Complete FR CPA Materials

Rochester pIc has entered into a fixed price contract for the provision of services to Adele Ltd. The contract commenced in September 2012 and will be completed in 2013. The contract price is $2 million and costs are recoverable as incurred. At 31 December 2012, Rochester plc's year ends, costs of $500,000 have been incurred.

The contract has been assessed as 30% complete; however, costs to complete cannot be estimated reliably.

In accordance with IAS 18 Revenue, how much revenue should be included in Rochester plc's statement of comprehensive income for the year ended 31 December 2012 in respect of this contract?

Measurement of the elements of financial position is the process of determining the monetary amounts at which the elements of the financial statements are to berecognizedand carried in the statement of financial position and statement of comprehensive income. There are number of basis of measurement that companies use in preparing financial statements.

Which of the following best explains the ‘current cost accounting’?

A company is developing a new production process. During 2012, expenditure incurred was $100,000, of which $90,000 was incurred before 1 December 2012 and $10,000 between 1 December 2012 and 31 December 2012. The company can demonstrate that, at 1 December 2012, the production process met the criteria for recognition as an intangible asset. The recoverable amount of the know-how embodied in the process is estimated to be $50,000.

How should the expenditure be treated?

Which of the following are roles of the IFRS Foundation?

(1)To issue IFRS

(2)To examine any identified or alleged departures from IFRS

(3)To guide the International Accounting Standards Board (IASB)

(4)To secure finance