F1 Exam Dumps : Financial Reporting

Country X levies a duty on alcoholic drinks. Where the alcohol content is above 40% by volume the duty levied is $5 per 1 litre bottle.

What type of tax is this duty?

An entity's inventory days are 45 days.

An entity ceased to manufacture a product in 20X4. Raw materials used solely in the manufacture of that product are still held in inventory at 31 December 20X4.

Place the appropriate response below to show how inventory days will be affected if this raw material inventory is written off as obsolete.

An entity opens a new factory and receives a government grant of $25,000 towards the cost of new plant and equipment. This new plant and equipment originally costs $100,000.

The entity uses the net cost method allowed by IAS 20 Accounting for Government Grants and Disclosure of Government Assistance to record government grants of this nature. All plant and equipment is depreciated at 20% a year on a straight line basis.

Calculate the amount of depreciation to be included for this plant and equipment in the statement of profit of loss for the factory's first year of operation.

Give your answer to the nearest whole $.