CPA Financial Reporting case studies
CPA Financial Reporting · Put your knowledge to work in context.
Financial Reporting is one of the education segments within the CPA Program, the professional qualification pathway offered by CPA Australia. It is aimed at candidates progressing towards CPA membership who need a working command of external financial reporting under Australian accounting standards and the international framework they are based on. The CPA Financial Reporting case studies are 5 cases and about 3,824 words.
1Kestrel Ltd: allocating a bundled price and constraining a bonus
On 1 October 20X5 Kestrel Ltd signed a contract to supply a packaging line to a customer for a stated price of 1,200,000, including installation and three years of maintenance. Kestrel regularly sells the line for 1,000,000, installation for 150,000 and three years of maintenance for 250,000.
586 words, about 3 min2Meridian Ltd: lease term, included payments and the right-of-use asset
On 1 January 20X6 Meridian Ltd entered a lease of a warehouse for a non-cancellable term of five years with an option to extend for a further three years at the same annual rent of 100,000, payable in advance on 1 January. Meridian has fitted the warehouse with conveyor systems costing 700,000 that have no alternative use and would be worthless if the lease ended in 20Y1.
781 words, about 4 min3Ravenswood Ltd: impairment of a CGU containing goodwill and a revalued asset
Ravenswood Ltd tests its bottling plant for impairment each year. The plant is the smallest group of assets that generates independent cash inflows and is also an operating segment.
782 words, about 4 min4Dalton Ltd: restructuring and onerous contract provisions at the year end
Dalton Ltd's board approved a detailed plan on 15 November 20X6 to close its Leeds factory and move production to Hull. The plan identified the site, the 120 employees to be made redundant, statutory redundancy of 1,800,000, completion by 30 June 20X7, retraining of retained staff at 300,000 and relocation costs of 250,000.
841 words, about 4 min5Pelham Ltd: goodwill, transaction costs and measurement period adjustments
On 1 July 20X6 Pelham Ltd acquired 75% of Sorell Ltd for 7,500,000 cash plus a promise to pay Sorell's former owners a further 1,000,000 if Sorell's cumulative EBITDA for 20X7 and 20X8 exceeds 4,000,000. At the acquisition date Pelham's directors assess the fair value of that promise at 350,000.
834 words, about 4 min