At 31 December 20X4 the directors of MNO decide to revalue its property. Before revaluation adjustments the balances relating to property are as follows:

The property has been revalued at $1,600,000.
How much will be included within MNO's statement of financial position at 31 December 20X4 for revaluation surplus?

• A. $400,000
• B. $1,600,000
• C. $810,000
• D. $1,190,000

In accordance with IAS 16 Property, Plant and Equipment, in which of the following situations would subsequent expenditure on a non-current asset be capitalised?

• A. An entity purchased an aircraft five years ago, when its engines were separately identified in the accounting records. The engines now need to be replaced at a cost of $2 million each. When the engines are replaced the aircraft is expected to be airworthy for a further 5 years.
• B. An entity's delivery vehicle was in a car park when the car park was flooded. The engine and interior of the vehicle needed extensive repair and renovation costing $25,000.
• C. A manufacturing entity closes its factory for two weeks each summer for routine maintenance and repairs. The current year's cost of maintenance and repairs was $62,000.
• D. An entity's head office building suffered a major fire, the upper floors and roof were completely destroyed. The entity proposes to restore the building at a cost of $1 million and move back in to the building to use it as a head office again.

Which of the following is a feature of value added tax (VAT)?

• A. Entities that make only standard-rated or zero-rated supplies have their right to recover input tax restricted.
• B. Only registered entities can charge VAT on sales or recover VAT paid on purchases.
• C. The value of all supplies must be taken into account when determining whether the registration threshold has been exceeded.
• D. Entities cannot register for VAT if the value of their taxable supplies is below the registration threshold.

XYZ operates in Country P where the tax rules state entertaining costs and accounting depreciation are disallowable for tax purposes.
In year ending 31 March 20X4, XYZ made an accounting profit of $240,000.
Profit included $14,500 of entertaining costs and $5,000 of income exempt from taxation.
XYZ has plant and machinery with accounting depreciation amounting to $26,300 and tax depreciation amounting to $35,200.
Calculate the taxable profit for the year ended 31 March 20X4.

• A. $239,400
• B. $258,400
• C. $221,600
• D. $240,600