注会-会计英语讲义(10)

会计英语基础讲义

Project 1 was originally expected to be highly profitable but this is now in doubt, since the scientist in charge of the project is now behind schedule, with the result that competitors are gaining ground.

Project 2： commercial production started during the year. Sales were 20,000 units in 20X8 and future sales are expected to be： 20X9 30,000 units; 20Y0 60,000 units; 20Y1 40,000 units; 20Y2 30,000 units. There are no sales expected after 20Y2.

Project 3： these costs relate to a new project, which meets the criteria for deferral of expenditure and which is expected to last for three years.

Project 4 is another new project, involving the development of a ‘loss leader’, expected to raise the level of future sales.

The company’s policy is to defer development costs, where permitted. Expenditure carried forward is written off evenly over the expected sales life of projects, starting in the first year of sale.

Required

Show how the above projects should be treated in the accounting statements of Forkbender Co for the year ended 31 December 20X8.

Answer

Project 1 expenditure, including that relating to previous years, should all be written off in 20X8, as there is now considerable doubt as to the profitability of the project. Since commercial production has started under project 2 the expenditure previously deferred should now be amortized.

Project 3： the development costs may be deferred.

Since project 4 is not expected to be profitable its development costs should not be deferred.

会计英语基础讲义

Notes：

第九章 资产减值 Impairment of Assets

The purpose of an impairment review（减值测试）is to ensure that tangible and intangible non-current/fixed assets （有形和无形非流动资产）are not carried in the accounts at a figure in excess of their recoverable amount（可收回金额）. Goodwill（商誉） and indefinite-lived intangible assets have to be annually reviewed for

impairment. Other non-current/fixed assets have to be reviewed for impairment only when there is an indicator that carrying amounts may not be recoverable, ie carrying value > recoverable amount, where recoverable amount is the higher of value in use (VIU) （使用价值）and net selling price (NSP)（销售净值）.

Circumstances that trigger the need for a review may arise from external or internal sources. 对资产减值迹象的判断可根据企业内部信息和外部信息。

Internal sources include：

●physical damage to, or obsolescence of, a non-current/fixed asset

●a significant reorganisation of business operations

●the loss of key employees