FAC3761 NOVEMBER 2021 EXAM MEMO

OCTOBER –
NOVEMBER
2021


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, SOLUTION 1
(a) Notes to the Financial Statements of Beauty Vision Ltd for the year ended 31
December 2020

1. Property, Plant & Equipment

Land Building Total
R R R
Carrying amount at beginning of year 2 580 000 4 237 750 6 817 750
Cost / Gross Carrying amount (𝐶1) 2 580 000 4 370 000 6 950 000
Accumulated Depreciation (𝐶1) - (132 250) (132 250)

Revaluation (2 630 000 − 2 580 000) 50 000 - 50 000
Depreciation for the year (𝐶1) - (58 318) (58 318)
Carrying amount at end of year 2 630 000 4 179 432 6 809 432
Cost 2 630 000 4 370 000 7 000 000
Accumulated Depreciation - (190 568) (190 568)


Calculations

C1. Building

R
Cost (𝟒 𝟒𝟎𝟎 𝟎𝟎𝟎 + 𝟓𝟎 𝟎𝟎𝟎 − 𝟖𝟎 𝟎𝟎𝟎) 4 370 000
(4 370 000 − 2 300 000) 23
Accumulated Depreciation at beginning of year [ ∗ ] (132 250)
30 12
Carrying amount at beginning of year 4 237 750
12
Depreciation for the year [(4 237 750 − 2 600 000) ∗ ] (58 318)
337
4 179 432



(b) BeautyVision Ltd

General Journal

DR CR
R R
Revaluation Surplus (OCI) (50 000 ∗ 22.4%) 11 200
Deferred Tax (SFP) 11 200




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