AccountingBasics英语会计基础教学课件(7)

1Chapter10Property,plantandequipment;intangibleassetsandgoodwill;mineralresourcesandbiologicalassetsDescribehowthecostprincipleappliestoproperty,plantandequipment(PPE)ExplaintheconceptofdepreciationandcalculateperiodicdepreciationusingdifferentmethodsIdentifythecapitalexpenditure,andexplaintheentriesfortheseexpendituresDescribethemeasurementofPPEsubsequenttoacquisitionandhowtoaccountforthedisposalofPPEExplainthebasicissuesrelatedtoaccountforintangibleassetsandgoodwillExplainhowPPE,intangibleassetsandgoodwillarereported2PROPERTY,PLANTANDEQUIPMENT3Property,plantandequipment(PPE)areresourcesthat…HaveaphysicalsubstanceAreusedintheoperationofabusinessArenotintendedforsaletocustomersTheyarealsocalledfixedassetsTheyareexpectedtoprovideservicesforanumberofyearsbutdeclineinservicepotentialovertheirusefullivesDeterminingthecostofPPE4CostprinciplerequiresPPEinitiallyberecordedatcostCostconsistsofallexpendituresnecessarytoacquiretheassetandmakeitreadyforitsintendeduseItincludespurchaseprice,freightcostsandinstallationcostsLO1DeterminingthecostofPPEcontinued51.LandThecostoflandincludes:CashpurchasepriceplusstampdutySettlementcostssuchastitleandlawyer’sfeesRealestateagents’commissionsAccruedpropertytaxesandotherliensonthelandassumedbythepurchaserDeterminingthecostofPPEcontinued6AllnecessarycostsincurredtomakelandreadyforitsintendedusearedebitedtotheLandaccountExampleLandCashpriceofproperty$100000Netremovalcostofwarehouse6000Lawyer’sfee1000Realestateagent’scommission8000CostoflandDeterminingthecostofPPEcontinued72.LandimprovementsThecostoflandimprovementsincludesallexpendituresneededtomaketheimprovementsreadyfortheirintendeduseCostsoflandimprovementsare(depreciated)expensedovertheirusefullifeExampleCostofnewcarparkincludespaving,fencingandlightingDeterminingthecostofPPEcontinued83.BuildingsThecostincludesallnecessaryexpendituresrelatingtothepurchaseorconstructionofabuildingpurchaseprice,stampduty,settlementcosts,realestateagent’scommissionCoststomakethebuildingreadyforitsintendeduseincludeexpendituresforremodellingandreplacingorrepairingtheroof,floors,wiring,andplumbingDeterminingthecostofPPEcontinued9Ifanewbuildingisconstructed,costsincludecontractpricepluspaymentsforarchitects’fees,buildingpermitsandexcavationcostsAlsoincludedareinterestpaymentsincurredtofinancetheprojectInclusionofinterestcostsincostofaconstructedbuildingislimitedtoconstructionperiod,afterwhichtheyareexpensedratherthancapitalisedDeterminingthecostofPPEcontinued104.EquipmentCostofequipmentconsistsofthecashpurchasepriceandcertainrelatedcostsTheserelatedcostsincludesalestaxes,freightchargesandinsurancepaidbythepurchaserduringtransitallexpendituresrequiredinassembling,installingandtestingDeterminingthecostofPPEcontinued11Example1JournalentryFactoryMachineryCashprice$50000Insuranceduringshipping3500Installationandtesting1000CostoffactorymachineryDeterminingthecostofPPEcontinued12Example2RecurringcostssuchaslicensesandinsuranceareexpensedasincurredJournalentryDeliveryTruckCashprice$22000Paintingandlettering1820Costofdeliverytruck$23820DeliveryTruck23820LicenseExpense80PrepaidInsurance1600Cash25500(Torecordpurchaseofdeliverytruckandrelatedexpenditure)Depreciation13DepreciationistheprocessofallocatingtoexpensethecostofaPPEassetoveritsuseful(service)lifeinarationalandsystematicmannerCarryingamountequalscostlessaccumulateddepreciationLO2Depreciationcontinued14Factorsincomputingdepreciation:Depreciationcontinued15Depreciationmethods1.Straight-line2.Units-of-activityorproduction3.Reducing-balanceDepreciationcontinued16ExampleDeliverytruckpurchasedbyFlora’sFloristson1July2010Cost$13000Expectedresidualvalue$1000Estimatedusefullife(inyears)5Estimatedusefullife(inkms)100000200815000200930000201020000201125000201210000Depreciationcontinued171.Straight-linemethodDepreciationexpensesameeachyearasbenefitsareconsumedatsamerateeachyearCalculationforannualcharge:costofasset–residualvalueusefullifeoftheassetDepreciablecostDepreciationcontinued18Flora’sFloristsexamplecostofasset–residualvalueusefullifeoftheassetAnnualdepreciationOr:thedepreciationrateisDepreciationcontinued19Straight-linedepreciationscheduleComputationEndofyearDepreciableDepreciationDepreciationAccumulatedCarryingYearamountxrate=expensep.a.depreciationamount2008$1200020%2009120002048008200201012000207200580020111200020960034002012120002012000FLORA’SFLORISTSDepreciationcontinued20JournalentrytorecorddepreciationexpenseStatementoffinancialpositionextract-asat30June2011Depreciationcontinued2.Reducing-balancemethodDepreciationexpensedecreaseseachyearasgreaterbenefitsareconsumedearlierinassetslifeAnnualdepreciationiscalculatedbymultiplyingthecarryingamountatthebeginningoftheyearbythereducingbalancedepreciationrateCalculation:Depreciationrate=1–or1–(r/c)1/nRatemaybeexpressedasdoublethestraight-lineratencr21Depreciationcontinued22Flora’sFloristsexampleAnnualdepreciationrate2.Diminishing-balancemethodDepreciationschedule:2008:23LO3:DepreciationMethodsCarryingAmount