FAC 3762/2021
Assignment 2
Unique number: 800077
ANNEXURE A: ASSIGNMENT 02 FOR FAC3762 - COMPULSORY FOR 2021
ASSIGNMENT 01 TOGETHER WITH TEST 1 AND ASSIGNMENT 02
COUNTS 30% TOWARDS YOUR FINAL MARK.
THIS ASSIGNMENT 02 CONTRIBUTES 20% TOWARDS YOUR
YEAR MARK FOR THIS MODULE.
UNIQUE NUMBER: 800077
DUE DATE: 30 August 2021
PLEASE NOTE:
1. This assignment consists of two (2) question with subsections.
2. All subsections of this question must be answered.
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3. All calculations must be shown.
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4. Please follow the instructions in the required part of the question carefully to ensure that you
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obtain the maximum marks for the question.
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5. This assignment covers learning units 1 to 11 of tutorial letters 102 - 106. Work carefully
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through the relevant tutorial matter before you attempt the assignment.
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6. Each student must prepare and submit their OWN individually prepared assignment.
Refer to PLAGIARISM DECLARATION on page 14 of Tutorial letter 101.
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7. No extension will be granted for the late submission of this assignment and no
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correspondence or telephone conversations will be conducted in this regard.
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8. Please follow the instructions for the submission of the written assignment carefully.
INSTRUCTIONS FOR SUBMISSION OF WRITTEN ASSIGNMENTS
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The assignment must be submitted online using myUnisa. Only online assignments will be
accepted.
Written assignments submitted electronically via myUnisa must be in a PDF format. Any
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format other than PDF will not be accepted by myUnisa.
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The assignment must be submitted as only one PDF file. The PDF file must not be a read-
only file.
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The page orientation must be in portrait layout.
This study source was downloaded by 100000830883196 from CourseHero.com on 08-30-2021 10:09:18 GMT -05:00
https://www.coursehero.com/file/102189373/Assignment-2pdf/
, FAC 3762/2021
Assignment 2
Unique number: 800077
ASSIGNMENT 02 (COMPULSORY FOR 2021)
WRITTEN ASSIGNMENT
Study:
➢ Learning units 1 to 11 of tutorial letters 102 to 106.
QUESTION 1
Plastico Ltd is a manufacturer of plastic products. It was established in 1990 and has operated
in the Gauteng area with a footprint across South Africa. The entity has a 31 December year
end. The following transactions occurred during the 2020 financial year.
Construction of plant
Due to the outbreak of the COVID-19 virus, the directors of the company decided to erect a
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new plant for the production of plastic containers to be used for the bottling of hand sanitisers.
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co
The new plant cost the company R4 500 000 (excluding interest) to erect and was financed by
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the issue of 4 000 convertible debentures at their fair value of R1 000 each, while the remaining
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R500 000 was paid for in cash. The debentures have a face value of R1 000 each and bear
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interest at a fixed coupon rate of 9.5% per annum compounded bi-annually in arrears. The
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coupon interest is payable bi-annually in arrears on 31 August and 28 February of each year.
The plant is a qualifying asset in terms of IAS 23, Borrowing costs.
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The debentures were issued on 1 March 2020 and are convertible at the option of Plastico Ltd
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on 28 February 2024 at a ratio of one share for every fifty debentures held. Any debentures not
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converted on 28 February 2024 will be redeemed at their fair value on the same date. A market
related interest rate for similar debentures without a conversion option is 11% per annum,
compounded bi-annually.
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Construction of the plant started on 1 February 2020. The expenses were incurred as follows:
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1 February 2020 R500 000
1 March 2020 R2 000 000
1 May 2020 R2 000 000
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Total R4 500 000
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Interest earned on excess funds amounted to R18 546 for the period. The plant was ready for
use on 30 November 2020 but was only brought into use on 4 January 2021 when the entity
commenced its operations at the start of the year.
sh
This study source was downloaded by 100000830883196 from CourseHero.com on 08-30-2021 10:09:18 GMT -05:00
https://www.coursehero.com/file/102189373/Assignment-2pdf/
Assignment 2
Unique number: 800077
ANNEXURE A: ASSIGNMENT 02 FOR FAC3762 - COMPULSORY FOR 2021
ASSIGNMENT 01 TOGETHER WITH TEST 1 AND ASSIGNMENT 02
COUNTS 30% TOWARDS YOUR FINAL MARK.
