MGT401 Current Final Term Fall 2013 Shared by Iftikhar Mughal File 4

52 MCQs and 8 long questions. Little tough for me.

Long questions are below.

A customer was considered doubtful at the Balance Sheet date. A provision for such customer was made @ 50%. After the Balance Sheet date, customer was declared as insolvent based on his financial position on year end.

Required:

Identify the type of event

What will be the accounting treatment?

According to IAS, which items shall be disclosed on the face of the Income Statement as allocations to profit or loss for the period?

What are the major classifications of expenses in which the expenses have been distributed for presentation in Income Statement?

Suppose a company has a:

Partially completed inventory item at the year end.

Expected selling price of the item when completed is Rs. 2,600.

A further cost of Rs. 500 is required to complete the item

Expected selling cost of the item is Rs. 100

Required:

What will be the carrying value of the inventory item if the cost incurred to date is Rs. 1,500?

2- What will be the carrying value of the inventory item if the cost incurred to date is Rs. 2,500?

List down the items that should be included in Cash flows from operating activities?

If:

Depreciation expenses                                    Rs. 1,000

Purchases of materials                         Rs. 2,000

Amortization costs                              Rs. 3,000

Employees benefits costs                    Rs. 4,000

Transport costs                                                Rs. 5,000

Cost of sales                                        Rs. 6,000

Distribution costs                                Rs. 7,000

Then:

Calculate the total amount of expenses with respect to their nature.

If:

   ABC Limited acquired “Material X” in place of “Material Y” from XYZ Limited.

Particulars	Rs.
Fair value of “Material X”	50,000
Fair value of “Material Y”	60,000
Cash paid by XYZ Limited	10,000

Then:

        Pass Journal Entries in the books of both the parties.

Identify the type of lease. Also give reason:                         

a)                  A ltd. Co. acquired the asset on lease; fair value of the asset is Rs. 50,000. The company has no intention to buy it at the end of lease term. The present value of minimum lease payments is Rs. 46,000

b)                  B ltd. Co. acquired the asset on lease; the asset is of such a special nature that no other company uses such type of asset without major modifications.