Chic Paint Ltd
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CBA Sample assessment model answers
Financial Statements (FSTM)
Sample assessment 2
Task 1 (33 marks)
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Task 2 (7 marks)
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Task 3 (7 marks)
(a)
Going Concern.
The assumption of going concern is that a company will continue in operational existence for the foreseeable future. Hence, it is assumed that the entity has neither the intention, nor the need to liquidate or curtail materially the scale of its operations; if such an intention or need exists, the financial statements may have to be prepared on a different basis and, if so, the basis used is disclosed.
(b)
Historical cost.
Assets are recorded at the amount of cash or cash equivalents (price) paid or the fair value of the consideration given to acquire them at the time of their acquisition. Liabilities are recorded at the amount of proceeds received in exchange for the obligation , or in some circumstances at the amount of cash or cash equivalents expected to be paid to satisfy the liability in the normal course of business.
Current cost.
Assets are carried at the amount of cash or cash equivalents that would have to be paid if the same or an equivalent asset was acquired currently. Liabilities are carried at their settlement values; that is, the undiscounted amounts of cash or cash equivalents expected to be paid to satisfy the liabilities in the normal course of business .
Realisable (settlement) value.
Assets are carried at the amount of cash or cash equivalents that could currently be obtained by selling the asset in an orderly disposal. Liabilities are carried at their settlement values, that is, the undiscounted amounts of cash or cash equivalents expected to be paid to satisfy the liabilities in the normal course of business .
Present value.
Assets are carried at the present discounted value of the future net cash inflows that the item is expected to generate in the normal course of business....
Financial Statements (FSTM)
Sample assessment 2
Task 1 (33 marks)
[pic]
Task 2 (7 marks)
[pic]
Task 3 (7 marks)
(a)
Going Concern.
The assumption of going concern is that a company will continue in operational existence for the foreseeable future. Hence, it is assumed that the entity has neither the intention, nor the need to liquidate or curtail materially the scale of its operations; if such an intention or need exists, the financial statements may have to be prepared on a different basis and, if so, the basis used is disclosed.
(b)
Historical cost.
Assets are recorded at the amount of cash or cash equivalents (price) paid or the fair value of the consideration given to acquire them at the time of their acquisition. Liabilities are recorded at the amount of proceeds received in exchange for the obligation , or in some circumstances at the amount of cash or cash equivalents expected to be paid to satisfy the liability in the normal course of business.
Current cost.
Assets are carried at the amount of cash or cash equivalents that would have to be paid if the same or an equivalent asset was acquired currently. Liabilities are carried at their settlement values; that is, the undiscounted amounts of cash or cash equivalents expected to be paid to satisfy the liabilities in the normal course of business .
Realisable (settlement) value.
Assets are carried at the amount of cash or cash equivalents that could currently be obtained by selling the asset in an orderly disposal. Liabilities are carried at their settlement values, that is, the undiscounted amounts of cash or cash equivalents expected to be paid to satisfy the liabilities in the normal course of business .
Present value.
Assets are carried at the present discounted value of the future net cash inflows that the item is expected to generate in the normal course of business....