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2021 FE Solution

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24 views6 pages

2021 FE Solution

Uploaded by

joehe2625
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Local Currency 1.

NZ dollar is the Func


Income statement for 2020 £ Exchange rate
Sales revenue 2,500,000 1.6
Opening Inventory 100,000 2
Purchases 700,000 1.6
Ending inventory -150,000 1.5
Cost of Goods Sold 650,000
Gross Profit 1,850,000
Depreciation- plant assets -190,000 2
Depreciation- additional plant assets -25,000 1.8
Other expenses -200,000 1.6
Tax -100,000 1.6
-/+ foreign exchange gain/loss (if applicable)
Net Profit 1,335,000
Retained Earnings 1/1/20 200,000 2
Dividends -300,000 1.7
Retained Earnings 31/12/20 1,235,000

Balance Sheet as at 31 Dcember 2020


Contributed Capital 2,000,000 2
Additional contributed capital 400,000 1.9
Retained Earnings 1,235,000
Foreign Currency Translation Reserve (if applicable)
Accounts Payable 1,400,000 1.4
Total Liabilities and Equity 5,035,000
Plant Assets (net) 1,710,000 2
Additional Plant Assets (net) 475,000 1.8
Inventory 150,000 1.5
Cash and accounts receivable 2,700,000 1.4
Total Assets 5,035,000

• Relevant exchange rates were as follows:


1 January 2020: £1.00 = NZ$2.0
1 February 2020: £1.00 = NZ$1.9
1 July 2020: £1.00 = NZ$1.8
13 July 2020: £1.00 = NZ$1.7
1 December 2020: £1.00 = NZ$1.5
31 December 2020: £1.00 = NZ$1.4
Average 2020 financial year £1.00 = NZ$1.6

Exchange gains and losses £ $NZ


Net Monetary position 1.1.2020 200,000 2 400,000
Sales 2,500,000 1.6 4,000,000
Expenses - 200,000 1.6 - 320,000
Purchases - 700,000 1.6 - 1,120,000
Additional capital 400,000 1.9 760,000
Purchase of additional plant - 500,000 1.8 - 900,000
Tax - 100,000 1.6 - 160,000
Dividends - 300,000 1.7 - 510,000
2,150,000
Net monetary position 31.12.2020 1,300,000 1.4 1,820,000
FC loss - 330,000

Foreign currency translation reserve


Net asset position 1.1.2020 2200000 2 4400000
Net profit 1,335,000 2081000
Additional capital 400000 1.9 760000
Dividends -300,000 1.7 -510000
6731000
Net asset position 31.12.2020 3635000 1.4 5089000
FC translation reserve -1642000
1. NZ dollar is the Functional Currency 2. The British Pound (£) is the Functional Currency
$NZ Exchange rate $NZ
4,000,000 1.6 4,000,000
200,000 2 200,000.0
1,120,000 1.6 1,120,000.0
- 225,000 1.5 - 225,000.0
1,095,000 1,095,000
2,905,000 2,905,000
- 380,000 1.6 - 304,000
- 45,000 1.6 - 40,000
- 320,000 1.6 - 320,000
- 160,000 1.6 - 160,000
- 330,000
1,670,000 2,081,000
400,000 2 400,000
- 510,000 1.7 - 510,000
1,560,000 1,971,000

4,000,000 2 4,000,000
760,000 1.9 760,000
1,560,000 1,971,000
- 1,642,000
1,960,000 1.4 1,960,000
8,280,000 7,049,000
3,420,000 1.4 2,394,000
855,000 1.4 665,000
225,000 1.4 210,000
3,780,000 1.4 3,780,000
8,280,000 7,049,000
Relevant exchange rates were as follows:
1 January 2020: £1.00 = NZ$2.0
1 February 2020: £1.00 = NZ$1.9 GI made an additional capital contribution to SL of £400,000 on 1
1 July 2020: £1.00 = NZ$1.8 The 2020 depreciation expense for the plant assets on hand at th
13 July 2020: £1.00 = NZ$1.7
1 December 2020: £1.00 = NZ$1.5 The opening inventory was on hand at the time of the acquisition
31 December 2020: £1.00 = NZ$1.4
Average 2020 financial year £1.00 = NZ$1.6
on to SL of £400,000 on 1 February 2020.
plant assets on hand at the time of the acquisition was £190,000. On 1 July 2020, GI acquired additional plant assets of £500,000 which were deprec

he time of the acquisition of SL. The closing inventory was acquired on 1 December 2020.
£500,000 which were depreciated by £25,000 in 2020.

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