The following information pertains to Monday Limited (ML): (i) The balances of property, plant and equipment...

  

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The following information pertains to Monday Limited (ML): (i) The balances of property, plant and equipment as on 1 January 2018: Cost/Revalued amount Assets Office building Equipment 240 190 Accumulated depreciation Rs. in million 36 60 Revaluation surplus related to the office building as at 1 January 2018 amounted to Rs. 8.5 million. On 1 September 2018, a new equipment was acquired by making payment of Rs. 70 million to the supplier. An old equipment was also given in exchange to the supplier. The fair values of the old and new equipment were assessed at Rs. 21 million and Rs. 93 million respectively. The old equipment had been acquired at a cost of Rs. 40 million on 1 July 2016. Cost incurred on installing the new equipment amounted to Rs. 5 million. (iii) On 1 January 2018, ML commenced construction of a manufacturing plant. The whole process of assembling and installation was completed on 31 October 2018. However, the work was stopped from 16 to 31 August 2018 due to unexpected rains. Payment date 1 February 2018 1 April 2018 1 September 2018 1 December 2018 The total cost of Rs. 660 million incurred on the plant was paid as under: Rs. in million 140 Description 1st payment 2nd payment 3rd payment 4th payment 214 146 160 The plant was financed through a bank loan of Rs. 500 million obtained on 1 March 2018. The loan carries a mark-up of 18% payable annually. The surplus funds available from the loan were invested in a saving account and earned Rs. 17 million during capitalization period. (iv) On 31 December 2018, the revalued amount of office building was assessed at Rs. 178 million by Precise Valuers, an independent valuation firm. Value in use of the office building as at 31 December 2018 was estimated at Rs. 186 million. (v) Other relevant details are as follows: Depreciation method Assets Straight line Office building Equipment Manufacturing plant Reducing balance Straight line * Remaining life at the date of last revaluation Life/rate 20 years* 20% 15 years Subsequent measurement Revaluation Cost Cost ML accounts for revaluation on net replacement value method and transfers the maximum possible amount from revaluation surplus to retained earnings on an annual basis. Required: In accordance with IFRSs, prepare a note on 'Property plant and equipment' for inclusion in ML's financial statements for the year ended 31 December 2018. (Comparatives figures and column for total are not required) The following information pertains to Monday Limited (ML): (i) The balances of property, plant and equipment as on 1 January 2018: Cost/Revalued amount Assets Office building Equipment 240 190 Accumulated depreciation Rs. in million 36 60 Revaluation surplus related to the office building as at 1 January 2018 amounted to Rs. 8.5 million. On 1 September 2018, a new equipment was acquired by making payment of Rs. 70 million to the supplier. An old equipment was also given in exchange to the supplier. The fair values of the old and new equipment were assessed at Rs. 21 million and Rs. 93 million respectively. The old equipment had been acquired at a cost of Rs. 40 million on 1 July 2016. Cost incurred on installing the new equipment amounted to Rs. 5 million. (iii) On 1 January 2018, ML commenced construction of a manufacturing plant. The whole process of assembling and installation was completed on 31 October 2018. However, the work was stopped from 16 to 31 August 2018 due to unexpected rains. Payment date 1 February 2018 1 April 2018 1 September 2018 1 December 2018 The total cost of Rs. 660 million incurred on the plant was paid as under: Rs. in million 140 Description 1st payment 2nd payment 3rd payment 4th payment 214 146 160 The plant was financed through a bank loan of Rs. 500 million obtained on 1 March 2018. The loan carries a mark-up of 18% payable annually. The surplus funds available from the loan were invested in a saving account and earned Rs. 17 million during capitalization period. (iv) On 31 December 2018, the revalued amount of office building was assessed at Rs. 178 million by Precise Valuers, an independent valuation firm. Value in use of the office building as at 31 December 2018 was estimated at Rs. 186 million. (v) Other relevant details are as follows: Depreciation method Assets Straight line Office building Equipment Manufacturing plant Reducing balance Straight line * Remaining life at the date of last revaluation Life/rate 20 years* 20% 15 years Subsequent measurement Revaluation Cost Cost ML accounts for revaluation on net replacement value method and transfers the maximum possible amount from revaluation surplus to retained earnings on an annual basis. Required: In accordance with IFRSs, prepare a note on 'Property plant and equipment' for inclusion in ML's financial statements for the year ended 31 December 2018. (Comparatives figures and column for total are not required)

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Notes to the Financial Statements Property plant and equipment 1 General i The balances of property plant and equipment as at 1 January 2018 were as follows Cost or revaluation Accumulated Amount depr... View the full answer