Accounting Studyguides, Study notes of Law

Download Accounting Studyguides and more Study notes Law in PDF only on Docsity!

PAS 16 , PFRS 13 Prcpeily, Plait &. Equipmait DEPRECIATION REVALUATION MODEL DEPRECIATION REVALUATION INCREASE. FV ) CA « Income “OC! Normal” - Systematic allocation previously impaired ~ Begins : avail for use : ceases ; ecrlier of derecognized & HFS ineome in OCI and accumuated in equity as RS - Not nized # RV) CV - RV wio ef of inflation + Method based on benefit consumption; not allowed fo be based on revenue - Usetul life - period or number of production | units expecied IMPORTANT NOTES IN DEPRECIATING PPE - SL - dep'n is a function of time rather than function of usage - Leasehold improvements are depreciated over {D useful life (2) rem lease term, whichever is shorter - GroupjComposite Method (D Group of Assets - Single Asset (2) Composite/Average Lite = Depreciable Amount + Annual Depreciation (3) Composite Rate = Annual Depreciation + Total Cost (4) Depreciation = Cost x Composite Rate 15) No-gainloss on depose * you purchase an asset and add it into the composite group, composite rate will not change (even if disposed) - Activity Method - Depreciation = Hours Used x DR DR = DA + Total Estimated Hours (SV is included in the computation) - Retirement Method - depreciation recognized upon retirement = (¢ Retired) (Cost - RV) + Replacement Method - retirement based on acquired = (# Retired) (Acq - RV) - Inventory Method - Orig + Acq - Ret-EV at year-end - RV shall be reviewed at least each year-end - Gain/Loss on Disposal not recognized as revenue (only as other income) - No depreciation under usage method if there is no production - Cost of replaced item = Cost of replacement x PV factor {if not given) (2) Previously impaired - Income in Pil as reversal of IL - Excess is income in OCI REVALUATION DECREASE FV ( CA = Expense “P/ Normaf” (1) Not previously re: + Expense in P/l as revaluation loss {2) Previously revalued - Expense in OC! to the extent of RS - Excess is expensed in P/l as revaluation loss Proportionate Resictement : used i csset has Replacement Co Elmination/Direct Approach : go directly to FY not to RC Non-Depreciable - reclined on disposs! Deprecioble - through depreciation & disposal Presentation to ch ys in BS, (D FV Changes (2) Reatrafion - not translerred to OCL, onty to “RE” Revalued Amount = FY AID Revaluotion Mode! - sufficient regularity, entire class, changes in FY Revaluation depends upon c! sin PVs (exception: annually or 3 or 5 years # wokstile! F there is o policy that recimed RS is not transtered to RE, RS bolance wil semain unchanged The FS shall disclose for each class, acquisitions from BC No need to disclose the expected date o! next rewaluation Class of arse! no need to disclose FY of reporting date + lg Oepreciated Replacement Cost rs not given, {og aso wl respect to RC iS years Expired / Teta! We & Total lige + Years Expired = tf WO #RS may be iranseired te RE when the Prop 15 sold CSP -Con) Prepetly, Plat &. Equipmeit Ra DUMP ; Lump-sum purchase - allocate the total costs (includ FV or cen purchase 1° costs (i ing all necessary exp) based on ~ When CPE is given, use it as the cost of the PPE plus any capitalizable costs, even if computation for delerred payment is given In absence of CPE, the cost of PPE is the PV. If payable in installment use annuity PV factor and if payable in lump sum, use single payment PV factor > li the date of first payment is on the date of aoquisition and payable in installment, use