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on 1 July20X0, Abel \bullet

question 6

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The following information relates to Questions
On 1 July20X0, Abel Ltd entered into a 50:50 joint operation with Tasman Ltd to develop an oil field off the south coast of Tasmania. Each operator's initial contribution was €2 million. Abel contributed €1 million cash and equipment with a fair value of €1 million and a book value of €500,000. Tasman's contributed €2 million cash.
Additional information:
\bullet Production costs for the JO for the year ended 30 June 20X1 were:
000 Purchases 750 Wages 1,300 Management fee 400 Total production costs 2,450 Less: Work in progress (650)  Cost of production 1,800\begin{array}{lr}&€'000\\\text { Purchases } & 750 \\\text { Wages } & 1,300 \\\text { Management fee } & 400\\\text { Total production costs } & 2,450 \\\text { Less: Work in progress } & (650) \\\text { Cost of production }&1,800\end{array}
\bullet The remaining useful life of the equipment contributed by Abel is 5 years.
\bullet Tasman is responsible for the day to day management of JO and has recognised the management fee received during the year as revenue. The costs of providing these management services to JO was €225,000.
\bullet Tasman has sold all of the oil distributed to it and Abel has sold 50% of the oil distributed to it by 30 June 20X1.
An extract of JO's balance sheet at 30 June 20X1 shows:
000 Cash 650 Work in progress 650 Finished goods inventory 100 Plant & equipment 1,000 Accounts payable (100)  Net assets 2,300\begin{array} { l r } &€'000\\\text { Cash } & 650 \\\text { Work in progress } & 650 \\\text { Finished goods inventory } & 100 \\\text { Plant \& equipment } & 1,000 \\\text { Accounts payable } & (100) \\\text { Net assets }&2,300\end{array}
-Which of the following will not form part of Abel Ltd's initial contribution entry?

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Apply knowledge of behavior modification theories to real-world organizational problems and propose effective interventions.
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