week10_20092_student_final

week10_20092_student_final - THE UNIVERSITY OF NEW SOUTH...

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THE UNIVERSITY OF NEW SOUTH WALES School of Accounting ACCT 1501: Accounting and Financial Management 1A Week 10 Accounting for Non-Current Assets Student Handout Lecturer: Dr. Youngdeok Lim School of Accounting UNSW Course website: http://www.elearning.unsw.edu.au/
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Table of Contents 1. Introduction to Weeks 10 Lecture 2. Learning Outcomes 3. Required Readings 4. Tutorial questions – Week 11 4.1. Preparation questions 4.2. Tutorial questions 5. Discussion issue 1. Introduction Welcome to the topic of accounting for non-current assets. Non-current assets encompass a company’s fixed assets (also called tangible assets) as well as intangibles such as goodwill, and other non-current assets such as non-current receivables, non- current investments, deferred income tax assets. All these are examples of assets whose benefit is expected to be used up over a period longer than the entity’s operating cycle or 12 months. Our focus for the next two weeks will be on two types of non-current assets, namely ‘property, plant and equipment’ and ‘intangible assets’. In the first week we will concentrate on how to account for the acquisition of these assets and then how to account for the consumption of the benefits represented by these assets known as depreciation ”. Non-current assets typically lose value over time so it is necessary to look at how to account for changes in value post acquisition. In the second week we continue our discussion of non-current assets by examining the impact of selling and disposing of non-current assets. We then consider measurement issues by examining how the value of non-current assets can change over time. In particular, we examine how to value non-current assets post acquisition, how to account for asset revaluations and the application of the recoverable amount test. We will briefly look at the impairment test for non-current assets also. For those students continuing on to more advanced financial accounting courses, it is highly advisable that you gain a solid understanding of all these concepts. 2. Learning Outcomes At the end of this topic, you should be able to: Calculate the amount of depreciation using different depreciation methods Account for sales of non-current assets Understand and perform entries for disposal of non-current assets Understand and perform asset revaluations Understand the process of revaluation reversals Session 2, 2009 AFM1A 2
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3. Required Readings Required reading for Week 10 rd edition - Chapter 9 Required Supplementary Readings Attached o Earning management - General Electric case o CPRS and impairment of electricity generation assets 4. Tutorial Questions – Week 11 4.1 Preparation Questions for Week 11 Students should attempt these questions before the tutorial TG DQ 9.7 TG DQ 9.8 TG DQ 9.9 TG Problem 9.22 TG Case 9A parts 7 to 12 4.2 Tutorial Questions for Week 11 TG Problem 9.11 TG Problem 9.25 TG Case9E Session 2, 2009 AFM1A 3
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5. Discussion Issue
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This note was uploaded on 09/14/2011 for the course ACCT 1001 taught by Professor John during the Spring '11 term at Renmin University of China.

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week10_20092_student_final - THE UNIVERSITY OF NEW SOUTH...

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