annuity due PV factor + Cash gifts or grants from nonsharehoklers are recognized as income at FV when received or receivable - Last property tax bil indicating assessed value is not the FV of asset received - Legal expenses for transfer ol donated property is not capitalizable but deducted from donated capital + Cash discounts whether taken or not is deducted from the cost of PPE - Freasury shares can be adjusted to FV for computation of PPE cost in absence of FY ol ~ Scrap value of existing structures are deducted from PPE cost - Hin the exchange the FV of new PPE is not available, use Cash Price without trade-in there is no mentioned change in the residual value, use the same residual value - Under declining balance method, residual value is ignored + CV is reduced by decommissioning bability - Note that i there is a change in accounting estimate, use remaining EUL - When the asset is fully depreciated, max depreciation is depreciation less residual value, even if the method is double deciining ry deduct on, faren aorshe y asset ~ Legal Expenses in connection wv/ donation will not affect tHE Ca e cost ~ appraiser Fee iS Copttalzabl® (necessary to tntow oppraived value ds basis ef 0 . j ue , - Appraised Value is not Fair va = Casi Price (deduct cash DP) = Inderect Expense = Total Payments ct oe > rem-inerest Loan -roiect In efb shi - Properiy Taxes Cla: Pray UE Sid ater eg PE ~ option Price sand) zed TENot Acquited® expen? Acquired > COP! ‘ine . ing CostcMachine) oisrronnn ob\igation: capitalized CPV) Ceng. required by conte act) cation) Rea UME - GOVERNMENT GRANT + For nandepreciable assets: allocate income over periods based on related costs over the peri - For depreciable assets: allocate income over the usetul life of the project _ - Grants related to nondepreciable assets requiring fulfillment of conditions is allocated based on costs or uniformly like depreciable assets (if useful fe is given and related costs are not met) . - If the accounting policy of the company is to treat government grant as a reduction to the cos! of asset, treat it like a residual value to get the depreciation expense for the period Crnerefote 2deductions in cost) - Under declining balance, depreciation expense ignores residual value - Loss on repayment of grant if some violations were made, deduct the amountal igi Bolof Def income w/ Griginal Gran} - 4 noninterest pear note is vocoived, Deterred int Income = Face Value - PV income nt = ol in x Rate ~ Depreciation Expense Ip He grant is treated as Feduchon wost « Bepore Repoyment due to BrBach * ¢ Cost-Grant “Rv) 7 EUL + In the Year af Repayment duc i Breach CA in Acetg Estimate } so ¥ Oep'n en Cost ( Coot -@v) + EUL ~ se ntefot b rig 10. Depin en GG,cumulatve CoG EU) xn before breach, | ne teat Total Oep'n & " . Aner Repaprient ove 19 Breagh = (Cosi RVD + EUL / Wd Xp Id bid. ~Purchase Pree of and of Apartment BIAS tt EL Og ken Hem t build jag ¥ LOSS SPECIFIC BORROWING Capitalizable Cost = Interest (Acquisition Cost x Rate x nf12) - Interest Income GENERAL BORROWING - When expendi - WAAE x WAIR vs Borrowii - WAIR = Annual Borrowing Costs + Principal - WAAE « Expenditures x n/l2 + Ignore investment or interest income Cost, whichever is \) (dil is Interest Expense) incurred evenly, divide by 2 SPECIFIC-GENERAL BORROWING - Get WAAE - WAAE - Specilic Borrowing Principal_ = General Borrowing Cosi - "The only other debt" - indicator of General Borrowing 1 CONSHrUCtiON /Production/ Dev’ of w Gualifying Asse} -® CAPITALIZED CQualitying Asset - takes a substantlat time ‘o complete) 2.Connected to Assets that are Not Qualitying a» EXpENSEP ceg: inventory) RAL OUIE - When S-G Borrowing covers 2 periods, same procedure applies with Year 1 but in Year 2, the capitalizable cost of Year 1 forms part of General Borrowing in full - When Specific Borrowing is compounded, interest is based on Future Value less Principal, where factor is 1" + 2-Year Construction Period <) Compute WAAE -Compare wy specipic Botrowing oie Wha is vasstinon SB, the whole amount is For SB Only ~ Note start of constuction he <2) Compute WAIR . (a) Campute Copitalizable interest Note that even WAAE is multiplied w/ Miz, capitatizable interes + is grill multiplied w) ‘la ip not staried ¥ 4) Compute WAAE . eee cost 1c fi to bo inguded in the compuldtion is Expenditures in ¥4 @ Capitalized Interest in 4 = sare trgatment on Succeeding expenditures )Segregaie WAAE tosb+G68 WAAE * Speatic ro) Generat a (g)Compute Capralizob'é interest NOTE : Hin WAAE is 4HE construChgn petted In the year 4 in imnerest ts 12 SINTER EST EXPENSE Speopio Principal x int) Borrowing ¢ Principal Kim) Total Incurred Be for the Year Capitalized 80 fo the yeu" INTEREST EXP FOR THE YEAR. Mx 1B «be INTANGIBLE ASSETS INITIAL MEASUREMENT - Cost 1. Separate Acquisition 2. Exchange 3. Government Grant 4, Business Combination 5. Sell-Generation / Self-Creation AETER INITIAL RECOGNITION - Cost Model - Revaluation Model UMITED LIFE a. Amortization Life b, Impairment, when there is an indication of impairment INDEFINITE LIFE a. Not amortized b. Impairment - annually RESEARCH & DEVELOPMENT COST 1. Before Commercial Production 2. Research Phase - fo discover new scientific knowledge - EXPENSE 3. Development Phase ic n of research findings = CAPITALIZE as IA if alter technical feasibilty 4. Equipment Building a. no alternative use - EXPENSE , b, Has altemative use * yarlous Projects” - CAPITALIZE as Asset - Depreciation will eventually form part of R&D Expense / Expense (R&D), Capitalize (Development) | Inventory (Production) T T Technical Feasbilty Commercial Production RAL DUMP ~ Customer List “Gov't contract not based on an . ase fegg i an Comractyal rel atonsite is oh BE ee LA EROM cncther entity bu il sel erat (der erable and 5 Here! arg opored - Excess of cos! of FV of INA acquired - ASSOC ‘Goodwill included in Investment Balance (not reported separately) - Expropriation GainjLoss . uter soptware shall Beye im ot pat of ural operation the aa ore than tog ofmerwité, “T-Afsl ois an impairment loss is recognized (Sader en ta om sone dBieny sO - jompled Wordorce | establishment, preopening preoperatin: ble. ; >Amottizaton of Palent REUL or ALL ; onberded in Sood ed + 1A win aarinit® (i¢@ iS not amorkzed ee er mainenance but not enhancement _ Ut tested ome mote t at eas aor ~ unsuccesstul - Gov't Contrad i Fecognize : Noncompettion Agreement Sepatdicly if based on an fegal a ey be consdored aA Comractug) relationsh - The cost of developing & maintaining goodwill is expensed outright - Goodwill is not amortized but tested for impairment ° for Leastholy Improvements are de: over remaining lease te: lite inprovemens, whthever i thoter marina iocee term or He he - Cost of conference - development expense, not R&D renew ~ Reimbursable Costs - not part of R&D - I pattern of future benefit from intangible asset cannot be determined - use straight. line amortization ~The Cost of comerence is expensed immediately but not as part RED > PAS 38 tot not cover RED performed under contract ef others, including