Zoo Ltd, a Disclosing Entity, Has a Financial Year End

question 28

Multiple Choice

Zoo Ltd, a disclosing entity, has a financial year end of 31 March.On 10 April 20X4, the auditors discovered some equipment in a remote warehouse that had not been recognised in Zoo Ltd's financial statements.This equipment had been Zoo Ltd's property for about five years.
These assets should:

• A)be recognised in the financial statements for the financial year ended 31 March 20X4
• B)not be recognised in the financial statements
• C)be recognised in the financial statements for the financial year ended 31 March 20X5
• D)be recognised in the half year financial statements for the half year ended 30 September 20X4

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Definitions:

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, providing a snapshot of its financial condition.

Stock Dividend

A payment made to shareholders in the form of additional shares in the company, rather than cash.

Cash Dividend

A direct payment of profits made by a company to its shareholders, usually in cash.

Retained Earnings

The portion of a company's profit that is held or retained and saved for future use, investment, or to pay debt, rather than being distributed to shareholders as dividends.