mi :1 '3 55 % I'D 2155 e ACCZA2016te... IE] lg 2015 Property. plant and equipment 540 000 Investment in subsidiary 260 000 Other nanciat assets 45 000 Debtors 267 000 Inventories 265 000 Cash (including bank overdraft) 23 000 1 400 000 Ordinary share capital 200 000 Redeemable 10% preference share capital 200 000 Retained earnings 100 000 Long -terrn loan (R50 000 payable in the next nancial year) 650 000 Creditors 250 000 W REQUIRED: a) Identify the problems in the statement of nancial position presented to you and provide the required correct accounting treatment in terms of the Conceptual Framework and IAS 1 Presentation of nancial statements (1 0) PART B (10 MARKS) Due to the outbreak of the Vike virus the research department of Phan'n Ltd decided to develop a vaccine that will be administered to those In affected areas. Research into possibilities for the vaccine began on 1 January 2015. Ely 31 May 2015. R300 000 worth of research costs had been Incurred by the research team. Development costs of R100 000 were incurred on 1 June 2015. On 1 July 2015. the date on which the recognition criteria for capitalisation of development costs were met, R200 000 was spent to develop the vaccine. In addition. R50 000 of legal costs were incurred to register the legal rights to the vaccine. Capitalieed development costs of this nature are amortised over 5 years. REQUIRED: a) Journallse the above in the general Journal of Phami Limited for the reporting period ended 31 December 2015. (10) COURSE: ACCOUNTANCY IlA \"51-92-2016 QUES'HON 2 (CONTINUED) Finance costs on the loan for the following periods are as follows: R 1 June 2012 - 1 January 2015 65 000 1 August 2012-1 January2015 54 000 1 August 2012 -1 March 2015 66 000 Depreciation for the manufacturing plant is calculated using the straight line method over a period of 20 years. ADDITIONAL INFORMATION: 1) The useful life of the buildings is estimated at 20 years. It is the policy of the company to depreciate buildings over the expected useful life using the streightline method. 2) A swom appraiser. who has experience with similar properties. has placed the following fair value on the properties at 31 March 2015: R Building A 17 000 000 Building B 495 000 3) The components of the vehicle can function independently. but are used as a unit. Components are independently replaced at the end of their useful lives. Parts cannot be realized independently at the and of their useful life. 4) Unless stated otherwise all amounts exclude VAT. 5) Amounts should be rounded to the nearest Rand. REQUIRED: Disclose the following notes in the financial statements of H&N Ltd for the reporting period ended 31 March 2015: - Property. Plant and Equipment - Investment Property {551