direct costs that are Specifically reimbursable under the contract ~ Legal costs incurred 40 ttle 0 pate should be charged to Patent Account ~Equiprnent no alternative use - RKD expense full amount - Equipment wi alternative use - compute mma diziey RLD exP based on total Ife ~Seasonal 01 other pericdic design chan ges to ey isting products aré not RYO big it relates to commercial prodwcho! . - Route on-going. efforts to refine, enrich oiherwise Improve an exishng Produc - not AkO expense , ‘ined = Ig the Pattern cuture benef fram gn intangiote ase+ cannot be determ celiably, the SL method ef amortization shalf be used - Amortization of Intangible Assets is the remaining uselul life or remaining legal lite | i + PAS 32, 39; PFRS 7, 9 Cunert Nabililies 3. No unconditional right to defer payment for at least 12 months 4. Payable on demand NONCURRENT LIABILITIES 1 Right to defer payment 2. Refinanced on or before BS date 3. Discretion to roll over CLASSIFICATION OF LIABILITIES NOTES PAYABLE CURRENT LIABILITIES INTEREST-BEARING: Present Value = Face Value 1, Due in 12 months (D FV received (2) Discounted FV 2. Trade Payables * Discounted Own Note - regardless of period, interes! is deducted INTEREST-BEARING 1. Unredlistically Low (Discount) 2. Unrealistically High Premium) * PV « PV of Principal + PV of Interest Interest Expense = PV x ER x njl2 Interest Payable » Face Value x NR x nfl2 PROVISIONS & CONTINGENCIES PROVISIONS - lability of uncertain timing & amount; existence is certain 1, Best estimate (judgment of experts) 2. Mest likely outcome (single obligation) 3. Amount settled subsequent before issuance of FS 4 Weiatting all possible outcomes (large population) 5, Midpoint (continuous range) 6. Present Value (time value of money) CONTINGENT LIABILITIES = existence is uncertain or amount can't be reliably measured even if outflow is - disclosed only PREMIUMS & COUPONS NET PREMIUM COST Purchase Price + Distribution Cost - Remittance by Customer PREMIUMS EXPENSE Units sold x % expected to be redeemed + coupons per unit x Net Prem Cost ESTIMATED PREMIUM LIABILITY Coupons to be redeemed (Cumulative Sales x % Exp to be Redemed) XK Coupons already redeemed (Cumulative) @ Outstanding coupons x Foupons 1 per unit +x mium Cost xk ESTIMATED PREMIUM LIABILITY x @) Coupons Exp to be Redeemed x Payment for Each - Payment WARRANTY GIFT CERTIFICATE OUT: es ORDINARY - affected by actual warranty expenditures; uses total warranty % OCCURRED EVENLY + disregard actual warranty expenditure Estimated GC Payable, beg CC issued K redeemed GC lorleited, lost, expired ESINATED GC BATRBLE, END x Ex PAD 32, 39; PERS 7, 9 Currert Lahililies CUSTOMER-LOYALTY AWARDS - Points/Award Credits - separately - Deferred Income - obligation to deliver merchandise/provide service - Total Consideration: (D points (2) product sales ; allocated based on “Stand-Alone SP" - Revenue from Points = Total Points Redeemed Total Points EXPECTED to be redeemed BRAIN DUMP - Warranty Liability wi Risk-Adjustment Factoc: Weighted Probobilties x x Risk-Adjisiment Factor CRA) ¥ oe Adjusted Cash Flows « Amount Paid oO) Balance x x PY factor x + WARRANTY PROVISION = tose Warranty expense = weighted probabilities x RAT x Pg + WC prior tos = Disregard "f. of Cods in computing unearned pa for Ge ovis anding = Liability por Container Deposits , check validity pero for vet ong = Container Deposits Prior + Current + Returned Prior Ree ene ~ Lease Deposit «NCL -wobitly gor Nonrefundable De pos: = Deferred Revenue -all colle ed in advance i x “Estee cos egempnos Ot xRedin C00 Hv “Feder PS REDEMPTION: END = cusong faster 4 Snipments Mad econ 3 Canceled Orders CUSTOMERS’ ADVANCES, END lst BRAIN DUMP ee A SS - Coupon liability is not reduced by coupons on hand that had not been processed - Lease deposit is a noncurrent lability

