PPE (Q2)

Question 1

RECOGNITION CRITERIA

Answer 1

RELEVANT
-the transaction satisfies the definition of asset
-high potential of future economic benefit flow to the entity

FAITHFUL REPRESENTATION
measurement is certain and evidenced

Question 2

DISPOSAL OF ASSET

Answer 2

-THE COST OF THE EQUIPMENT RM X AND THE ACC DEP RM X ARE DERECOGNISE FROM THE COMPANY’S BOOK

-THE CA OF RM X WILL BE DERECOGNISE FROM SOFP

-THE SALES PROCEED RECEIVED RM X INCREASE THE COMPANY’S BANK

-THE loss OR gain ON DISPOSAL WILL BE TREATED AS EXPENSES IN SOPL

Question 3

ASSET

Answer 3

-PAST EVENT (TRANSACTION)
-RIGHT TO USE
-RESOURCES CONTROLLED BY THE ENTITY
(the asset is used at the company discretion
-POTENTIAL TO PRODUCE ECONOMIC BENEFIT THAT WILL GENERATE MORE SALES TO THE CO.

Question 4

MFRS116

Answer 4

YES IT IS TANGIBLE ASSET
IT WAS HELD FOR (?)
MORE THAN ONE ACCOUNTING PERIOD, X YEARS USEFUL LIFE

Question 5

DERECOGNITION

Answer 5

-THE STANDARD REQUIRES THAT THE CARRYING AMOUNT OF AN ITEM PPE SHALL BE DERECOGNISED
-ON DISPOSAL
-WHEN NO FUTURE ECONOMIC BENEFITS ARE EXPECTED FROM ITS USE OR DISPOSAL
-THE (ASSET) CAN BE DERECOGNISED FROM THE ACCTNG RECORDS ON (DATE) AS THE CO. SOLD THE ASSET.

Question 6

REVENUE EXPENDITURE

Answer 6

-FOR MAINTAIN THE CURRENT LEVEL OF FUTURE ECONOMIC BENEFIT
-ALL COST (EXAMPLE COST) INCCURED REGARDED AS REVENUE EXPENDITURE
-FOR MAINTAIN THE CURRENT LEVEL OF FUTURE ECONOMIC BENEFIT
-SHOULD BE RECOGNISED IN SOPL AS EXPENSES

Question 7

REVALUATION

Answer 7

-ADJUST THE GROSS CARRYING AMOUNT RM X (CARRY AMOUNT) OF THE ASSET BY
RM X (COST-CA) TO REFLECT ITS NEW VALUE RM X (NEW COST)
-RECOGNISE THE REVALUATION SURPLUS OF
RM X (COST-CA) IN OTHER COMPRENHENSIVE INCOME AND CREDITED TO ARR
-THE REVALUED AMOUNT RM X (NEW COST) IS RECOGNISED IN SOFP.