CS1 ACC702

questions attached below

Question 1: Intangible Amt [ 3 Marks] Brilliant Ltd acquires copyrights to the original recordings of a famous singer. The agreement with the singer allows the company to record and re-record the singer for ve years. During the initial six month period of the agreement, the singer is very sick and consequently cannot record. The studio time that the company blocked had to he paid even during the period the singer could not sing. The following are the roost: were Incurred by the company: A. Legal cost of acquiring the copyrights 511million 3. Operational loss l[studio time lost, etc.}| during startup period $3 million (2. Massive advertising campaign to launch the artist 51 million ltegulred: Discuss which of the above cost from [iiiC] is eligible to be recognized as an intangible asset using IRS 33? Question 2: Business combination [ 5 Marks] [in ilst December EUED, Grapefruit Ltd acquired the following assets and liabilities of Lime Ltd. Elrryin Amount m {lash zopop mono Receivables Seem Pram. Plantar-e Equipment @ eeeuntePet-ehle In exchange for these assets and liabilities, Grapefruit Ltd issued l shares that have been issued for $1.31] per shares but at 1st December ZDEU, had a fair value of $5.50 per share. Required: I. Prepare the acquisition analysis using IFRS 3 II. Prepare the journal entries in the records of the Grapefruit Ltd account to acquire the assets and liabilities of Lime Ltd. III. Prepare the acquisition anal-{sis assuming that the fair value of the shares was 53.30 per share Question 3: Impairment Assets [7 Marks] Max Lid acquired all the assets and liabilities of Topaz Lid on 1st January 2020. Topaz Ltd's activities were run through three separate businesses: Amethyst Unit, the Sapphire Unit, and the Emerald Unit. These units are separate cash-generating units. Max Ltd allowed unit managers to operate each unit effectively, while some central activities were run through the cooperate office. Each unit was allocated a share of the goodwill acquired and a share of the corporate office. On 31st December 2020, the assets allocated to each unit were as follows: Amethyst ($) Sapphire ( $) Emerald ( $) Factory 920 750 480 Accumulated (420) (380) (340) depreciation Land *200 * *300 *150 Plant 350 410 650 Accumulated (80) (320) (340) depreciation Inventory 220 82 *105 Goodwill 40 50 30 Corporate property 210 160 120 Additional Information:Additional Information: *these assets have carrying amount less than fair value less costs to sell. **this asset has a fair value less costs to sell of $293. Max Ltd determined the value in use of each of the business units on 31st December 2020. Amethyst $ 1185 Sapphire $950 Emerald $900 Required: Using IAS 36: Determine how Max Ltd should allocate any impairment loss on 31st December 2020