Arty cv = FV ot year-end ent Price = Increase in SHE = Amount assigned to warr - Increase in SHE arising from the issuancé Amount allocated 10 Conversion Privilege ~ Convertible Bonds a) CA = Bonds Payable - Unamort DIS <2) Tota! Considecatian + cv converted CCA* Wil (3) SP = Tota! Consideration ~ Par Volue shai Cpisregard Mit Price ef Bood & Shr, ants of convertible. bonds = 4 Applicable ace res Issued er io bord indenture) ~ No equi component was recognized when ihe bonds were ‘originally issued means no DR to Bond Conversion Privilege -Shore Premium is reduced by Conversion Expense =No gain/loss when an ently pad the con instead of conversion y tt vortible bondholders OPERATING LEASE SALES & LEASEBACK - lessor retains risks & rewards; payments are INCOME ~ lessee does not recognize asset; payments are EXPENSED ‘LL. TOTAL RENTALS (AMORTIZED) @. based on patiern of fulure benefits b. if no pattern, use SL method - Lessee: Rent Expense - Lessor Rent Income 2. LEASE BONUS (received by +? - Lessee: Prepaid Rent Expense; amortized over the lease term - Lessor, Uneamed Rent Income; amortized over the lease term 3, LEASEHOLD IMPROVEMENTS (LESSEE) - Depreciation: Lease Term OR Uselul Life of LI (shorter) ~ Residual Value - ignored - Renewal Option * certain to be exercised - extended lease term 4, INITIAL DIRECT COSTS + Lessor (normally) a ing - deferred cl amortized over the lease term * Unamortized Initial DC (included in the CA of leased asset) * Do not include in the machine so as nol to combine w/ dep'n b. Finance Sales Type - included in Cost of Sales Direet Financing - included in Net Investment (receivable) - Lessee ‘a. Operating - outright expense b. Finance - included in the cos! of asset 5, REFUNDABLE SECURITY DEPOSIT - Lessee: NC Asset - Lessor: NC Liability Sn feare sig re bos : y str sis ‘Tedudion of rental expense (not an income ol lessee) + To remedy cash flow problems - Seller: Lessee : Buyer : Lessor io FV Ganio is recognized immediately - SPs $$ is recognized imi -5P{FY Gain/loss is recognized immediately Loss - compensated by future below market rent - deferred & amortized over the LT - eflect similar with “prepaid rent” -SP}FV Excess ol SP over FV - deferred & amortized over the LT Excess of FV over CA Belore applying the three comparisons above, # CA) FY, ~ Betore ap} a ' CAis written down to FY, the difference is recognized as “Imp Loss” - Gain: deterred & amortized over the LT - Loss: recognized immediately EMPLOYEE BENEFITS EXPENSE BRAIN DUMP D 1. Current Service Cost D 2. Past Servi POSTEMPLOYMENT BENEFITS - Past service Cost =PQO ts based en future salary winle 48.0 is based on current salary O3- Gain on Loss on Settlement ~ Prayacled Benet Obigat ae sexpcaled retirement —» Gain= PV of PBO Settled 7 Settlement Price ¢f) Futur: Sst 2 Salary Current ¥ Fy factorcal exp tehrement) . (2) Annual Pension Payrrient « FS y % CHighest Liehme ) Yes Worked oo Loss = PV of PB Settled « Settlement price Gy pu cexpecied 10 live) = APP t Py Canasta) fel x 4 a Ieteress Expense CPBO beg x DISC nen CH PBO ev cexpacled 0 vex pV cat expected retir emant) Cainglé payt) ©) 5. Interest Income (FVPA beg x Disc Kale -Detined Benefit Cost, ens D6. interest in Eppect ise Ceiling