Nguyễn Thị Kiều Trinh - 19071266

Question 1:
a, Under IFRS
Value in use: $ 18
Net selling price: $ 17.5
=> Recoverable amount = Greater value ( Net selling price; Value in use)
= Greater ($18; $17.5)
= $18
Because carrying amount ($18) = Recoverable amount ($18)
=> Not impairment => No Journal entry
b, Under U.S GAAP
Carrying amount: $ 18
Undiscounted future cashflow: $ 20
Because carrying amount ($18) < Undiscounted future cashflow ($20)
=> Not impairment => No Journal entry

Question 2:
The component 3 is: 100,000 - 20,000 - 10,000 = $70,000
The depreciation expense for Year 1 is:
20,000/5 + 10,000/4 + 70,000/20 = $10,000
Question 3:
Historical cost: $ 1,000
Replacement cost: $ 900
Estimated Selling price: $ 1,050
Estimated costs to complete and sell: $ 100

=> Net realizable value = Estimated selling price - Estimated costs to complete and sell
= $1,050 - $100 = $950
a, Under IFRS
IFRS value = Lower value ( Historical cost; Net relizable value)
= Lower value ( $1,000; $950) =$950
The journal entry at December 31, 2018:
Dr. Inventory Loss ( $1,000 - $950) $50
Cr. Inventory $50

b, Under U.S GAAP

U.S GAAP = Lower value ( Historical cost; Replacement cost)
= Lower value ( $1,000; $900) =$900
The journal entry at December 31, 2018:
Dr. Inventory Loss ( $1,000 - $900) $100
Cr. Inventory $100

Question 4:
Case 1:
Day 1: 1 JPY = 212.54 VND
Dr. Inventory ( 50,000 * 212.54) 10,627,000
Cr. Account Payable 10,627,000
 Day 30: 1 JPY = 210.67 VND
-> Foreign currency depreciates -> Foreign exchange gain
Dr. Account payable 10,627,000
Cr. Cash in bank (50,000 * 210.67) 10,533,500
Cr. Gain on foreign exchange 93,500

Case 2:
Day 1: 1 JPY = 209.20 VND
Dr. Inventory ( 50,000 * 209.20) 10,460,000
Cr. Account Payable 10,460,000

Day 30: 1 JPY = 210.50 VND

-> Foreign currency appreciates -> Foreign exchange loss
Dr. Account payable 10,460,000
Dr. Loss on foreign exchange 65,000
Cr. Cash in bank ( 50,000 * 210.50) 10,525,000

Question 5: Date Pound/USD

Case 1: September 15, 2019 1.23
December 31,2019 1.24
Jaunuary 1, 2020 1.25

=> Transaction value in September 15, 2019 = $100,000/1.23 = 81,301

Journal entry for each period:
+ September 15, 2019:
Dr. Account Receivable $100,000
Cr. Sales Revenue $100,000
+ December 31, 2019:
Dr. Account Receivable $813
Cr. Gain in foreign exchange $813
+ Jaunuary 1, 2020: 1pound = $1.25 ( Pound - appreciates; USD - depreciates)
Dr. Cash in bank ( $100,000/1.23 *1.25) $101,625
Cr. Account Receivable $100,813
Cr. Gain in foreign exchange $812

Case 2: Date Pound/USD

September 15, 2019 1.25
December 31,2019 1.23
Jaunuary 1, 2020 1.24

=> Transaction value in September 15, 2019 = $100,000/1.25 = $80,000

Journal entry for each period:
+ September 15, 2019:
Dr. Account Receivable $100,000
Cr. Sales Revenue $100,000
+ December 31, 2019:
Dr. Loss on foreign exchange
Cr. Account Receivable
+ Jaunuary 1, 2020: 1pound = $1.24 ( Pound - appreciates; USD - depreciates)
Dr. Cash in bank ( $100,000/1.24) $99,200
Cr. Account Receivable
Cr. Gain in foreign exchange
0/20 = $10,000

ete and sell

 Account Receivable
September 15, 2019 $100,000
Add: 813
December 31,2019 100,813

Account Receivable
September 15, 2019 $100,000

December 31,2019