Chronicle Ltd produces a range of vitamins and other 'health care' products. The end of the reporting period for Chronicle Ltd is 30 June 2024. Since that date, the following events have taken place:

1. On 18 August 2024, Chronicle Ltd paid a damages claim of $88 million to a group of consumers that had their health compromised by one of the company's products. The consumer claim was originally made in December 2023.
2. On 26 September 2024, a manufacturing plant in Cairns, Queensland was damaged by Cyclone Fibs. The damage caused amounted to $57 million of which $5 million was covered by building insurance.
3. On 7 October 2024, Chronicle Ltd issued debentures to the value of $32 million to the public to fund the purchase of new equipment damaged by the cyclone.

Events 1, 2 and 3 are all deemed to be material and the accounts were authorised after 7 October 2024.

 

Required:

How would each event 1, 2 & 3 be accounted for in the books of Chronicle Ltd for the year ended 30 June 2024?

Answer rating: 100% (QA)

To account for the events in the books of Chronicle Ltd for the year ended 30 June 2024 we can use t... View the full answer