THIS ASSIGNMENT 02 CONTRIBUTES 20% TOWARDS YOUR
YEAR MARK FOR THIS MODULE.
UNIQUE NUMBER: 800077
DUE DATE: 30 August 2021
PLEASE NOTE:
1. This assignment consists of two (2) question with subsections.
2. All subsections of this question must be answered.
m
3. All calculations must be shown.
er as
co
4. Please follow the instructions in the required part of the question carefully to ensure that you
eH w
obtain the maximum marks for the question.
o.
5. This assignment covers learning units 1 to 11 of tutorial letters 102 - 106. Work carefully
rs e
through the relevant tutorial matter before you attempt the assignment.
ou urc
6. Each student must prepare and submit their OWN individually prepared assignment.
Refer to PLAGIARISM DECLARATION on page 14 of Tutorial letter 101.
o
7. No extension will be granted for the late submission of this assignment and no
aC s
correspondence or telephone conversations will be conducted in this regard.
vi y re
8. Please follow the instructions for the submission of the written assignment carefully.
INSTRUCTIONS FOR SUBMISSION OF WRITTEN ASSIGNMENTS
ed d
ar stu
The assignment must be submitted online using myUnisa. Only online assignments will be
accepted.
Written assignments submitted electronically via myUnisa must be in a PDF format. Any
is
format other than PDF will not be accepted by myUnisa.
Th
The assignment must be submitted as only one PDF file. The PDF file must not be a read-
only file.
sh
The page orientation must be in portrait layout.
This study source was downloaded by 100000830883196 from CourseHero.com on 08-30-2021 10:09:18 GMT -05:00
https://www.coursehero.com/file/102189373/Assignment-2pdf/
, FAC 3762/2021
Assignment 2
Unique number: 800077
ASSIGNMENT 02 (COMPULSORY FOR 2021)
WRITTEN ASSIGNMENT
Study:
➢ Learning units 1 to 11 of tutorial letters 102 to 106.
QUESTION 1
Plastico Ltd is a manufacturer of plastic products. It was established in 1990 and has operated
in the Gauteng area with a footprint across South Africa. The entity has a 31 December year
end. The following transactions occurred during the 2020 financial year.
Construction of plant
Due to the outbreak of the COVID-19 virus, the directors of the company decided to erect a
m
new plant for the production of plastic containers to be used for the bottling of hand sanitisers.
er as
co
The new plant cost the company R4 500 000 (excluding interest) to erect and was financed by
eH w
the issue of 4 000 convertible debentures at their fair value of R1 000 each, while the remaining
o.
R500 000 was paid for in cash. The debentures have a face value of R1 000 each and bear
rs e
interest at a fixed coupon rate of 9.5% per annum compounded bi-annually in arrears. The
ou urc
coupon interest is payable bi-annually in arrears on 31 August and 28 February of each year.
The plant is a qualifying asset in terms of IAS 23, Borrowing costs.
o
The debentures were issued on 1 March 2020 and are convertible at the option of Plastico Ltd
aC s
on 28 February 2024 at a ratio of one share for every fifty debentures held. Any debentures not
vi y re
converted on 28 February 2024 will be redeemed at their fair value on the same date. A market
related interest rate for similar debentures without a conversion option is 11% per annum,
compounded bi-annually.
ed d
Construction of the plant started on 1 February 2020. The expenses were incurred as follows:
ar stu
1 February 2020 R500 000
1 March 2020 R2 000 000
1 May 2020 R2 000 000
is
Total R4 500 000
Th
Interest earned on excess funds amounted to R18 546 for the period. The plant was ready for
use on 30 November 2020 but was only brought into use on 4 January 2021 when the entity
commenced its operations at the start of the year.
sh
This study source was downloaded by 100000830883196 from CourseHero.com on 08-30-2021 10:09:18 GMT -05:00
https://www.coursehero.com/file/102189373/Assignment-2pdf/
