receivable, beginning of the year Interest receivable, end of the year Income taxes paid Accounts receivable, beginning of the year Accounts receivable, end of the year Inventory,…

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