Employees Benen Expense iat tae) © 1 Geiltng , Remeasuremedt Gain lac Ceggect of Asse iting , beg? * Coise Rare > DEFINED BeNEEn cost cost end - Prepaidsaccrued Benet hen REMEASUREMENTS (oc!) ‘Accrued Bentpit Cost CPEObEg >FVPAbEG? —* - . . CR ady (DR adj) ¢ OBC > Contribution) x 4, Changes in Actuarial Assumptions —? PBO Accrued Benefit cost x 4 in PBO —* Actuarial Loss - Fy eg Plan Asssis,end = bin PBO > Actuarial Gain batts on x 9. Digg b/w Actuarial Return on PA + Interest Intome Actua Return x aR > int income —® Remeasurement Bain Benepts pard a ; AR & Int Income —> Remeasuremeat Loss Cone. Ta, ~settlement Price af 060 3.Changes in Efgert of Asse! Ceiling excluding Interest Compontnt f~ peoeg x Tacreose- L999 ©» Asse Eevect @ Asset citing. bey oso * Decrease - Gain C4 Asset) x Bisc Rate Por est exp x Actuono! Loss Gol) oe OTHER BENEFITS ; ; gene SE PV 060 1. Tefmination Benefits - not conditional an providing future / -@corued) Prepaid Benefit Cost.beg> EVPA + Unomort psc - PBO-UnreCeG AG adat'\ service : _ [eunder the transitional provision of. paging , He unomortized past sevice cost 2. Short-term Bene fits -Gandttional 9 providing gudure/ adar'l and 4re unrecognized actuoral Gain shall be elminated and accounted for j reirospectively as an odjusimer RE service - piscourt rote if silert is 107 - ceeFAcLoss) on Plan Settlement : FV of DBO ~Settlement Mice of PROF Pact of ESE dnreeme Tax pagan crsetneatrntomnenei se rr RNR ST PERMANENT DIFFERENCES | 1. Nontaxable Income 2. Nondeductible Expenses TEMPORARY DIFFERENCES {. Taxable Temp Digg / Future Toxable Amount —? Deferred Tax Liobility CNoncurtent Ligbilty) = Aocta Income 7 Tax Income ~ CA of Asset >. Tax Base Asset = CA of Liabiltty 4 Tax Base of uability 2. Deductible Temp oipf / Future Deductible Amount —+ Degerred Tax Asset CNoncurrent Asses -Tax Income > Acct Income - Tax Base of Asset > CA of Asset Tax Base of Liability ¢ CA of Wolotlity CURRENT TAX ENPENSE. = Taxable Income x Inc Tox Rate TOTAL TAY EXPENSE. = Accig. Income Supyect te Tax Cremove pp) x Inc Tax Rate Ck) = Current Tax Expense + OT Exp - oT Benefit “Enacted Future Tox Rote” BRAIN DUMP - Current Tax Expense iToxable Income Currem Issue b. Sale 2. \Ssue s¢ at Par /stated value/ Sp erom Curren Issue Cosh Share Premium - Donation ig inguggerent to absorb the SiC 2. With Fair Value G..gP trom previous issue @. Initial b. Retained Earnings Treasury Shares Shareheldew’ Equily SHARE OPTIONS SHARE APPRECIATION RIGHTS + General Formula FV of Share Options on the date of grant_x Shares x Rem Employees FY of Share Options on the date of grant_x Shares x Rem Employees Year or Vesting Period Year or Vesting Period * When FV of sh options is not given, u i value Intrinsic Value = MV of Shares - Option Price ~ loumel Entry sion Expence “to Cash SARs Liability Compensation Expense Share Options Outstanding - H options vest immediately, FV of options should be recognized in full as e nse mally, 3 Yr-Vesting Period and the CE is computed as follows: Year 1 = Gen Formula x 3 Year 2 = Gen Formula x 2/3 - YICE Year 3 = Gen Formula x 3/3 - Y1CE - ¥2 CE - Service Condition not met will result to cancellation of Share Options Out- standing (DR: SOO, CR: RB ~ It the is based on Share Price (dictated by market and where employees have no control), i will not be affected by target - Il options vest immediately, FV of options should be recognized in full as expense - Service Condition not met will resull fo cancellation of Share Options Out- standing (DR: SOO, CR: RD - the is