1.

Indicate what quality characteristics are recorded by accountant according to conceptual framewor

(1) Lee sold a fixed asset and leased it back for the remainder of its useful life. Therefore, the accountant rec
=> FAITHFUL REPRESENTATION
Because when selling fixed assets, the compny will lose control and use of it.
When releasing fixed assets. The company will have to pay rent during the lease period as a liability and hav
This matches with faithful representation means that the numbers and descriptions match what really existed
completeness+neutrality+free from errors
the increase in asset price is greater than the loss in business operations, so the accountant decides
switch to the rescheduling model.
=>
the increase inRELEVANCE
asset price is greater than the loss in business operations, so the accountant decides
switch to the rescheduling model
This matches with the relevances characteristic about Predictive value and Materiality:
The expected increase value in asset will decrease the loss that effects to the decision making to switch to th
(3) In 2019, Lee company uses the FIFO method to calculate inventory prices.
In 2020, accounting has been changed to the weighted average method. Therefore, accountants
determined to re-adjust the beginning of the existing balance according to the weighted average method

=> COMPARABILITY
In 2020, company re-adjust the beginning inventories form FIFO to weighted average method.
This macthes with the Comparability characteristic about the price of inventories is measured and reported i

2.
When Lee doubts about the going concern assumption of the company. At the time of preparing the financi
December 31, 2020. The company shouldn't continue preparing financial statements on going concern assum
So , the company should prepare financial statements on another assumption. At this time, the company wil
Fixed assets do not track cost and depreciation but care about liquidation value
Receivables are not tracked and provisioned but are concerned with recoverable value
o conceptual framework?

fore, the accountant recognized this as a liability.

od as a liability and have the right to use the property

atch what really existed or happened

ntant decides

ntant decides

n making to switch to the rescheduling model

ccountants
ed average method

measured and reported in a similar manner

of preparing the financial statements for the year ended

on going concern assumption.
s time, the company will reclassify assets, not presenting short-term and long-term
(1)
According to conceptual framework, Sunny shouln't record a reduction in receivable account.
Because Sunny still have the control with this asset, Sunny is obligated to repay the receivables that Finease
Beside that, Sunny should record 10 millions dong as a General administration expenses.
At the end of the month, there is no repayment from customer, so Sunny has to pay an interest 2% from 1,8
Interest 0.036
Sunny records 36 millions dong as a financial expense
(2)
According to conceptual framework, Sunny can't record 10 billions dong as a revenue.
Risks and rewards of ownership haven't been transfered from Sunny to Cashflow. Because Sunny can buy b
10 billions dong should record as a liability, are secured by the goods.
Since 10 billions dong are still not recorded as a revenue, 60 millions dong should be recorded as a cost.
receivables that Finease failed to collect after 6 months. Sunny should record this event as a liablity

an interest 2% from 1,8 billions dong

ecause Sunny can buy back these goods at any time within 2 years, Sunny still have the control over the goods.

e recorded as a cost.
l over the goods.
1.The company spent 2.2 billion dong this year on a research project on a wide range of new cosmetic
for men
According to the conceptual accounting framework, an asset is recognized if it meets the definition of the as
Therefore, the company only recognizes an increase in expenses, mustn’t recognize assets because this is ju

SoFP Income Statement

Cash: decrease 2,2 Cost: increase 2,2
Equity:
2.A decrease
Retired 2,2 stole 20 million dong in
employee ->cash
Profit: decrease
while 2,2 at a beauty shop
working

Initially, the company has to recognize about the event that retired employee stole 20 million VND in the re
Because it still not determine that the employee will return the stolen money to the company or not. If the em
TH1: Return money conceptual framework: faithful representation
SoFP Statement of Cashflow
Cash: decrease 20
Cash payment 20
Account Receivable: inc

TH2: Not return money

SoFP Income Statement Statement of cashflow
Cash: decrease 20 Cost: increase 20
Equity: decrease 2,2 -> Profit: decrease 20 Cash payment 2,2
3.Receiving a customer complaint require Lampter company to compensate for damage caused by
consumption of poor quality products of the company

Since this lawsuit has not yet been judged by the court as to who won so company shouldn’t recognise anyth
However, to ensure that the Report meets the materiality principle, the company should still present in Note
ange of new cosmetics

the definition of the asset. But in this case, the project doesn’t meet the definition of the asset.
ssets because this is just a research project, so it is not possible to sure that it will receive economic benefits in the futu

Statement of cashflow
Cash payment 2,2

million VND in the receivable

mpany or not. If the employee does not return it, the business must accept the loss of money and recognise it as an exp

damage caused by

ouldn’t recognise anything in the Report.

ld still present in Notes
conomic benefits in the future or not

y and recognise it as an expense

DN owning fixed assets: a) Historical Cost:
(triệu đồng)
Purchase Price: 100,000 b) Value in use:
Accumulated Depreciation: 40,000 4 years
Selling fixed assets: c) Net Realisable Value (NRV) :
Selling Price: 50,000
Transaction Cost: 500 d) Current Cost:
Purchase a new asset:
Purchase Price: 110,000
Estimated cash flows: 25,000 2 years
20,000 4 years
Weighted Average Cost of Capital 10%
Historical Cost: 60,000
(Historical Cost = Purchase Price - Accumulated Depreciation)
Value in use: 95,783
Discounted Cash Flow
Net Realisable Value (NRV) : 49,500
(Fair value = Selling Price - Transaction Cost)
Current Cost: 66,000
(Current Cost = Purchase Price - Accumulated Depreciation)
 FCM - Constant
Physical capital
FCM - Monetary purchasing
maintenance
Revenue 2,200 power 2,200 2,200
Cost of goods sold (2,000) (2,000) (2,150)
Income 200 200 50
Adjust (100)
Total Income 200 100 50