GroWell Plantation Bhd (GPB) is a public limited company and has commenced business in Malaysia for...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
GroWell Plantation Bhd (GPB) is a public limited company and has commenced business in Malaysia for more than 40 years. GPB currently owns and manages oil palm estates with a total plantation acreage of 9,000 acres in the state of Pahang, Malaysia. The harvesting process is continuously throughout the financial year to be used in the production of crude palm oil (CPO). GPB has two types of inventories, oil palm fruits and CPO. The financial statements of GPB are prepared under the historical cost convention, except for investment in subsidiaries and biological assets (including agricultural produce) that are measured at revalued amounts of fair values at the end of each reporting period. For the biological assets, fair value is determined based on the present value of expected net cash flows from the assets, while the fair value of agricultural produce is generated from the quoted price from the active market. Below are the incomplete notes to the financial statements for biological assets for the year ended 31 December 2020.< 2 Notes to the financial statements: 10. BIOLOGICAL ASSETS At valuation At 1 January Fair value gain/(loss) At 31 December 2020 (RM) a be 2019 (RM) 1,054,212 (377,256) 676,956 2 2 4 The fair value and cost to sell of the biological assets for the year ended 2020 was RM850,000 and RM98,262, respectively. REQUIRED: (a) →→ Explain why GPB uses a discounted cash flow model to determine the fair value of biological assets. (b) → Determine the value of a, b and c that are missing in the notes to the financial statements. (c) → Prepare the journal entries to record the fair value gain or loss in 2019 and 2020 for GPB according to MFRS 141 Agriculture.< GroWell Plantation Bhd (GPB) is a public limited company and has commenced business in Malaysia for more than 40 years. GPB currently owns and manages oil palm estates with a total plantation acreage of 9,000 acres in the state of Pahang, Malaysia. The harvesting process is continuously throughout the financial year to be used in the production of crude palm oil (CPO). GPB has two types of inventories, oil palm fruits and CPO. The financial statements of GPB are prepared under the historical cost convention, except for investment in subsidiaries and biological assets (including agricultural produce) that are measured at revalued amounts of fair values at the end of each reporting period. For the biological assets, fair value is determined based on the present value of expected net cash flows from the assets, while the fair value of agricultural produce is generated from the quoted price from the active market. Below are the incomplete notes to the financial statements for biological assets for the year ended 31 December 2020.< 2 Notes to the financial statements: 10. BIOLOGICAL ASSETS At valuation At 1 January Fair value gain/(loss) At 31 December 2020 (RM) a be 2019 (RM) 1,054,212 (377,256) 676,956 2 2 4 The fair value and cost to sell of the biological assets for the year ended 2020 was RM850,000 and RM98,262, respectively. REQUIRED: (a) →→ Explain why GPB uses a discounted cash flow model to determine the fair value of biological assets. (b) → Determine the value of a, b and c that are missing in the notes to the financial statements. (c) → Prepare the journal entries to record the fair value gain or loss in 2019 and 2020 for GPB according to MFRS 141 Agriculture.<
Expert Answer:
Answer rating: 100% (QA)
ANSWER EXPLANATION a Biological asset cow Agricultural produce beef Bearer plants rubber trees ... View the full answer
Related Book For
Managerial Accounting Decision Making and Performance Management
ISBN: 978-0273764489
4th edition
Authors: Ray Proctor
Posted Date:
Students also viewed these accounting questions
-
Question 1 What should you do to raise a concern about a suspected ethics violation? Ask another colleague at KPMG to report your concern. Wait and see if the behavior or action occurs again. It may...
-
From the following, calculate net cash flows from financing activities: Payments of dividends ......... $ 16,000 Issuance of common stock ....... 3,000 Issuance of long-term note ....... 17,075
-
From the following, calculate net cash flows from financing activities: Payments of dividends.$ 7,000 Issuance of common shares.. 2,500 Issuance of long-term note 16,000
-
The homogeneous rectangular block having dimensions a-1.93, b=2.75 as shown, and mass m, rests on the inclined plane which is hinged about a horizontal axis through O. Calculate the minimum value of...