based on Share Price (dictated by market and where employees have no control), it will not be affected by target - Normally, 3 Yr-Vesting Petiod and the CE is computed as follows: Year 1 = Gen Formula x 8, Year 2 » Gen Formula x 2/3 - YICE Year 3 = Gen Formula x33 - YICE - ¥2 CE - Paymeni(Exercise of Cash SARs Liability ( Debit to Cash SARs Liability (FV at year-end x Shares x Rem Employees} - Cash SARs Liab (Cumulative) (2) Credit to Cash as Payment (intrinsic Value x Shares x Exercising Employees) (3) Diff of (2) and (D is the amount debited to CE SHARE OPTIONS _|SHR APPRECIATION RIGHY Compensation Salaries Expense Saiories Expense Credit Equity Shr Op Quis'ng Liabinty — Cash Cshare Premium) Measurement Of Veg Stir Options Lev ai Labbilty date of grant CExcess of Mit Pricd “pred in amount” 2Antrinsic Value of $0 CExcess of Mkt Price over Ophon Price) . “not ped in amount” 4. Yeor-end b, Settiement over Pred Price ) not fixed mm amount” Year-end b. Settlement Vest immediately Compensation is expensed | Compensation is expensed immediately immediotely Do not vest imme- diately Comperisation is over the vesting penod expensed | Compensation Is expensed over tne VeSting period COMPOUND INSTRUMENT CRight of choice is on the counterparty - Shard 6” Cash Alternative ) ACCELERATION OF VESTING Cearly settlement of the options /award) Compensation Exp on VD Csupposedly) / Payment Compensation Exp m PYs Compensation Exp in Cy Ke use FV et ihe whole instrumend (Shrs Alt x FV of She Alt) X Fiegive Liability (Eq Shee of Cash Alt x Fv sre on date of grat) &) Equity- share Options Outstanding x Year Cumulative Comp-Hiolb Erp-liob Exp-Eau ity, Total Comp Exp CEqshes of Cash AI) x $00=3 belab t Year-End Fv x 3 Exp- Equity x43 x3 * SHARE ALT 1S CHOSEN (Right to receive Cash is forreited > Liability — CoLen 93 Share Options Ouistan ding $00 total for Share Capital Shes Alt ¥ 6 share eremturn Balandng Figure *CASH ALT I$ CHOSEN Right #0 receive Shares is forgeted) Liotoitt ‘anny tim 98 oun 93 Share Opriqns Outstanding SOOTOHOL total Share Premium 50) Mee A implied interest = Total Poyment Ca, shts of Cash AH * = Liability NOTE! 4 1E-0} “Ip FV Ene date of grant is not given use 1V Method crve ®remeasute until ¥eor 4 settlement! prion P) Book Value per Shade e BV FOR PREFERENCE SHARE |BV FOR ORDINARY SHARE No.of Ordinary Shrs Outstan ing COMPONEN . PONENTS of PREF SHE : COMPONENTS of ORD SHE tai Pret sHE = Total Ord SHE 1. Total Par (stated Yalué Outstanding 7 2. Any Liquidation Premium Total sHe Cexcess of Liquidation Price over Pac/stated Value) 8. Preperence Dividend cuadeclared/unpaid dividends) a. Cumulative - include all dividends -in-orreacs b. Non-cumulotve — include only curtent/one yeor & Silent : Prec Shore» Non-Cumulative CALL PRIGE - amount to be paid to prepehoreholders ducin the Wpetime of the corporation Cignored since BY is concern w/ liquidation and not applied fan the hgetime of co ) ; tor BRAIN DUMP = Dividends -in -arrearcs stated in the Problem includes *e current year -Subscription Recevabcle hot induded in ihe computation of Bv/share since tt 19 an asset collectible . ; - - Dividends-in-arrears FeMaining unpaid ore disclosed ¢ not tiab until legally declared’ = Bagore participation +f Participating prep Shrs, ne OS are first ger Share in cy dividend using lower Peepererce rate (partic pating? . = when there are no dividends-in ore Bar and the pregshr is pully porfeipafing, the dividend is simpt allocated gna pro-rata basis on total par ~7Ti. up to 10% - use | Los pret dt