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The standard does apply to property, plant, and equipment used to develop
or maintain the last three categories of assets. [IAS 16.3]
The standard does apply to bearer plants but it does not apply to the
produce on bearer plants. [IAS 16.3]
IAS 16 does not prescribe the unit of measure for recognition – what
constitutes an item of property, plant, and equipment. [IAS 16.9] Note,
however, that if the cost model is used (see below) each part of an
item of property, plant, and equipment with a cost that is significant in
relation to the total cost of the item must be depreciated separately.
[IAS 16.43]
2. Initial Measurement
Additional Disclosures
DESCRIPTION OF GAMES
1. Spinner,
2. Karma
3. Ular Tangga
Firstly, the spinner will be spin to determine the player’s number who will
participate and answer the question. Each question has their own point. For those
can answer the question will get the score based on the point. Then, the player
can run the “avatar” on Ular Tangga . If the player is lucky, they can boost their
score through the stairs. Otherwise, the player will lose their score if they meet
the snake.
QUESTION PLAN
6. If investment property is measured using the fair value model, a gain arising
from a change in the fair value of an investment property must be:
a. Recognised in the calculation of profit or loss
b. Recognised as other comprehensive income
c. Credited to a revaluation reserve
d. Recognised in balance sheet
WDV at the end of 2015 is £22,500 (75% of £30,000), so depreciation in 2016 is £5,625 (25% of
£22,500). This is equal to 21.63% of the item's depreciable amount, so income of £1,298 (21.63% of
£6,000) is recognised in the year to 31 December 2016.
8. When an asset is sold or disposed of, where is the gain or loss recognised?
a. Asset disposal account
b. Profit and loss
c. Revaluation reserve
d. Depreciation
9. Under IAS 16, if an asset is not used then…
a. Depreciation is paused
b. Depreciation for the entire period does not apply
c. Depreciation continues
d. Depreciation is ignored
10. What is the amount an asset could achieve if sold between knowledgeable,
willing parties in an arms length transaction?
a. Current value
b. Net present value
c. Written down value
d. Fair value
11. If an asset increases in value, the increase is noted as…
a. An increase in net profit in the SOCI
b. An increase in revaluation surplus in the SOFP and other comprehensive
income in the SOCI
c. An increase in retained earnings in SOFP
d. An increase in “other profit” in SOCI
12. Under IAS 16, which two subsequent accounting treatments are allowed
subsequently to initial recognition?
a. Cost model and present value model
b. Cost model and revaluation model
c. Fair value model and revaluation model
d. Fair value model and cost model
13. What is the amount an asset is recognised at in the Statement of Financial
Position less any accumulated depreciation or impairment losses?
a. Carrying amount
b. Residual value
c. Impairment amount
d. Fair value
14. How should an asset be initially recognised in the financial statements?
a. Measure at market value
b. Measure at cost
c. Measure at net realisable value
d. Measure at fair value
15. What is an impairment loss?
a. The amount by which the carrying amount of an asset exceeds the
recoverable amount
b. The amount by which the market value of an asset exceeds the net present
value
c. The difference between the fair value of an asset and the net realisable value
of the asset
d. The amount by which the carrying amount of an asset exceeds the book value
16. Which of the following is covered by IAS 16 – Property, Plant and Equipment?
a. Assets held for sale
b. Biological assets related to development activity
c. Exploration assets
d. Office buildings
17. A company purchases land with an office building. The building has a useful life
of 20 years. How should the land be depreciated?
a. Depreciate over 20 years
b. Depreciate over useful life of the land
c. Don’t depreciate the land
d. Depreciate every year
Land has indefinite/unlimited useful life
18. When an item of property, plant and equipment is revalued, what should be
revalued?
a. A selection of assets decided by management
b. The whole class of assets to which it belongs
c. The individual asset
d. A selection of assets picked at random
The whole class of assets to which it belongs should be revalued. This prevents a mixture of cost
and values appearing in the financial statements. It also prevents management from picking only
the best assets to revalue.
19. Which of the following is not an asset that falls under the scope of IAS 16?
a. Tangible assets
b. Assets held for the production or supply of goods or services
c. Assets held for sale in the normal course of business
d. Assets expected to be used for more than one period
Assets, which are held for sale in the normal course of business, are accounted for using IAS 2 –
Inventories
When it is probably that future economic benefits associated with an asset will flow to the entity,
and the costs can be reliably measured, it should be recognised as an asset.
20. Under IAS 16, how often should the useful life of an asset be reviewed?
a. At least at each financial year end
b. Every six months
c. At management’s discretion
d. Every year