-
Should the First Amendment protect corporate political expression? If not, where should the line be drawn for corporations between freedom and restrictions? Should First Amendment protections apply...
-
Redraw Fig. 2-2 adding two new states: New and Terminated. When a process is created, it is initially in the New state. When it exits, it is in the Terminated state. Blocked Running 2 Ready 1....
-
Determine the slope at the end \(B\) of the A-36 steel beam. \(I=80\left(10^{6} ight) \mathrm{mm}^{4}\). A 8 m 6 kNm
-
Translate a trial balance and prepare a consolidation worksheet with excess of cost over book value traceable to equipment. Due to increasing pressures to expand globally, Pueblo Corporation acquired...
-
IMF Distribution, Inc had Retained Earnings of $4,925 at the beginning of the year. At the end of the year, the Retained Earnings account balance is $5,498. The Net Income for the year is $938. What...
-
The received signal in a digital base band system is either +A or -A, equally likely, for T-second contiguous intervals. However, the timing is off at the receiver so that the integration starts...
-
A straight pipe ABCD is 15 m long, with three equal length sections. AB and CD are of uniform diameter and the diameter of BC tapers uniformly from 150 mm at B to 100 mm at C. Oil of relative density...
-
Kubin Company s relevant range of production is 2 4 , 0 0 0 to 3 1 , 0 0 0 units. When it produces and sells 2 7 , 5 0 0 units, its average costs per unit are as follows: Average Cost per Unit Direct...
-
How do Reports and Proposals leverage empirical evidence to substantiate assertions and foster persuasive discourse ?
-
Antaplu is committed to its quality program: it works with all areas of the company establish sound quality programs within reasonable budget guidelines. For 2 0 1 3 , it has budgeted $ 1 . 0 0 0 , 0...
-
On December 3 1 , 2 0 X 1 , certain account balances at Galaxy Company were as follows before year - end adjustments: Accounts Receivable $ 1 , 8 7 0 , 0 0 0 Allowance for Uncollectible Accounts (...
-
Miller Company s contribution format income statement for the most recent month is shown below: Total Per Unit Sales ( 4 5 , 0 0 0 units ) $ 4 0 5 , 0 0 0 $ 9 . 0 0 Variable expenses 2 7 0 , 0 0 0 6...
-
In the early 19703, cable services were required to provide publicaccess channels to local residents and later were required to provide PEG channels (Public, Educational, and Government). Discuss at...
-
5. How much would you need to deposit in an account now in order to have $5,000 in the account in 5 years? Assume the account earns 2% interest compounded monthly. 10. You deposit $300 each month...
-
The Concord Toy Company has two separate strategic business units. A draft plan, incorporating a target return on capital employed (ROCE) of 20% per annum, has been created by the managing director....
-
Elbo Ltd makes roof tiles. It has two production departments: moulding and packing. It makes two different sizes of tile, the Handi and the Jiant. The following table shows the standard costs of...
-
Binley Blades specializes in the manufacture of rotor blades for helicopters. It has just spent 50,000 developing a new type of blade based on a mixture of carbon fibre and naturally occurring...
-
In one area along the interstate, the number of dropped wireless phone connections per call follows a Poisson distribution. From four calls, the number of dropped connections is...
-
The daily number of accidental disconnects with a server follows a Poisson distribution. On five days \[\begin{array}{lllll}2 & 5 & 3 & 3 & 7\end{array}\] accidental disconnects are observed. (a)...
-
Refer to Exercise 7.12. (a) Obtain the maximum likelihood estimates of \(\mu\) and \(\sigma\). (b) Find the maximum likelihood of the probability that the next run will have a production greater than...
Study smarter with the SolutionInn App